Ur­ban­iza­tion opens new vis­tas for cloud com­pa­nies

China Daily (Canada) - - BUSINESS - By GAO YUAN

China’s am­bi­tious ur­ban­iza­tion plans are a newbusiness op­por­tu­nity for over­seas cloud com­put­ing com­pa­nies as lo­cal gov­ern­ments seek smarter ways to man­age their cities.

A sound mu­nic­i­pal ad­min­is­tra­tive plat­form is deeply needed be­cause pop­u­la­tion in­Chi­nese cities is surg­ing rapidly, in­dus­try ob­servers said.

“Mount­ing pres­sure in ur­ban ar­eas, such as air pol­lu­tion, traf­fic jams and crime, are a wake-up call for city plan­ners that a more sus­tain­able and sci­en­tific man­age­ment method needs to be im­ple­mented,” said Li Tie, di­rec­tor­gen­eral of the China Cen­ter for Ur­ban De­vel­op­ment. The or­ga­ni­za­tion works un­der the Na­tional De­vel­op­ment and Re­form Com­mis­sion, the coun­try’s top eco­nomic plan­ner.

Cloud tech­nol­ogy is a model of net­work com­put­ing where a pro­gram or ap­pli­ca­tion runs on a con­nected server or servers rather than on a lo­cal com­put­ing de­vice such as a per­sonal com­puter, tablet or smart­phone.

China is ex­pected to spend at least 2 tril­lion yuan ($322 bil­lion) on smart city ini­tia­tives by 2025, ac­cord­ing to in­dus­try re­search firm In­ter­na­tional Data Corp.

Cloud com­put­ing plat­forms give crit­i­cal sup­port to the smart city ini­tia­tive.

Over­seas cloud providers are ea­ger to tap into the emerg­ing mar­ket. They have teamed with Chi­nese providers to of­fer pub­lic cloud ser­vices in the coun­try be­cause for­eign com­pa­nies are not al­lowed to set up pub­lic cloud ser­vices in China.

Mi­crosoft Corp made its cloud ser­vices avail­able in China ear­lier this year by part­ner­ing with 21Vianet Group Inc.

Ama­zon Web Ser­vices Inc, the world’s largest cloud so­lu­tions provider, also joined with a num­ber of lo­cal gov­ern­ments to put their com­put­ing cen­ters in the coun­try.

Al­though roughly 70 per­cent of cloud in­vest­ment went to hard­ware in­stal­la­tions in China, soft­ware ven­dors were also able to get a cut of the multi-bil­lion-dol­lar mar­ket.

In late April, Ger­many’s SAP AG said its cloud busi­ness in China had clocked a triple-digit year-on-year growth in the first quar­ter be­cause of strong de­mand from the hu­man re­sources sec­tor. Mark Gibbs, pres­i­dent of SAP Greater China, said the com­pany will fur­ther ex­pand its cloud and other businesses in China and the com­pany’s en­tire cloud so­lu­tions will be in­tro­duced there by the end of the year.

The Ger­man com­pany is putting all its soft­ware­onHANA, a self-de­vel­oped data­base man­age­ment plat­form, to boost sales. Com­pany ex­ec­u­tives are sat­is­fied with the HANA project and are look­ing for a big­ger in­stal­la­tion rate of the plat­form.

Over­seas providers are poised to face strong chal­lenges from lo­cal cloud com­pa­nies though. In­ter­net firms such as Alibaba Group Hold­ing Ltd and Baidu Inc of­fer cheaper cloud-based ser­vices and are rapidly gain­ing mar­ket share.

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