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By Josh Horwitz

SHANGHAI, Oct. 19 (Reuters) – Chinese tech giant Alibaba Group Holding Ltd said on Tuesday it has developed a processor that will be used to power servers in its data centers.

The development marks the latest foray into semiconductors for the company, mirroring the moves of other global cloud computing players while also aligning with the Chinese government’s priorities to boost the country’s chip industry.

Developed by Alibaba’s internal T-Head semiconductor unit, the chip – the Yitian 710 – is based on the architecture of the British company Arm Ltd, and will not be available for commercial use outside of Ali Baba.

Alibaba is the largest cloud computing provider in China by market share and the third largest in the world, according to research firm Gartner.

Its industry competitors have also launched their own server chips. Huawei Technologies Co Ltd and Amazon.com Inc rely on their respective Kunpeng and Graviton chips to power their cloud computing infrastructure.

Alibaba also said it has developed a line of proprietary servers, called Panjiu, and added that it will make the source code for its Xuantie IP core series – based on the open source RISC-V architecture – available to the public. Alibaba unveiled the Xuantie in 2019.

The Chinese government has long urged the industry to invest in the domestic chip sector, which lags behind its global counterparts.

The country remains dependent on foreign companies for much of its advanced semiconductors, a vulnerability highlighted when US sanctions against Huawei crippled the company’s booming smartphone business.

In addition to Alibaba, search giant Baidu Inc, phone maker Xiaomi Corp, and a number of Chinese auto and appliance companies have started investing in chips. (Reporting by Josh Horwitz; Editing by Himani Sarkar and Uttaresh.V)