Alibaba abandons quantum computing

Quantum computing was supposed to be the future, but it seems not.

Alibaba abandons quantum computing
Chema Carvajal Sarabia

Chema Carvajal Sarabia

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A few years ago, it seemed like everything was going to be about quantum computing. No talk about artificial intelligence; it was quantum computers that would change the world. Now we know not all companies are on the same page. For instance, Alibaba, the Chinese giant, seems to have shifted its focus.


In the same month that Alibaba shelved its plans to spin off its cloud computing division (but not its AI division), the e-commerce and cloud computing company closed its quantum computing research lab.

Alibaba shut down its quantum computing research lab as part of its restructuring efforts.

What Alibaba loses with the farewell of quantum computing

The closure of the lab will result in the loss of about 30 jobs, but the equipment will be donated to Zhejiang University in Hangzhou, where the company is headquartered, as reported by a company spokesperson to Bloomberg.

According to reports from Chinese media cited by Bloomberg, Alibaba has had an active presence in the quantum computing market since 2015, with its now-closed Quantum Lab Academy offering an 11-qubit quantum cloud platform to educate both employees and students about the technology.

The company is believed to have invested around $15 billion in emerging technologies like quantum computing.

In simple terms, quantum computers are machines that harness the attributes of quantum physics to store data and perform calculations.

This technology can significantly surpass traditional supercomputers, making it particularly advantageous for specific tasks and use cases such as cybersecurity, pharmaceutical development, financial modeling, climate change analysis, artificial intelligence, solar energy capture, and electronic materials discovery.

Alibaba is reviewing its future plans: not looking good

The news comes less than two weeks after Alibaba scrapped plans to spin off and take its cloud computing unit public, citing “uncertainties” related to recent U.S. controls on chip exports to China.

Had it proceeded, the restructuring plan would have divided the company into six groups, with its cloud computing division going public in May 2024.

Joseph Tsai and Eddie Wu, Chairman and CEO of Alibaba respectively, lead the restructuring in a shake-up of top management that occurred in June. Both are company veterans and apparently close confidants of its founder, Jack Ma.

Following the decision not to move forward with that plan, the company suffered a $20 billion drop in its market value, and stocks fell by 10% in Hong Kong.

Alibaba has reportedly laid off over 30,000 employees across the organization since 2022 due to escalating costs, as reported by Chinese media.

Alibaba Cloud is one of the largest providers of public cloud services in the region, competing with American giants like Amazon Web Services, Google Cloud, and Microsoft Azure. The U.S. restrictions on chips are expected to help American cloud providers outpace their Chinese rivals.

Apart from the Cloud Intelligence Group or the cloud computing unit, the other divisions include Taobao Tmall Commerce Group, Global Digital Commerce Group, Local Services Group, Cainiao Intelligent Logistics Group, and Digital Media and Entertainment Group.

For Alibaba, quantum computing seems like someone else’s game, bidding farewell to striving for supremacy independently. When IBM arrives, as it will, Alibaba may have to buy their technology.

Chema Carvajal Sarabia

Chema Carvajal Sarabia

Journalist specialized in technology, entertainment and video games. Writing about what I'm passionate about (gadgets, games and movies) allows me to stay sane and wake up with a smile on my face when the alarm clock goes off. PS: this is not true 100% of the time.

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