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emfizz.com November 24, 2017


AWS Sells Chinese Cloud Assets Amid Tightening Regulations

15 November 2017, 12:55 | Jan Cross

AWS sells China hardware to local cloud partner

Amazon surrenders cheapest bit of Chinese cloud

Amazon has been forced by new regulations passed in June to sell its China-based AWS assets to Beijing Sinnet Technology for $300 million.

Amazon.com Inc. agreed to sell some of its Chinese cloud assets to its local partner but said it's committed to a domestic market for internet-based computing that could be worth $30 billion.

"‎We're excited about the significant business we have in China and its growth potential". Amazon has not yet provided the reason behind this exit, but it may be due to the tightening rules on foreign data and cloud services by Chinese regulators. In China, regulations require Amazon to operate via a local partner before offering the services to customers. If the company intends to continue functioning in China, it has to cooperate with local partners, that often have some degree of government oversight, an AWS spokesman explained.

"AWS sold certain physical infrastructure assets to Sinnet", it said. In August, Sinnet told customers it would shut down VPNs and other services on its networks that allow users to circumvent China's so-called Great Firewall system of censorship, citing direct instructions from the government.

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Amazon's decision casts a shadow over similar ventures in the country. But the US company has to deal with lawsintroduced this year that mandate the storage of data within the country and bolster government control over the movement of information.

More recently, telecoms equipment giant Huawei announced plans to take on AWS and Alibaba with its own cloud platform. Cloud services have become a crowded and competitive field in China in recent years, with Alibaba Group Holding Ltd's cloud unit opening over a dozen overseas data centres since 2016.

Whereas AWS is the public cloud leader globally, it has struggled to crack a Chinese market that has traditionally been served by its own tech firms.



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