Alibaba CEO elevates AI to key priority in group revamp plan
ALIBABA Group Holding will put artificial intelligence (AI) and user experience at the top of its priorities, as its new leadership seeks to reclaim customers and market share in a fiercely competitive arena.
Chief executive officer Eddie Wu laid out his vision in a memo to staff on Tuesday (Sep 12) for the first time since officially taking over from veteran Daniel Zhang.
Wu stressed that Alibaba must adjust its approach to go AI-first, while not forgetting the hundreds of millions of users who helped create one of China’s largest corporations.
In recent years, however, that lead has come under attack from new rivals in social media such as ByteDance, while the likes of Baidu have invested heavily in AI.
“We will recalibrate our operations around these two core strategies and reshape our business priorities,” Wu said in his note, reviewed by Bloomberg News.
The Hangzhou-based e-commerce leader will reinforce strategic investments in the areas of AI-driven tech businesses, Internet platforms and its global commerce network, Wu said. Like all of China’s top tech companies, Alibaba has this year made catching up and leading in AI a top priority, and Wu’s comments underline that commitment.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Alibaba’s CEO transition comes as the company is navigating a shifting landscape of fiercer competition from up-and-coming rivals coupled with mounting domestic economic headwinds. While the company is gradually rebounding from a two-year-long tech crackdown imposed by Beijing, it continued to encounter more uncertainties as Zhang unexpectedly quit over the weekend, having only months earlier accepted the role of steering its key Cloud Intelligence Group. The departure has been seen as indicative of greater sway for the new leadership team, headed up by Wu and group chairman Joe Tsai.
Wu and Tsai, two of the company’s earliest employees, are long-time close confidants of co-founder Jack Ma and taking over at a critical juncture. After weathering some of the worst blows from China’s tech crackdown, the e-commerce leader has to secure its top spot against competitors like JD.com and upstarts like ByteDance while executing a complex plan to split into six major business units.
Among them, the cloud division is seen as one of the biggest potential growth drivers, should Alibaba be able to capture a large share of the market for providing AI infrastructure and services. Its efforts to raise fresh funds are taking a while – the company put a Hong Kong initial public offering of its Freshippo grocery chain temporarily on hold due to the expected valuation, Bloomberg News reported.
Alibaba joined a global race this year to stake out a spot in the emergent field of AI, considered critical to advancing not just tech companies but national strategic imperatives. It was not among those who secured the first batch of regulatory approvals for offering generative AI services in China, though it has made a splash with integrations of its ChatGPT-like model into its meeting and messaging apps.
“Who is going to run Alibaba Cloud is now the single most important growth question for Alibaba,” said Jeffrey Towson, a partner at TechMoat Consulting. The company has said it will continue the process to independently spin off the cloud unit, which is separately seeking to raise as much as 20 billion yuan (S$3.73 billion), with potential backers including Chinese state enterprises.
Share with us your feedback on BT's products and services
