Alibaba Group and SAP announce strategic partnership to accelerate AI-powered digital transformation
Madrid, Spain — Alibaba Group (NYSE: BABA and HKEX: 9988) and SAP SE (NYSE: SAP)announced a strategic partnership to jointly accelerate enterprise innovation and digital transformation through advanced cloud and AI technologies.
The partnership combines SAP's industry-leading enterprise software with Alibaba Cloud's secure, scalable cloud infrastructure and cutting-edge AI capabilities. Alibaba Cloud will be part of the latest SAP Infrastructure as a Service (IaaS) Certification Program, to fully support customers running SAP's enterprise cloud solutions. Alibaba Group will also leverage SAP Cloud ERP Private for its enterprise infrastructure as part of the collaboration.
The collaboration will initially focus on the China market and rollout is planned for Southeast Asia, the Middle East and Africa to enable enterprises to implement SAP Integrated Business Planning (IBP) and embark on their RISE with SAP and GROW with SAP journeys. With Alibaba Cloud as a certified hyperscaler for SAP workloads, enterprises will also be able to deploy SAP Cloud ERP and SAP Cloud ERP Private solutions on Alibaba Cloud's infrastructure.
The global IaaS market is projected to grow from $190.32 billion in 2025 to $712.46 billion by 2032, at a CAGR of 20.8% [Infrastructure as a Service [IaaS] Market Share & Growth, 2032] with the Middle East region, according to leading consulting firms, set to account for 2–4% of the global IaaS market, which would translate to approximately $3.8 to $7.6 billion in 2025.
The two companies also plan to establish a joint go-to-market approach to serve global businesses across industries with scalable and intelligent solutions tailored to local needs. Alibaba Group also plans to deploy SAP Business AI, SAP Business Technology Platform, SAP Ariba, SAP Integrated Business Planning, SAP SuccessFactors, SAP Concur, and SAP Emarsys solutions to further optimize its technological backbone, ensuring greater agility and resilience in serving its vast ecosystem of businesses and consumers.
The partnership also marks a significant step forward in enterprise AI integration. SAP is exploring the integration of Alibaba's large language model, Qwen, to the SAP generative AI hub in SAP AI Core in China, to enable enterprise users to access localized generative AI capabilities within SAP's applications and Custom AI applications. SAP is also exploring the deployment of its SAP AI Foundation on Alibaba Cloud to bring powerful, scalable AI tools to customers operating in China.
'Our collaboration with SAP reinforces our commitment to empowering global businesses with world-class technologies,' said Joe Tsai, Chairman of Alibaba Group. 'By combining SAP's enterprise software with Alibaba Cloud's robust infrastructure and AI capabilities, we are enabling customers to build smarter, more agile operations.'
'Our collaboration with Alibaba Group is a testament to the power and flexibility of SAP's cloud solutions,' said Christian Klein, CEO of SAP SE. 'Our joint go-to-market strategy can unlock new opportunities for enterprises by providing them with access to a comprehensive suite of tools and services. Together, we can help our joint customers drive innovation, improve operational performance, and create new competitive advantages, and we look forward to working with Alibaba to shape the future of cloud-powered digital transformation."
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