On 9 September 2014, a major Chinese tech company made new history on the New York Stock Exchange, shaking Wall Street when Alibaba's IPO raised over 25 billion US dollars on its first trading day, becoming the highest-valued tech IPO since Twitter the previous year.
At that time, Alibaba was well-known as an e-commerce company founded by billionaire Jack Ma in 1999, with the vision of connecting Chinese sellers with buyers worldwide. Alibaba's success made it the highest-valued tech IPO for several years, expanding its platforms from Alibaba to Taobao and Tmall.
As China's economy slowed and e-commerce competition intensified, Alibaba expanded its empire across sectors including finance, logistics, entertainment, cloud computing, and most importantly, AI. The company now covers 25 businesses and sees itself as operating a hybrid model combining Amazon, PayPal, Google, Uber, and even Netflix.
Today, competition in e-commerce remains fierce both in China and globally. Despite government antitrust scrutiny and losing market share to competitors, Alibaba's longest-standing and most powerful business sectors are AI and cloud computing.
Back in 2016, Alibaba officially began its AI journey by launching its first AI lab, pursuing continuous AI research and development to build advanced technology. By 2017-2018, it expanded into education by founding DAMO Academy, focusing on science and technology innovation. During the COVID-19 pandemic, Alibaba accelerated its AI research, eventually developing foundational AI models and designing its own chips, signaling a commitment to full-cycle AI development before 2020.
At the end of 2022, ChatGPT created a pivotal moment that popularized AI globally and pushed companies to rapidly develop unprecedented artificial intelligence. Alibaba, having already built its AI foundation, responded by launching a world-class AI research lab, investing heavily in startups, and aiming to become China's "OpenAI." to achieve that goal. . (Note: This part is a continuation of the previous sentence, kept separate per instructions.)
Less than a year after ChatGPT's breakthrough, Alibaba appointed Joe Tsai as the new company chairman and Eddie Wu as CEO. The company underwent major restructuring to grant autonomy to individual divisions and reduce the number of business units for easier management. E-commerce remained the core revenue driver, while massive investments focused on the future areas of AI and cloud computing. . (Continuation of previous sentence, per instruction to translate parts in isolation.)
Eddie Wu pushed Alibaba to adopt a startup mindset with two main strategies: "User first" and "AI-driven." Within just 15 months after taking office, quarterly capital expenditures doubled compared to the previous year, as the company aggressively invested in AI infrastructure and cloud services development.
Driven by transformation and full momentum, Alibaba expanded its AI product offerings, with the key highlight being "Qwen," a Large Language Model (LLM) whose full name, "Tongyi Qianwen (通义千问)," roughly translates to "Ask a thousand questions, answered by one intelligence."
Qwen's capabilities resemble ChatGPT, including understanding text, answering questions, translating languages, and analyzing images. Its distinct feature is being an open-source model, allowing developers to modify, distribute, and use its code freely.
In China, open models are the primary AI development approach, while the US focuses on closed models that cannot be downloaded or reused, which American tech companies use mainly for profit. China believes open models promote wider adoption and ecosystem growth.
In early 2025, a major event shook the AI world: the arrival of DeepSeek, another open model in the AI market. This pressured both Western and Chinese players to intensify competition in this field.
According to CNBC, DeepSeek launched near China's long holiday, but its R1 model's impact caused Qwen's developers to turn their holiday into a creative sprint to surpass it. Shortly after DeepSeek's release, Alibaba unveiled Qwen 2.5, matching R1's capabilities, and in April 2025 launched Qwen 3, its most advanced model to date.
Qwen also powers "Quark," an AI assistant app with over 150 million monthly users. Quark serves both general and business users, offering features like document translation, meeting summary, location search, and integration with Alibaba's shopping apps, earning it the nickname "China's intelligent genie."
Another key element in Alibaba's AI empire is "ModelScope," which acts like an app store for AI developers and researchers. ModelScope offers a variety of pre-trained models for developers to select, modify, or build upon without starting from scratch. It currently has over 16 million users and thousands of models created on its platform, marking a major success in building Alibaba's AI ecosystem.
Additionally, behind the growth and distribution of AI models is "Aliyun," Alibaba's cloud platform that serves as a critical hub enabling businesses to run Qwen or other models on Alibaba Cloud to build or develop additional applications. Aliyun is recognized as a significant competitor to Amazon Web Services and Microsoft Azure.
While currently a smaller player globally with about 4% market share, trailing AWS, Microsoft Azure, and Google Cloud, Aliyun is China's largest cloud provider, holding roughly one-third of the domestic market as of 2024.
China, never yielding in competition with other countries, has declared its clear ambition to become "the world leader in AI." Alibaba is a key national asset in this strategy, and since 2018, the company has adapted its vision to align with national goals.
According to Morgan Stanley, China's AI investments are projected to yield a 52% return by 2030. Alibaba appears to be realizing this early; as of August 2025, its cloud business revenues grew 26% year-over-year, while AI projects have posted triple-digit growth for eight consecutive quarters.
This return stems from prior efforts and investments that gave Alibaba a stronger foundation than newer entrants, an open model attracting numerous users to enrich its ecosystem, and collaboration with government and educational institutions to build AI research centers and talent.
Although China is still seen as lagging behind the US in AI and cloud sectors and faces tough international competition, Alibaba's heavy investment aims to position it as the national AI development hub and close the gap to lead global AI by 2030.
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