Alibaba in Talks With BT for Cloud Partnership in Europe Push

Alibaba is in talks with BT Group about a cloud services partnership as the Chinese internet giant challenges Amazon’s dominance in Europe, according to Bloomberg.

An agreement between Alibaba and the IT consulting unit of Britain’s former phone monopoly could be similar to Alibaba’s existing arrangement with Vodafone in Germany, according to a person familiar with the matter. A BT spokeswoman confirmed by email that the U.K. telecom company is in talks with Alibaba Cloud and declined to give details.

Started in 2009, Alibaba Cloud has expanded fast beyond China in a direct challenge to Amazon Web Services, the e-commerce giant’s division that dominates cloud computing. Alibaba Cloud is now the fourth-biggest global provider of cloud infrastructure and related services, behind Amazon, Microsoft and Google, according to a report last month by Synergy Research Group.

Europe has become key to Alibaba Cloud’s success outside China, with prospects in the U.S. made murky by President Donald Trump’s America First agenda. Alibaba has pulled back in the U.S. just as tensions between America and China have escalated under Trump.

BT Global Services has struck up partnerships with Amazon, Microsoft and Cisco, while Spain’s Telefonica works with Amazon. In Germany, while Deutsche Telekom’s T-Systems has partners including Huawei and Cisco, it has structured its public cloud offering as an alternative to U.S. giants Amazon and Google, touting its ability to keep data within Germany where there are strict data-protection laws, 100 percent out of reach of U.S. authorities.A deal with Alibaba could bolster BT’s cloud computing and big data skills as clients shift more of their IT capacity offsite to cut costs.