The International Olympic Committee chose Alibaba as its exclusive provider of cloud services at the Beijing Olympics, even though the Chinese tech giant is regarded by the United States as a possible national security threat.
It is just one of an increasing number of controversial decisions the IOC has made.
Alibaba, founded by billionaire Jack Ma, is a massive and lucrative Chinese multinational company focused on e-commerce and technology. Its affiliate, Ant Financial Group, owned Alipay, a digital payment company with over 1 billion users. The company has been the subject of a power grab by Chinese President Xi Jinping and has been implicated in the Chinese government’s surveillance of the Uyghurs, against whom the U.S. says the Chinese Communist Party is conducting a genocide.
Meanwhile, America’s government has concerns about Alibaba’s possible threat to U.S. national security.
It was reported by Reuters last week that the Biden administration is scrutinizing Alibaba’s cloud services “to determine whether it poses a risk to U.S. national security” and that the review was partly focused on whether the Chinese government could gain access to or steal U.S. user data stored on the cloud. The outlet said that, following the Trump’s administration concerns, the review was launched during the Biden administration within the Commerce Department’s Office of Intelligence and Security.
“As a matter of policy, we do not comment on the existence or nonexistence of transaction reviews,” Commerce Department deputy press secretary Jeremy Edwards told the Washington Examiner.
The IOC announced at the World Economic Forum in 2017 that it was entering into a “long-term partnership” with Alibaba through 2028, with Alibaba joining The Olympic Partner sponsorship program and becoming the official cloud services and e-commerce platform partner for the IOC, as well as a founding partner of the Olympic Channel. Alibaba was the first Chinese company to commit to the Beijing Olympics.
“This is a ground-breaking, innovative alliance, and will help drive efficiencies in the organization of the Olympic Games through 2028,” IOC President Thomas Bach said.
Olympic Broadcasting Services and Alibaba Cloud announced the launch of the OBS Cloud in 2018. Alibaba was also named the ticketing systems and services provider by the IOC in 2019. Bach said at the time that “Jack is always giving me good advice and leading me in the right direction when it comes to the great potential this digital world is offering for us.”
The Olympics website points to Alibaba’s “exclusive” control over cloud infrastructure and cloud services.
An executive order by President Donald Trump in January 2021 stated that the U.S. “must take aggressive action against those who develop or control Chinese connected software applications to protect our national security.” The order banned transactions with a number of Chinese applications, including Alibaba’s Alipay. President Joe Biden revoked that executive order and two others by Trump that took aim at TikTok and WeChat in June, replacing it with his own order.
The Trump State Department announced a “Clean Network Initiative” in August 2020 aimed at safeguarding U.S. information against “malign actors” such as the CCP. The “Clean Cloud” element aimed to prevent data from being stored on “cloud-based systems accessible to our foreign adversaries through companies such as Alibaba” and others. Then-Secretary of State Mike Pompeo also named Alibaba as a specific potential problem.
The Trump administration sought to limit Alibaba’s reach in the U.S. in other ways too.
The Committee on Foreign Investment in the United States rejected efforts by Alibaba’s Ant Financial to merge with MoneyGram, reportedly over national security concerns related to the safety of U.S. financial data, with the Chinese Foreign Ministry and Chinese state-run media criticizing the U.S. decision.
The State Department also reportedly proposed adding Alibaba’s Ant Group to a trade blacklist in October 2020, in a move similarly condemned by China. The Trump administration reportedly shelved the move in November 2020.
Ma has largely disappeared from public view, and his plans to take the company public have been shelved since he gave a speech in Shanghai in October 2020 that criticized China’s financial regulators. Xi reportedly personally intervened to stop the company’s initial public offering after Ma’s speech enraged Chinese leaders.
Xi defended his clampdowns on Chinese business at the World Economic Forum this month. Chinese state-run China Central Television implicated Ma in a corruption scandal last week.
