Beijing’s ambitious plans for cloud computing

1 August 2017

Beijing’s ambitious plans for cloud computing

By 2019, China wants two or three of its national businesses to dominate the cloud computing sector.

China doesn’t want to be kept away from the rapid development of cloud computing and the explosion of data volume — nor to allow the sector to develop at the detriment of the country’s own businesses. While the sector grew nearly 30% in 2015, the Chinese authorities have just determined a roadmap for the next three years. 

According to a report released by the ministry of industry and information technology, Beijing hopes that the value of the cloud computing industry, currently worth 150 million yuan (about $22 million), will be two and a half times greater in 2019, reaching a value of 430 million yuan.

Financial effort and local administration

Beijing says it will encourage mainly small and medium-sized enterprises, but also local administrations, to make more use of this technology and use it to introduce services for the greater public. To this end, the Chinese authorities also promise to invest more in financing, training and promotion. This is all part of the greater project of developing the new Silk Road.

At the heart of the efforts, which expand on those of the “Internet Plus” plan launched in 2015, Beijing hopes that this development will benefit mainly local companies, and that by 2019, two or three Chinese companies will rank among the leaders dominating the global sector, thus overcoming the American supremacy currently at play.

Huawei propelled into top 5 globally in 2016

Beijing has been careful not to name the country’s most serious contenders, but the list of potential candidates is easy to draw up: Alibaba and Baidu, which already offer services that compete with Amazon for example, but also Huawei.

In 2016, the Chinese brand best known for its smartphones saw its sales of cloud equipment (not including software) increase by more than 62%. This propels it into the fourth place globally, dethroning IBM, NetApp and Lenovo.

An impressive progression that must nevertheless be viewed in context. With the equivalent of $1.2 million in sales, Huawei remains three to five times smaller than the American leaders Dell ($5.7 million), HP ($5.3 million) and Cisco ($3.8 million).

All rights reserved: Les Echos/Worldcrunch : By Claude Foquet

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