Alibaba, the Chinese multinational technology company, has announced it would be doubling down on cloud computing with an Rmb200bn ($28bn) three-year investment plan as the novel coronavirus (COVID-19) pandemic fuels demand for internet technologies and infrastructure that enables computing from anywhere.

One of the world’s top cloud providers, Alibaba said it would spend the money to build next-generation data centers and build related technologies including servers and semiconductors. The cloud business of Alibaba and work from home tools like DingDing, a workplace chat app, have received a huge boost from the COVID-19 outbreak with many people working from home.

Jeff Zhang, president of Alibaba Cloud Intelligence, remarked the COVID-19 pandemic has posed additional stress on the overall economy across sectors, but it also steers us to put more focus on the digital economy. In recent years, Alibaba has accelerated its cloud spending as it maneuvers to gain control of the market of China. It had 46 percent of the market in the fourth quarter while Tencent Cloud had 18 percent and Baidu Cloud had 8.8 percent.

Cloud Computing is one of the fastest-growing businesses of Alibaba with revenue in the fourth quarter increased 62 percent year on year to Rmb10.7bn, contributing 7 percent of total revenue. The segment of Alibaba’s cloud services reported negative Rmb356m of adjusted earnings before interest, tax, and amortization in the fourth quarter.

John Choi of Daiwa Capital Markets remarked the large cloud business expenditure made sense. Choi added the enterprise part of the ecosystem still has much room for growth versus the consumer part of the internet. Choi also remarked profitability will obviously be an issue in the near term but once it hits a certain scale, it could be a decently profitable business.

The eCommerce business of Alibaba in the consumer market faces competition from upstart Pinduoduo and longtime competitor JD.com.