Big tech builds two rival AI cloud ecosystems led by the US and China

In short: The world’s biggest cloud and AI companies are expanding fast, and the market is increasingly splitting into a US-led and a China-led set of tools and data centers.

What's going on

Cloud computing is the rented backbone that runs many online services (like renting electricity and machines instead of buying your own). In this market, Amazon Web Services has been the largest provider, with Gartner estimating a 37.7% share in 2024. Microsoft was next at 23.9%, followed by Google at 9%, Alibaba at 7.2%, and Huawei at 4.1%.

Newer figures from Synergy Research for July 2025 show the same order but different shares, with Amazon at 30%, Microsoft at 20%, Google at 13%, Alibaba at 4%, and Huawei at 2%. These companies are also building more global locations for their cloud services. For example, Microsoft Azure has more than 70 regions, Google Cloud has 42, AWS has 38, and Huawei Cloud says it operates 101 availability zones across 34 regions.

A big reason for the spending is demand for AI computing, meaning the powerful chips and servers needed to run AI models. Amazon and Google have reported strong cloud growth linked to AI workloads, with AWS up 20% year over year and Google Cloud up 34% in a recent quarter. In China, Alibaba has said it plans to invest $53 billion over three years in cloud and AI infrastructure, while Huawei promotes its Pangu models for industry uses like finance, manufacturing, and healthcare.

What to watch

The split could deepen as governments tighten rules around selling advanced chips and cloud services across borders. That may push many countries in the Middle East, Latin America, and parts of Asia and Africa to choose Chinese providers for cost or access, while the US companies stay strongest in North America and Europe.

Source: Financial Times