<div id="readability-page-1" class="page">Several Chinese cloud service providers are “evaluating price increases”, according to analysts, following recent moves by Google and Amazon Web Services (AWS), as the explosive growth of artificial intelligence drives demand. Google on Tuesday announced price rises of up to 100 per cent for certain services, effective May 1. For example, North American users of the CDN Interconnect, Direct Peering, and Carrier Peering services will pay US$0.08 per gigabyte, double the current rate. In Asia, the charge will be US$0.085 per gigabyte, up 42 per cent. Similarly, AWS earlier this month raised the price of its “EC2 Capacity Blocks for ML” service by about 15 per cent across all regions. The service reserves accelerated compute instances to run machine learning workloads. “The price increase stems from dual pressures of rising costs and surging demand,” said Liu Lihui, research director at market research firm IDC China. “On one hand, higher prices for upstream servers, storage, and memory, coupled with escalating electricity and energy costs, have driven up computing service expenses. On the other, corporate demand for AI computing power continues to grow rapidly.” The increases “have broken the long-standing convention that prices [of cloud services] only go down and never up”, according to a research note by Everbright Securities.  IDC’s Liu added that “several Chinese cloud service providers are also evaluating and following up on this round of price increases, with a greater emphasis on assessing the impact of upstream hardware supply chains in their considerations”. Everbright Securities analysts, however, projected China’s cloud services industry “to follow suit in slowing price cuts” for now. Alibaba Cloud led China’s AI cloud services sector in the first half of 2025 with a 36 per cent market share. ByteDance’s Volcano Engine, Huawei Cloud and Tencent Cloud followed with 15, 13 and 7 per cent, respectively, according to market intelligence Omdia. None of the four companies immediately responded to requests for comment. Alibaba Cloud is the AI and cloud computing unit of Alibaba Group Holding, which owns the Post. Global tech giants are investing heavily in AI infrastructure. On Tuesday, Facebook owner Meta Platforms struck a deal worth up to US$6 billion with Corning to expand data centres in the US to support the company’s “apps, technologies, and AI ambitions”. A day earlier, Nvidia invested an extra US$2 billion in AI cloud builder CoreWeave as the two expanded the partnership to build more than 5 gigawatts of AI factories by 2030. AI demand can be measured by tokens, the smallest units of data that are processed by models. Li Feifei, senior vice-president of Alibaba Cloud Intelligence, said last week that token consumption worldwide could grow by at least 100-fold, or even 1,000-fold, this year, while memory prices, which rose at least 30 per cent over the past few months, would climb by at least 200 per cent. The cloud industry has long been locked in a price war to lure customers. Alibaba Cloud cut prices six times in 2014 and 17 times in the year ending October 2016. In 2024, the cloud units of Alibaba, Tencent Holdings, JD.com and China Mobile all reduced prices. Additional reporting by Wency Chen and Iris Deng</div>

<p>Several Chinese cloud service providers are considering price increases following significant hikes by Google and AWS, driven by rising costs and surging demand for AI computing power. Google announced price increases of up to 100% for certain services, while AWS raised its EC2 Capacity Blocks for ML service by about 15%. Analysts suggest that this marks a shift from the long-standing trend of decreasing cloud service prices. Major players like Alibaba Cloud, ByteDance, Huawei Cloud, and Tencent Cloud are evaluating their pricing strategies in response to these market changes.</p>

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Price rises on horizon for Chinese cloud firms after Google, AWS set new rates