Alibaba’s cloud computing unit suffered a system shutdown on December 19 that caused services to be interrupted for more than 12 hours. The anomaly, which was triggered by the failure of refrigeration equipment at a data center site operated by PCCW, led to the suspension of cryptocurrency withdrawals on OKX, also disabling websites for Macau’s monetary authority and other businesses.
At 10:47 a.m. on December 19, Alibaba Cloud announced that an equipment aberration at a data center in Hong Kong affected the regular use of ECS (elastic compute service), databases, and other cloud products in “Available Zone C,” and that engineers were already working urgently to deal with the situation. As of now, the websites and apps affected by the incident can be accessed normally.
The fault also hampered the websites and apps operated by the Monetary Authority of Macau, Galaxy Macau hotel, Lotus TV Macau, Macau Cement Manufacturing Co. Ltd., food delivery platform MFood and Aomi, and media outlet Macau Daily. Even Linux China’s official website was inaccessible, and many personal webmasters were also impacted.
This failure has had a serious impact on the cryptocurrency circle. Well-known crypto exchange Gate.io’s charging services were delayed. OKX interrupted its trading service for several hours and directly shut down all users’ transactions and restricted currency withdrawal. This caused some OKX users’ encrypted assets to be displayed as 0, causing considerable concern.
After resuming services, OKX said that it will ensure that core services are deployed in multiple cloud service providers, and when one of them fails, it can quickly switch to another.
According to the incomplete statistics of 01ThinkTank, since 2010, QingCloud, a hybrid cloud listed company, has experienced four outages, while Alibaba Cloud and Tencent Cloud have experienced five and eight outages respectively, most of which occurred in 2018 and 2019. Globally, since 2010, AWS, Google Cloud Platform, and Microsoft Azure have experienced about 22, 12, and eight outages.
Repair times have ranged from 40 seconds to 24 hours. As a cloud services provider with strong technical strength, it is quite rare for Alibaba Cloud to have such a long service failure. Star Xu, CEO of blockchain technology OK Group, even called this failure “a major scandal in the history of Alibaba Cloud’s development.”
Nevertheless, Alibaba Cloud, Tencent Cloud, Huawei Cloud and Baidu AI Cloud occupy most of the cloud services market in China. According to a report on 2021 global cloud computing IaaS market share released by Gartner in April, Alibaba Cloud ranks third globally with a market share of 9.55%, and it ranks first in the Asia-Pacific market with a share of 25.53%.
Alibaba Cloud achieved annual profits for the first time this year. According to Alibaba‘s 2022 financial report released in May, its cloud business achieved a profit of 1.146 billion yuan ($164 million). However, Alibaba Cloud is still facing a slowing growth rate of its cloud computing market share. According to data released by Canalys, in the third quarter of this year, the Chinese cloud infrastructure service expenditure increased by 8% year-on-year to reach $7.8 billion, accounting for 12% of global cloud expenditure. Furthermore, the annual increase has slowed down since the first quarter of this year.