Alibaba to spend $28.2 billion in cloud infrastructure as it combats Amazon, Microsoft

Alibaba said on Monday it would invest 200 billion yuan ($28.26 billion) in its own cloud computing department over the next three decades, highlighting how critical an area this is into the e-commerce giant's potential growth.

The money will be used to purchase infrastructure and technologies related to managing systems, computers, servers, and chips, Alibaba said, adding that the coronavirus pandemic spurred it.

"The Covid-19 pandemic has introduced additional strain on the total market across industries, but also, it disturbs us to place additional attention to the electronic market," Jeff Zhang, president of Alibaba Cloud Intelligence, said in a statement.

Alibaba is the largest cloud computing supplier by market share in China -- but it paths U.S. giants Amazon and Microsoft globally despite its global push, according to Synergy Research.

However, Alibaba has set a concerted attempt on cloud computing, and analysts in addition to executives see it getting an important area in the upcoming, despite it currently accounting for just 7% of the organization's total revenue.

The most recent investment can help the firm expand its product and customer base, especially in international markets, even as it seems to combat Amazon and Microsoft. In China, meanwhile, Alibaba is confronting climbing competition in the cloud area by e-commerce rival JD.com.