Alibaba Cloud and Siemens AG are partnering to improve China’s manufacturing efficiency by developing the industrial Internet of Things in China, the companies said in a joint statement Tuesday.
Under the agreement, the German industrial giant and Alibaba Cloud will immediately start working together to make MindSphere, Siemen’s cloud-based open IoT system, available on Alibaba Cloud from 2019.
“The implementation of MindSphere on Alibaba Cloud will provide compelling services for companies in China Mainland to innovate with advanced industrial solutions,” the statement said.
Established in 2009, Alibaba Cloud, the cloud computing arm of Alibaba Group, is among the world’s top-three Infrastructure as a Service (IaaS) providers according to Gartner, and the largest provider of public cloud services in China, according to IDC.
The deal was formalized Tuesday at an event attended by German Chancellor Angela Merkel and Chinese Premier Li Keqiang, who’s on a three-day official visit to Europe.
China was Germany’s biggest trading partner in 2017 for the second year in a row, with total trade rising to EUR186.6 billion ($230 billion), up 9.6% from the previous year, according to Germany’s Federal Statistics Office.
The deal underscores China’s ambition to be a global industrial and manufacturing powerhouse. In May 2015, Beijing unveiled the “Made in China 2025” plan, a long-term, strategic initiative to move China’s industrial sector up the value chain through digitization. The plan was partially inspired by German’s Industrie 4.0, a government-backed plan to promote computerization of manufacturing.
Moreover, for Siemens, the deal raises its visibility and widens its influence in China, which is already its third-largest market. Until now, its digital products are only offered through Amazon Web Services and Microsoft’s Azure online platform. As a relatively newcomer to the cloud industry, Alibaba Cloud is seeking access to larger enterprises, a more-diverse customer base and a chance to up its know-how in serving the industrial sector.
“Today’s landmark partnership marks an exciting step towards Alibaba Cloud’s goal to enable digital transformation across the globe.…We hope to accelerate the adoption of IoT products and services that will create industry-wide breakthroughs and progress,” said Simon Hu, president of Alibaba Cloud.
Siemens CEO Joe Kaeser said the cooperation intends to bring Industrie 4.0 solutions to China and allow end-users in China to “unlock the potential of the Industrial IoT with MindSphere.”