Global players rush to meet local demand
Foreign cloud computing companies are scrambling to expand their presence in China, where more and more businesses are embracing cutting-edge technologies to improve their corporate management and production efficiency.
Microsoft Corp said it had tripled its cloud capacity in the country to grasp the opportunities brought about by stronger-than-expected demand from local companies.
The company said in March it would add two cloud regions and two data centers in China for the 110,000 customers it serves there, as well as the greater numbers it expects in the future.
The move came after the US tech giant announced its triple-increase plan late last year, as China’s digital transformation gains momentum and the authorities have called for more intensified efforts to develop advanced technologies, including big data, cloud computing and artificial intelligence.
“China’s digital transformation has developed at an unprecedented speed, and has created huge and valuable opportunities. The Chinese market has become one of our largest markets globally,” said Kang Rong, vicepresident of Microsoft China.
Microsoft commercialized its Azure Stack hybrid cloud solutions in China in April, provided in collaboration with hardware makers such as Dell EMC. The solution aims to meet companies’ growing demand for local data centers with more flexible computing capability.
Kang said Microsoft is ramping up efforts to not only help companies locally but also globally, assisting them in going abroad.
“It is inevitable that Chinese enterprises will encounter problems when going overseas, including data storage and efficient data operation,” said Zhang Zhenyuan, head of information technology at Spring Airlines, China’s first and largest budget carrier.
“In Japan, Microsoft Azure has accelerated the speed of our website and reduced operating costs by more than 30 percent,” he said.
Microsoft’s expansion plan comes as the company is locked in fierce competition with Amazon.com Inc, Alibaba Group Holding Ltd and Huawei Technologies Co Ltd in China’s booming cloud computing sector.
Amazon’s cloud service platform, Amazon Web Services, announced in December that it had inked a strategic partnership with a local cloud service provider in the Ningxia Hui autonomous region of Northwest China to offer customer services.
This followed a month after AWS announced it will sell the cloud servicerelated assets of its Beijingregistered cloud unit for up to 2 billion yuan ($316 million) to its Chinese partner Beijing Sinnet Technology Co Ltd.
The move complies with Chinese regulations — which only allow Chinese companies to run data centers in the country — and aims to further improve the service’s security.
“Coupled with the AWS China (Beijing) region, the second AWS China region will serve as the foundation for new cloud initiatives in China, especially in western China, helping to transform businesses, increase innovation and enhance the regional economy,” said Andy Jassy, CEO of AWS.
So far, domestic tech heavyweights such as Lenovo Group Ltd, TCL Corp, Midea Group and Xiaomi Corp and some fast growing startups have used AWS cloud services to power their infrastructure and make them more agile with lower costs.