Alibaba Cloud expands Korea capacity for enterprise AI

Alibaba Cloud has expanded its data centre capacity in South Korea to bolster enterprise AI adoption. The company inaugurated a third data centre on August 18, nearly 14 months after its second facility began operations. This expansion reflects growing demand for generative AI and enterprise AI agents in the region. The newest site in South Korea will provide additional computing, storage, networking, database, security, container, and cloud-native services.

It is also designed to support lower latency workloads and provide disaster recovery options. Alibaba Cloud has not disclosed specific details about the new centre's power capacity, investment cost, or utilization rate. However, the company has mentioned that more computing equipment can be added as customer demand grows. Operating three data centres enhances the resilience of Alibaba Cloud's South Korean infrastructure.

If one facility experiences an outage, applications can remain distributed across the remaining two facilities. This configuration has enabled Alibaba Cloud to raise its service-level availability commitment for its Korea region from 99.95% to 99.99%. Alibaba Cloud is introducing six agentic AI services in South Korea to help companies transition AI agents from experimental projects to production environments.

These services cover development, testing, deployment, operations, and cybersecurity. Enterprise AI is becoming a crucial part of Alibaba Cloud's strategy in the region. The company is pairing these services with its full-stack AI offering, which includes infrastructure, development platforms, and the Qwen family of AI models. South Korean companies are already utilizing parts of Alibaba Cloud's AI ecosystem.

For instance, Gwangju-based Gendive has integrated Alibaba models into its DevDive enterprise automation platform, while NAVER Z's ZEPETO platform leverages Alibaba Cloud infrastructure for real-time 3D avatar generation and immersive services. Alibaba Cloud has established local partnerships with companies such as Megazone Soft and Team Sparta to provide consulting, implementation, and industry-specific services.

Data sovereignty is a significant factor influencing cloud investment in South Korea, as businesses handling sensitive information prefer workloads hosted within national borders. Alibaba Cloud assures that its South Korean infrastructure complies with local data-protection and cybersecurity requirements. As part of its broader AI and cloud infrastructure commitment, Alibaba Cloud plans to spend about 380 billion yuan ($53 billion) over three years.

The company has already invested heavily in computing capacity, chips, and AI development to establish cloud services as a growth engine. Alibaba Cloud's revenue from cloud and AI-related sales reached about 48.4 billion yuan in the April-June quarter of 2026, marking a 45% increase compared to the previous year. This expansion has required substantial capital expenditure, with Alibaba Cloud's quarterly capital expenditure reaching nearly 67.7 billion yuan.

The company has also expanded its cloud infrastructure in France, Japan, Malaysia, and Mexico. With the new South Korean facility, Alibaba Cloud's global network now includes 104 availability zones across 30 regions.