Microsoft brings Windows Azure to China – is this the start of a new era?

Charlie Dai
Principal Analyst
May 28, 2013

Back in October 2011, Microsoft named the initiative to introduce Windows Azure cloud platform into the Chinese market “Moon Cake,” which represents harmony and happiness in Chinese culture. On May 23, 2013, Microsoft made the announcement in Shanghai that Windows Azure will be available in Chinese market starting on June 6 —  almost half a year after its agreement with Shanghai government and 21ViaNet to operate Windows Azure together last November. Chinese customers will finally be able to “taste” this foreign moon cake.

I believe that a new chapter of cloud is going to be written by a new ecosystem in China market, and Microsoft will be the leader of this disruption. My reasons:

  • The cloud market in China will be more disrupted. Due to the regulatory limitations on data center and related telecom value-added services operations for foreign players, the cloud market for both infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS) has been an easy battlefield for local players, such as Alibaba/HiChina. Microsoft’s innovative way working with both government and local service partners to break through this “great wall” shows all of the major global giants, such as Amazon.com, the great opportunity from this approach to the Chinese market. We can anticipate that they will also enter the Chinese market in the coming six to 18 months.
  • Microsoft’s launch will trigger customer awareness and investment.  In my report PaaS Market Dynamics in China, 2012 To 2017, I forecast that the Chinese government has a strong need to invest in cloud computing to drive economic growth. End users are pretty clear about the scalability and cost-effectiveness of cloud but lack examples of innovative business practices that leverage the cloud. The real customer success cases showcased in the Shanghai event by Microsoft and other partners, such as the Cloud ERP K/3 from Kingdee, Internet TV broadcasting service from PPTV, automobile connected service from Qoros, and business card service integrated with Microsoft Office 365, all architected over Windows Azure, will boost customer awareness and corresponding investment.
  • The cloud ecosystem in China will be transformed. End users in China market lack highly skilled DevOps professionals for cloud enablement. In comparison with VMware’s proactive initiative to build up community and reputation on its Cloud Foundry, Microsoft seems to be conservative. With the availability of Windows Azure starting from the public cloud, I expect that Microsoft will fully leverage its huge developer base around .NET and Windows in China and transform them into cloud-enabled experts to support the public and private cloud initiatives. On the other hand, I believe a new set of ISVs and partners will emerge and take up market share by leveraging the power of Windows Azure locally and globally.

What do you think about the future of Windows Azure? Will it help Microsoft to win the battle in China and globally? What, if anything do you see missing from Microsoft’s announced plans?

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