A podcast directed towards the audience of investors both Chinese and Western in relation to establishing Cloud services in China.

Though there is unprecedented industry growth for Cloud services in the Western world there is significant lucrative opportunity cropping up in the Asian continent, specifically China. In order to properly conceive this advent of rising industry, there are several strengths as well as weaknesses to be taken into account in order to make educated investments. With a population of approximately 1.34 billion people in the nation, there is over an estimated 700 million and rising smartphone users and with the prices of these devices continuously dropping the consumption trend is likely to continue meaning there is over half and growing of the citizenry operating Cloud services in the Chinese market representing a significant strength for the business. Another strength aspect of the industry besides its large market demographic within China and increasing availability of Cloud capable devices is the rapid deployment that companies can experience when desiring to engage in business relations with Cloud providers who rent the requested storage space and processing power as needed, making Cloud services a venture in which steady and perpetual growth can be expected. (Shu) Keeping these strengths in mind, there are many weaknesses that need to be made aware of as far as the development of this business, with the first being the costly establishment of new operation centers and their maintenance. Creating a new data center with proper parameters in mind can exceed hundreds of millions of dollars and the usual development of these locations parallels with the idea that in order to avoid the possibility of natural disasters, such as earthquakes which are common throughout China, causing the disruption of operations other data centers need to be constructed throughout the region to minimize risks. Maintenance investments also scale upwards in price due to several factors with a prominent one being the power needed to be used for the operation of a single center and can be estimated to cost around 10 million dollars a year. (Greenberg) A third and major concern for the industry that has been needed to be continuously updated in order to be addressed are the issues that arise in terms of security of Cloud services. Just as the Cloud industry, as well as the general IT industry, continues to grow in capability there is a rising trend in cyber terrorism and computer hacking. As a result, when there are multitudes of companies utilizing these Cloud services there is a wealth of information to be exploited, thus many Cloud providers have embraced military-grade security systems to prevent these potential virtual espionage occurrences. (Khan) It is vital for both Western and Chinese investors to keep these strengths and weaknesses in mind when considering the enterprising Cloud industry within China.
For Western investors in particular, there are certain implications for the Cloud services industry in China that correlates with the presence of opportunities and threats which an awareness of would greatly assist in the decision-making process in determining market entry potential. As far as opportunities, the most prevalent include the growth of the Asian market for these businesses, a desire for foreign direct investment by the government of China, and a general lack of competition in the Chinese Cloud services market. In terms of global growth of companies utilizing the Cloud services industry there is an expected expansion of over two-thirds of all businesses and the corporate spending on developing these capabilities is to surpass $207 billion and an example of this trend can be seen in the Asia-Pacific region with a 21.1% increase in usage of social networking sites which are characterized by their dependency on Cloud computing. (Neisat) The current atmosphere for this sector in relation to the local government of China is that of a request for outside investment from companies overseas, with the request taking the form of an industry alliance drafted in order to increase cooperation and the introduction of ideas, technologies, and experience between government, enterprises, universities, research institutes, and the capital market. Finally there is the general lack of competition within the market as a result of the limited technical capacity China has displayed through systemic weakness in their software utilized, structural personnel problems through poor distribution of resources in existing domestic projects, and the absence of large enterprises capable of leading the industry. In regards to threats for the development of China’s Cloud potential through foreign enterprises there has been a lack of willingness to address core issues of strict Chinese government controls on the industry, security and protection of intellectual property rights, as well as key differences in the standardization of the Cloud concept between the United States and China. Chinese government controls on the industry in relation to foreign enterprises poses a significant threat to the potential for foreign investment as the government has made it clear that the only method of entry into their market is through the establishment of joint ventures between Chinese companies, most of which in some way or another are state-owned and have shown in the past to have little regard for respecting foreign company operations management. The potential security risks for foreign investors are numerous but perhaps the greatest is the nonconsensual procurement of proprietary content and knowledge transfer occurring through the joint ventures made with state-owned enterprises attempting to bolster not only civilian development but military capabilities as well, thus raising the question of whether or not there is to be longevity of Western companies pertaining to the Chinese market. In relation to the process of defining the Cloud services industry in China there have been stridently different approaches made on which organization possesses primary responsibility for defining the Cloud, with the distinction going back and forth between full government control to a more free market concept. This incompatibility between Chinese and Western Cloud definitions hinders the participation of multi-national firms in decision-making and implementation on the standardization of the technology. (Ragland) Western investors should carefully consider these factors when attempting to conduct foreign-entry practices into the Chinese market for Cloud services, and take necessary steps to ensure success of the industry.



Western Investors

A podcast directed towards the audience of investors both Chinese and Western in relation to establishing Cloud services in China.

虽然云服务在西方国家取得了有前所未有的行业增长。 在亚洲，尤其是在中国， 云技术赚钱的机会出现的越来越多了。 为了理性对待这个即将来临的新兴产业， 有几个优势和欠缺需要加以考虑，以便进行理性地投资。在一个拥有超过13亿人的国家， 据估计有超过700万并且还在持续增加的智能手机用户, 可是智能手机的价格却出现了下降的趋势。 这样的趋势意味着超过半数并且还在持续增加的民营云服务在中国市场有着举足轻重的地位。 除了拥有涵盖巨大人口市场和越来越强大的云计算能力以及日益普及硬件设备的优势外， 快速部署相关企业可以与云计算服务的提供者建立关系。当将这些优势牢记在心的时候， 同样也有很多弱点需要注意。 这一行业要发展，首先是建立新的运营中心和维修服务。 创建一个拥有适当参数的心数据中心可能超过上百万美元， 发展这些平行位置的通常想法是为了避免自然灾害， 例如地震在中国是常见的， 为了尽量减少构建风险需要在整个区域中断运营其他数据中心。 因为几个突出因素需要单个中心的操作并且预计耗资上百万万美元每年， 持续投资可以使价格走高。 一个被关注的第三产业需要持续的升级以便解决云服务在安全性方面出现的问题。 跟云服务行业一样， 普通IT 行业也在持续增长， 进而有能力对付持续增长的网络恐怖主义以及电脑黑客行为。 能够利用云服务的公司越来越多的时候， 云服务的开发者已经接受了军事级别的安全系统以防止这些潜在的网络间谍事件。 当考虑到在中国发展云服务行业时， 中西方投资者需要把这些优势和劣势牢记在心。 对中国投资者而言， 有类似大量的机会和风险是由在中国经济去的云服务造成的， 需要理解这一点，这样才能保证公司财务的稳定与平衡。 对行业的机遇而言， 需要考虑的方面是其他领域的行业在中国的利益经通过云服务的发展而实现 大大增加的中西方贸易潜能和发达国家的进步。 首先， 由于云服务的影响和移动通讯用户的持续增长， 业务如医疗保健，金融和电信等机构已经越来越多的使自己达到云计算的操作标准。 这些部门都在寻求用来抵消置于维护系统上所需的的移动是被用户简历业务关系， 从而满足人口不断上升带来的需求， 然后减少融资生产内部储存和处理能力的责任。 接下来， 云服务船业的建立将通过建立两者自检的共享数据中心， 从而去创造更多的需要建立在软件服务和其他IT领域关于维护云系统的业务。 最后，在过去数十年中国经历了难以置信的经济增长，近年来因为科技进步的原因， 有理由相信云技术在中国会扮演永久性发展的角色。 由于云技术前所未有的被认定是未来的新科技，所以拥抱云计算产业。 然而，需要考虑的是这些与云服务相关的机会对于行业来讲确实是个威胁。 例如， 国内机构开发这些功能时出现的障碍， 感受到西方企业对外国投资和对较差基础设施建立的能力。对于境内企业和机构一致公认无法分配所需的人力资本对成功实施云服务进行监督， 并且由于在这一领域普遍缺乏教育， 机构为了寻求建立这些服务已经造成了许多漏洞。 另一个投资潜力失败的事实是， 许多这一领域的行业领导有谁可以为创造这些能力提供必要的资源. 这取决于在中国的有关规定。 最后， 宽带的潜力对云技术资管重要， 最近监测显示平均每秒1463千字节每秒并且差不多比拥有云技术功能的国家慢了5倍。 为了确保云产业提供的可行性是可以实现的，必须实现妥善解决这些机会和威胁。
Though there is unprecedented industry growth for Cloud services in the Western world there is significant lucrative opportunity cropping up in the Asian continent, specifically China. In order to properly conceive this advent of rising industry, there are several strengths as well as weaknesses to be taken into account in order to make educated investments. With a population of approximately 1.34 billion people in the nation, there is over an estimated 700 million and rising smartphone users and with the prices of these devices continuously dropping the consumption trend is likely to continue meaning there is over half and growing of the citizenry operating Cloud services in the Chinese market representing a significant strength for the business. Another strength aspect of the industry besides its large market demographic within China and increasing availability of Cloud capable devices is the rapid deployment that companies can experience when desiring to engage in business relations with Cloud providers who rent the requested storage space and processing power as needed, making Cloud services a venture in which steady and perpetual growth can be expected. (Shu) Keeping these strengths in mind, there are many weaknesses that need to be made aware of as far as the development of this business, with the first being the costly establishment of new operation centers and their maintenance. Creating a new data center with proper parameters in mind can exceed hundreds of millions of dollars and the usual development of these locations parallels with the idea that in order to avoid the possibility of natural disasters, such as earthquakes which are common throughout China, disrupting operations other data centers need to be constructed throughout the region to minimize risks. Maintenance investments also scale upwards in price due to several factors with a prominent one being the power needed to be used for the operation of a single center and can be estimated to cost around 10 million dollars a year. (Greenberg) A third and major concern for the industry that has been needed to be continuously updated in order to be addressed are the issues that arise in terms of security of Cloud services. Just as the Cloud industry, as well as the general IT industry, continues to grow in capability there is a rising trend in cyber terrorism and computer hacking. As a result, when there are multitudes of companies utilizing these Cloud services there is a wealth of information to be exploited, thus many Cloud providers have embraced military-grade security systems to prevent these potential virtual espionage occurrences. (Khan) It is vital for both Western and Chinese investors to keep these strengths and weaknesses in mind when considering the enterprising Cloud industry within China.
In relation to Chinese investors there are also a large number of opportunities and threats presented to the Cloud services sector of the Chinese economy that should be understood in order to maintain a balanced perspective on the financial stability of the venture. For the opportunities of the industry, aspects that should be considered are the benefits that various other business sectors in China would realize through the development of Cloud services, the increased potential for enhanced trade relations between Western nations and China, and the improvement of the already high economic power displayed by the country. First, due to the implications of Cloud services and the continuous growth of mobile users, businesses such as health care, financial, and telecommunication institutions have been orientating themselves more and more towards a Cloud computing operating standard. These sectors are seeking to offset the strain placed on maintaining the systems necessary for the escalating population of mobile device users by establishing business relations to meet the demands and subsequently decrease the responsibility placed upon financing the production of internal storage and processing capabilities. (Chu) Next, the establishment of the Cloud industry would yield a betterment of relations between China and Western nations through the creation of linked data centers between the two, thus creating a larger capacity for more business as a result of the need to build on software services and other IT sectors pertaining to the maintenance of the Cloud system and the sectors that utilize it. Lastly the nation of China has experienced incredible economic growth over the past decades and with the stimulation of the technology industry over recent years in tandem with the role it plays in China’s perpetual growth, it would stand to reason that embracing the Cloud industry due to its ever-increasing acknowledgement as being the future of innovation for technology would add to the nation’s economic potential. However despite these opportunities associated with Cloud services there are certain threats to the business that need to be taken into account such as the hindrances experienced by domestic institutions developing these capabilities, the apprehension felt by western enterprises towards foreign investment, and the poor infrastructural capabilities possessed in effectively establishing these capabilities. For domestic firms and organizations there has been an acknowledged inability to distribute the necessary human capital to oversee the successful implementation of Cloud services and due to general lack education in this field there have been numerous oversights made by institutions seeking to create these services. Another failing of the potential for investment is the fact that many industry leaders of these sectors who could provide the necessary resources to create these capabilities are dissuaded by the immense regulations regarding operating in China as well as the high potential for domestic firms to abscond valuable trade secrets and intellectual property without providing compensation or establishing ethical alternatives such as increased potential for point-of-presence operations of wholly western run companies. Finally there is the poor bandwidth potential necessary for the Cloud services industry, with recent measurements averaging 1463 kilobytes per second and approximately five times slower than countries that have Cloud capabilities and this is further burdened by the government’s network monitoring requirements. (Ragland) In order to ensure that the investment viability presented by the Cloud industry is achievable these opportunities and threats need to be properly addressed beforehand.


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