Amazon to expand its cloud computing business in China to compete against Alibaba
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According to a Reuters report, Amazon said it would expand its cloud computing business in China with a local partner. This means Amazon will be determined not to give up the Chinese market, although there are a lot of regulations and strict controls on the operation of foreign technology companies.
Many giant corporations such as Google or Facebook had to withdraw from this increasingly crowded and highly regulated market because of the tough regulations of the Chinese government, while the local companies have got great supports and had great potential to compete against foreign ones.
“AWS has formed a strategic technology collaboration with NWCD (Ningxia Western Cloud Data Technology), and NWCD operates and provides services from the AWS China Ningxia Region, in full compliance with Chinese regulations,” Amazon said in a statement.
The move comes a month after AWS said it will sell the hardware assets of its Beijing-registered cloud unit for up to 2 billion yuan ($302.06 million) to its partner Beijing Sinnet Technology Co Ltd to comply with new regulations.
China launched strict new regulations for foreign technology and internet companies in June that require foreign firms to store data locally and outsource hardware elements to local partners.
China has been a huge and potential market for cloud computing business in recent years. However, Chinese firms account for roughly 80 percent of total cloud services revenue in China, according to Synergy Research Group.
However, Amazon will not be willing to give up. While Amazon complying to the new regulations of the Chinese government, all data centers here will be owned by Amazon partners. Amazon will only a technology supporter and service provider.
One of AWS's biggest opponents in the Chinese market is Alibaba, who has recently opened dozens of new data centers in recent times and occupied more and more cloud market share. Amazon will surely face many challenges and difficulties when competing against Alibaba.
By: Christina Baker