Alibaba is one of China’s largest companies whose success and growth generated distrust within the Chinese Communist Party.
A new Alibaba restructuring sees CEO Daniel Zhang resign from his post in favor of Eddie Wu. Alibaba is one of China’s largest technology companies whose power and influence over the sector caused wariness in the Chinese Communist Party.
The CCP cracked down on Alibaba’s founder and former CEO Jack Ma. Once Asia’s richest man, Ma was "convinced" to split his powers and share them with the CCP.
Eventually, Jack Ma left China in disgrace, apparently living between Japan and Singapore.
Alibaba used to be the world’s largest e-commerce site. However, when Daniel Zhang took over in 2015, the company slowly drifted into the cloud business.
Zhang believes that the latest developments in generative artificial intelligence have the potential to provide cloud services with new, untapped possibilities.
A few months ago, Alibaba launched Tongyi Qianwen, its own Large Language Model (the technology used in the most recent AI software including ChatGPT). Instead of large public availability, however, Tongyi Qianwen was designed for business-to-business operations, particularly in the finance and petrochemical industries.
It is expected that Alibaba’s artificial intelligence software will also be integrated into its internet services in the near future. Furthermore, incumbent CEO Daniel Zhang will retain his position as CEO of cloud services.
A larger reshuffle
But Alibaba’s structural reorganization is much larger than the simple CEO role.
In March, the Chinese tech giant announced an upcoming division into smaller entities, each managed by a CEO and a different team.
The split-up is most likely determined by the CCP crack on large companies, which as we said targeted Alibaba already in the past.
E-commerce will be incorporated within Taobao Tmall Commerce Group, whereas cloud-based services will be part of the Cloud Intelligence Group, which will take over the role of the e-commerce app. The other businesses will be divided into four additional entities.
Daniel Zhang cited the "uncertain economic landscape" as the reason behind the restructuring, with increasing "challenges and opportunities" forcing a radical move.
Eddie Wu will take Zhang’s place as overall leader while also retaining his CEO role at Taobao Tmall. Wu has been at Alibaba since its early beginnings, starting as technology director. In 2004, he became the Chief Technological Officer of Alipay, later designing the Taobao Tmall app.
Executive Vice-Chairman Joseph C. Tsai will instead be promoted to Alibaba’s Chairman. Both Wu and Tsai will officially start their roles on September 10th.
Overall, this will be Alibaba’s largest restructuring since its foundation in 1999.
