Baidu and Alibaba led China’s public cloud services market for AI in 2024, each holding about 25% share, according to consultancy IDC.

The market reached 19.6 billion yuan (US$2.7 billion) in 2024, up 55% year-on-year due to rising demand for AI training and apps.

Tencent and Huawei followed as the next largest players, though exact shares were not disclosed.

IDC noted that market growth was driven by increased adoption of generative and agentic AI technologies, with large language models becoming more prominent from 2023.

Within AI cloud services, the computer vision segment was the largest, climbing 34% to 8.1 billion yuan, with Tencent and Baidu leading this segment.

Demand for AI cloud services has shifted from traditional uses like quality inspection to newer applications such as autonomous, task-oriented AI.

🔗 Source: South China Morning Post

🧠 Food for thought

1️⃣ Generative AI is reshaping cloud service demand patterns globally

The shift from traditional AI applications to generative AI is driving unprecedented growth across cloud markets worldwide.

China’s experience mirrors global trends, where generative AI contributed significantly to the $330 billion global cloud market growth in 20241.

This transition represents a fundamental change in how businesses consume cloud services, moving from specific applications like optical character recognition and surveillance to more versatile large language model capabilities.

The timing aligns with broader market patterns. Generative AI began dominating demand in 2023, coinciding with ChatGPT’s mainstream adoption, altering enterprise cloud spending priorities1.

Computer vision services in China grew 34% to 8.1 billion yuan last year, demonstrating how traditional AI applications continue expanding even as generative AI captures attention.

2️⃣ Market concentration remains consistent despite rapid growth

China’s AI cloud market shows remarkable stability in competitive dynamics, with the top four domestic players maintaining approximately 80% market share over multiple years.