Kingsoft, founded in 1988 as one of the first software development companies in China, announced yesterday that it would invest more than US$1 billion in its cloud business in the next three to five years.

The company has jointly invested in 21Vianet, a Chinese network-neutral data center service provider, together with Xiaomi, whose CEO Lei Jun is also the chairman of Kingsoft. Kingsoft has acquired 11.6% of 21Vianet for US$172 million.

Mr. Lei convinced Kingsoft board of directors to invest the US$1 billion they had sitting in the bank into cloud technology, saying this area is the future and now is a good time to invest, according to Xiaomi. He bets Kingsoft will be one of the top five Cloud service providers.

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Tracey Xiang

Tracey Xiang is Beijing, China-based tech writer. Reach her at traceyxiang@gmail.com