Tencent has revealed it will invest 10 billion yuan ($1.57 billion USD ) over the next five years to boost a multi-national cloud computing operation across North America, Hong Kong and China.
The online social and gaming giant is looking to boost its presence in the cloud computing field as other internet giants, Alibaba and Baidu, are also expanding. Tencent entered a MOU with IBM in November last year to extend their presence in corporate cloud computing.
Alibaba’s cloud computing department, Aliyun, has also agressively expanded its operation outside of China. In March, they launched their first U.S.-based data centre in Silicon Valley. Last month they launched a strategic centre in Singapore, at the time Ethan Yu, VP of Aliyun told CNBC that the company is looking to make the Singapore centre the biggest outside of China.
In December last year, one of China’s oldest software companies, Kingsoft, announced a $1 billion USD investment in also extending their cloud services over the next five years.
The expansion into overseas markets by some of China’s biggest players signals their readiness to take on world leaders Microsoft Azure and Amazon AWS in cloud computing. Both foreign companies have already established a presence in China, with Microsoft launching a new entity, Microsoft Asia-Pacific Technology Company Ltd., to take over management of local cloud operations.
Smaller companies are also gaining momentum in China, putting pressure on the internet giants in their own market. Qiniu, a cloud service provider established by former Kingsoft researchers sealed an undisclosed investment from a series of prominent investors last month, while UCloud, founded by ex-Tencent executives, landed a $100 million USD C series led by Legend Capital in April.
While Tencent’s recent cloud service expansion has focussed on the more profitable commercial sector, they have also made steps into the consumer cloud space. In January this year they launched a highly modified version of their original ‘Micro Cloud’ (Weiyun) personal cloud storage platform. The company has since integrated the service into their existing social platform and other QQ operations.