ibusinesslines.com
ibusinesslines.com November 17, 2017


AWS Sells Chinese Cloud Assets Amid Tightening Regulations

14 November 2017, 06:03 | Kelvin Horton

Amazon surrenders cheapest bit of Chinese cloud

Amazon's AWS business is reportedly pulling out of China

Amazon is committed to establish in China, and is looking forward for significant business opportunities and growth potential for the next few years.

Amazon will still possess the intellectual property for its AWS services.

"Chinese law forbids non-Chinese companies from owning or operating certain technology for the provision of cloud services", AWS said, according to The Wall Street Journal.

The company's Chinese partner, Beijing Sinnet Technology Co LTD, revealed that it would buy AWS' public cloud computing unit in China for just over $300 million in a recent filing.

A Cyber Security Law (CSL) came into effect back in June, requiring certain companies to hold data within China and to undergo on-site security laws.

The transaction's goal is to fully comply with China's laws and regulations, while improving the security and service quality of Sinnet's operation of Amazon Web Services.


Amazon signed a deal in August 2016 to allow Chinese partner Sinnet operate the Amazon services provided by Amazon Web Services (AWS) in China.

"This move is mostly around regulatory compliance", said Charlie Dai, Beijing-based analyst at Forrester Research.

Sinnet has told customers it has been told by the government to close VPNw which circumvent the Great Firewall. AWS runs a separate hardware venture in collaboration with the Ningxia provincial government in China's northwest, according to Reuters.

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.

Due to increased regulations surrounding online data in China, Amazon has announced that it will sell off the hardware now powering its public cloud business in the country.

On Monday, Amazon shares closed up 0.34% at $1,129.17.



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