Alibaba Shuts Down its Quantum Computing Effort

By John Russell

November 30, 2023

In case you missed it, China’s e-commerce giant Alibaba has shut down its quantum computing research effort. It’s not entirely clear what drove the change. Reuters’ reported earlier this week that Alibaba “cut a quantum computing laboratory and team from its research arm, donating both the lab and related experimental equipment to Zhejiang University.”

Alibaba was a relatively early entrant among giant e-commerce/cloud providers into quantum computing research, placing the effort in its Alibaba’s DAMO Academy research organization. There are reports it had invested on the order of $15 billion in the effort. According to the Reuters report, about 30 employees are being released with and effort under way to find positions for them at Zhejiang.

Rather than being tied to specific issues with the quantum research, the prevailing opinion seems to be that the quantum work was caught in the larger turmoil surrounding Alibaba and its ongoing reorganization. The company said its DAMO organization will deepen its work on AI and machining learning research which may be able to have a nearer-term impact on Alibaba’s business.

Macro concerns, including recent U.S. semiconductor export restrictions, are also a likely factor. The Wall Street Journal reported earlier this month that Alibaba scrapped plans “to spin off and list its cloud-computing division, citing the impact of the export controls that took effect late last month. The restrictions “may materially and adversely affect” the cloud business’s ability to offer products and services and to perform under existing contracts, Alibaba said, adding that it would focus on the division’s growth.”

It may be the quantum effort was seen as not likely to have a business impact soon enough while Alibaba sorts through core business issues and reorganization. Meanwhile, the big U.S.-based cloud providers – AWS, Azure, and Google – continue forging ahead with the quantum computing plans.

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