Amazon has struck a deal to provide cloud services for businesses in China as a pilot project starting in early 2014, the company announced on Wednesday.
Local Chinese partners ChinaNetCenter will provide data center space and Sinnet will deliver the service, which will be used by a “select group” of China-based and multinational companies.
Amazon signed a memorandum of understanding with the governments of Beijing and Northwestern Ningxia region, allowing it access to the heavily regulated market. The Ningxia government not only approved the AWS pilot project, but is also a participant, as some of its public services will be delivered through the Amazon cloud.
“This will help fully utilize data center and infrastructure resources in Beijing and Ningxia, and provide highly reliable and secure cloud services to millions of Chinese customers,” Yuan Jiajun, executive vice chairman of the Government of Ningxia Hui Nationality Autonomous Region, said in a statement.
Amazon has been providing cloud services to some Chinese customers, those services used internationally tailored services with overseas infrastructure, whereas they will now be able to store data in China, which should reduce latency issues.
Existing Chinese AWS customers include smartphone company Xiaomi Inc. and biotech company Tiens Group Co. Ltd.
“China represents an important long-term market segment,” said Andy Jassy, head of Amazon’s Web Services.
By partnering with local players and gaining official approval, Amazon moves onto the home turf of giant ecommerce competitor Alibaba Group. Alibaba’s own cloud computing arm branched into cloud for financial services companies in late November, launching Ju Baopen to bring online banking to Chinese consumers.
A Forrester report released in September predicted huge ecommerce growth in China over the next several years. Gaining access to the market, however, has been a challenge for foreign companies. Partnerships with Chinese companies who have already met regulatory requirements have been necessary for all major cloud providers moving into China.
Microsoft gained access to the Chinese market for its Windows Azure platform by partnering with Chinese company 21Vianet earlier in the year. 21Vianet is also the local partner for IBM SmartCloud Enterprise+, in a deal announced almost simultaneously with the Amazon announcement.