China-based Alibaba has been undergoing a lot of changes lately. One of the most talked about is the changing of the guard occurring as its lovable founder Jack Ma steps down as chairman to pursue philanthropic endeavors and take time for himself. As he puts it, “I don’t want to die in the office, I’d rather die on the beach.” While this has taken the headlines, an even more important change has been happening, namely a shift in strategy that is much broader than being the center for the online wholesale universe.
The interesting thing about IoT technologies is that it can be applied in a wide variety of settings. For this reason, Alibaba probably thinks selling their IoT technology is a better strategy than trying to keep it internal as a competitive advantage in their battle for “new retail.” The markets for IoT include manufacturing, smart buildings/cities and transportation. Alibaba and Intel have even gone on the record as saying that they are working on an intelligent transportation solution that uses v2x (vehicle-to-everything) communication.
This initiative shows that Alibaba is using a similar strategy to their rival Amazon but sticking to their business-to-business focus. Rather than trying to come out with a consumer product like Amazon did with their Alexa devices, Alibaba wants to create an enterprise service around the growing IoT sector. As they have already proved, while there is a lot of good headlines in consumer goods there is lasting value in enterprise services.