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giftedviz.com November 21, 2017


Amazon sells off China cloud assets as tough new rules bite

15 November 2017, 12:51 | Austin Hogan

Amazon to sell China cloud services unit in $300 million deal

Amazon to sell China cloud services unit in $300 million deal

Microsoft already operates its Azure cloud service in China with the China-based company 21Vianet Group.

"AWS did not sell its business in China and remains fully committed, " the company said in an emailed statement.

Chinese regulators are tightening rules on foreign data and cloud services, implementing new surveillance measures and increasing scrutiny of cross-border data transfers.

Both the Wall Street Journal and Reuters had reported that the China partner had notified investors that it was about to buy AWS's China business for 2 billion yuan ($301.2 million).

Amazon said AWS continues to own the intellectual property for Amazon Web Services worldwide.

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The e-retailer added that it sold its physical assets of AWS to Sinnet in order to comply with the Chinese law. 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.

AWS has a separate hardware venture in partnership with the Ningxia provincial government in China's northwest.

However, like its peers, Amazon has found it hard making headway in China, which is dominated by local tech giants Alibaba and Tencent Holdings Ltd. AWS is significantly ahead of the competition across the world, but in China it must operate via local partners due to regulation.

Amazon's decision casts a shadow over similar ventures in the country. Foreign firms there have long complained about local restrictions that appeared to favor domestic players. But the USA 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.

Sinnet owns eight data centres with more than 40,000 racks, according to its listing on AWS's partner directory.



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