Stock Markets April 8, 2026

Alibaba and China Telecom Open Shaoguan AI Data Center Using Domestic Zhenwu Chips

Initial deployment of 10,000 in-house Zhenwu AI processors supports very large models and can scale to 100,000 chips

By Leila Farooq
Alibaba and China Telecom Open Shaoguan AI Data Center Using Domestic Zhenwu Chips

Alibaba and China Telecom have launched a new AI-focused data center in Shaoguan, Guangdong province, powered by Alibaba's self-developed Zhenwu AI semiconductors. The cluster begins with 10,000 chips designed for AI training and inference, is capable of running models with hundreds of billions of parameters, and is planned to expand toward a 100,000-chip footprint. The partners say the facility can serve applications ranging from healthcare to advanced materials amid broader efforts in China to build domestic chip alternatives as access to some foreign semiconductor technology has been restricted.

Key Points

  • Alibaba and China Telecom have opened a Shaoguan data center powered by Alibaba’s Zhenwu AI semiconductors, starting with 10,000 chips.
  • The computing cluster supports AI models with hundreds of billions of parameters and is planned to expand to a 100,000-chip scale.
  • The partners say the cluster can serve industries including healthcare and advanced materials; the rollout aligns with a broader push for domestic chip alternatives amid U.S. technology restrictions.

Alibaba and China Telecom on Tuesday unveiled a new data center in Shaoguan, in China’s Guangdong province, that runs on Alibaba’s in-house Zhenwu AI semiconductors. The facility’s initial computing cluster uses 10,000 Zhenwu chips crafted for both AI model training and inferencing, and the partners indicated the installation can handle AI models containing hundreds of billions of parameters.

According to the announcement, the site is designed with growth in mind - the computing footprint is expected to scale up to 100,000 Zhenwu chips. China Telecom and Alibaba highlighted that the cluster’s computing power will be available to multiple industry use cases, explicitly citing sectors such as healthcare and advanced materials as potential beneficiaries.

Alibaba develops its processor technology through its T-head unit. The company, headquartered in Hangzhou, is also among China’s major cloud computing providers. Its cloud division markets AI models, and that business has been identified by the company as one of its faster-growing segments in recent reporting.

The Shaoguan deployment comes as Chinese companies accelerate development of domestically produced semiconductor options. The announcement noted this shift in context of restrictions from the United States that have limited China’s access to certain semiconductor technologies, including AI chips supplied by some foreign vendors.

Industry observers will note this launch follows other recent domestic deployments: last month, a computing cluster built with Huawei’s Ascend 910C AI chips was brought online in China. Both developments underscore continuing investment by Chinese technology firms and carriers in homegrown AI hardware.

For now, the Shaoguan facility’s public description focuses on its technical capacity, the planned scale-up path, and the range of commercial applications the computing cluster is intended to support. Details beyond those points were not provided in the announcement.

Risks

  • Uncertainty around the pace and extent of the planned expansion to 100,000 chips - impacts cloud infrastructure and datacenter investment decisions.
  • Constraints on access to certain foreign semiconductor technologies could affect supply chains and performance tradeoffs for AI deployments.
  • Limited public detail in the announcement leaves questions about commercial availability, pricing, and integration with existing cloud services.

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