TL;DR
Alibaba Cloud launched its first data centres in France, opening two availability zones in Paris as its third European hub. The expansion comes as the EU’s new Cloud and AI Development Act introduces sovereignty rules that could limit non-EU providers’ access to public-sector contracts.
Alibaba Cloud on Wednesday launched its first data centres in France, opening two availability zones in Paris as part of a broader push into a European market that is rapidly reassessing its dependency on foreign cloud providers. The facilities make France Alibaba Cloud’s third European hub, after Germany, where it has operated since 2016, and Britain.
“The expansion of our cloud infrastructure into France reinforces our ongoing commitment to empowering European businesses with sovereign, secure, and intelligent solutions,” said Feifei Li, Alibaba Cloud’s chief technology officer and president of international business. The company said it plans to roll out agentic AI services across Europe in the second half of the year.
Sovereignty as sales pitch
The timing is deliberate. The European Commission published its tech sovereignty package on 3 June, a bundle of measures aimed at reducing the bloc’s dependence on American and Asian technology across semiconductors, cloud infrastructure, and artificial intelligence.
The package’s centrepiece, the Cloud and AI Development Act, identified “limited data centre capacity” as a significant threat to Europe’s ability to benefit from the digital transformation. It also introduced a four-tier cloud sovereignty framework that will require public authorities to assess how much of their infrastructure depends on non-EU firms.
That framework could work against Alibaba as easily as it works for it. France has been particularly aggressive on digital sovereignty, and the strictest tiers in the new EU classification demand EU ownership and operational independence, conditions a Chinese company would struggle to meet for government contracts.
Alibaba’s European play
Despite ranking fourth globally among cloud providers by revenue, Alibaba Cloud remains a small player in Europe. Amazon Web Services, Microsoft Azure, and Google Cloud together account for roughly 70 per cent of the region’s cloud infrastructure revenue, according to Synergy Research Group, while all European providers combined reportedly hold just 15 per cent.
Alibaba has been raising its profile through partnerships. In May, the company signed a six-year deal with UEFA covering the Champions League and Euro 2028 as the official AI, cloud computing, and e-commerce partner.
The broader expansion was announced by chief executive Eddie Wu at Alibaba’s Apsara Conference in Hangzhou last September, when he unveiled what the company called its biggest-ever overseas investment in AI infrastructure. The plan included new cloud regions in Brazil, France, and the Netherlands, alongside capacity expansions in Mexico, Japan, South Korea, Malaysia, and Dubai.
The revenue engine
Alibaba’s Cloud Intelligence Group reported a 38 per cent increase in revenue in the first quarter of 2026, reaching 41.6 billion yuan ($6.15 billion). AI-related products accounted for roughly 30 per cent of external cloud revenue, following 11 consecutive quarters of triple-digit growth in that category.
The company has committed at least 380 billion yuan ($53 billion) to AI and cloud infrastructure over three years, part of a broader wave of Chinese AI infrastructure investment that it says exceeds its total cloud spending over the past decade. Whether that investment translates into meaningful European market share will depend on how the EU’s sovereignty rules shake out, and whether enterprises in a bloc increasingly wary of technology dependencies choose to entrust their data to a provider headquartered in Hangzhou.