US cloud companies face stiff competition from China

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Huawei logo. Photo: AFP/VNA

Key Chinese companies such as Alibaba, Huawei and Tencent are planning to invest hundreds of millions of dollars in the Southeast Asian market in the coming years. Meanwhile, cloud services of Amazon and Microsoft still dominate in terms of market share, especially in the Singapore market (Singapore).

But observers point out that Chinese companies have penetrated emerging markets in Southeast Asia such as Thailand and Indonesia before their US rivals. With prices 20% to 40% lower than US companies, Chinese computing businesses have successfully attracted these price-sensitive customers.

In Southeast Asia, both Alibaba, Huawei and Tencent have more availability zones than Amazon Web Services, Microsoft Azure or Google Cloud. In the segment of cloud infrastructure services, Chinese companies have surpassed Google in market share in Thailand.

Southeast Asia is a priority market for many Chinese companies, including cloud computing companies, according to market research firm Gartner. Because they see better profit turning opportunities there than developed markets like the US and Europe. In contrast, in developed markets, Chinese companies will face more scrutiny.

According to Singapore-based research firm Twimbit, the leading position of US companies in Southeast Asia will not change rapidly, but Chinese companies will increase competition in the long run. Chinese companies are also investing in training local talent to familiarize them with China’s ecosystem and technology infrastructure.

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