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Chinese Internet behemoth Alibaba has teamed up with Japanese telecom giant SoftBank to form a cloud-computing joint venture (JV) in Japan.

SoftBank’s parent company, SoftBank Group, is an existing shareholder in Alibaba, so the deal isn’t exactly a bolt out of the blue. SB Cloud Corporation, or “SB Cloud,” as it will be known, will combine the collective smarts from the two technology titans, and the joint venture will lead to a new data center that provides “competitive and enhanced public cloud computing services” from Alibaba Cloud, according to a press release.

Since going public on the New York Stock Exchange (NYSE) back in 2014, Alibaba, sometimes referred to as the “Amazon of China,” has sought to bolster its cloud credentials with data centers physically located in the U.S. — the first launched in March 2015, followed by a second in Silicon Valley six months later.

Alibaba has been pushing to enhance its reputation and mindshare in Western markets, and even went so far as to acquire one of Asia’s biggest English-language newspapers, the South China Morning Post. But with the SoftBank tie-up, it’s clear that Alibaba isn’t ignoring markets closer to home. This new venture will put Alibaba up against the likes of Amazon, which already has data centers in the country.


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“I believe the JV team can develop the most advanced cloud platform for Japanese customers, as well as for multinational customers who want to use the resources we have available in Japan,” said Eric Gan, executive vice president of SoftBank and now representative director and CEO of SB Cloud.

Partnering with a domestic juggernaut in the form of SoftBank is a smart move and gives Alibaba a much smoother path into the lucrative business-oriented cloud computing market.

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