Microsoft is readying the public preview of its Windows Azure service in China, and will make it available on June 6 through its local partner 21Vianet, which will operate the platform on behalf of the software giant.
According to the Redmond-based software vendor, this makes it the first multinational company to offer public cloud services in China. The China Information Industry Net (CNII), which is operated by the Ministry of Industry and IT, had earlier projected the public cloud services market in the country to be worth 6.3 billion yuan (US$1.01 billion) by 2013.
In an interview with ZDNet Wednesday, Doug Hauger, general manager of Windows Azure at Microsoft, said the partnership with 21Vianet meant customers could enjoy the benefits of working on an "identical platform" in China as they would with the global version.
"There is an enormous Microsoft developer ecosystem and growing open source ecosystem in China, which will find it easy to develop applications on Windows Azure"
- Doug Hauger, GM for Windows Azure, Microsoft
Even for multinational companies looking to use applications developed on Microsoft's platform-as-a-service (PaaS) in China, they can now host these apps on 21Vianet's datacenter without having to do any "technical work" to ensure these are operational once migrated over, he explained.
Asked why Microsoft could not offer the Windows Azure service on its own in China, Hauger said local laws such as the requirements stipulated to offer Internet data center services meant only a Chinese company can set up and operate a cloud computing platform. In fact, Microsoft has no access to the 21Vianet's data center hosting its Azure service unless its partner agrees to access and only to provide support and troubleshooting knowhow, he added.
In terms of the financial arrangements of the partnership, the general manager said 21Vianet is given a "service fee" to operate the Windows Azure platform. Additionally, the Chinese company has the opportunity to generate further revenue by offering value-added services on top of the PaaS offering to Chinese customers which have the "hunger and thirst" for enterprise-class cloud services.
He, however, declined to comment on how Microsoft will financially benefit from the 21Vianet partnership. Instead, he gave a wider industry prognosis saying the partnership will help boost the adoption of Microsoft services in China and how the software giant had the "obligation" to support and expand the local ecosystem of innovation.
"There is an enormous Microsoft developer ecosystem and growing open source ecosystem in China, which will find it easy to develop applications on Windows Azure," the executive added.
Chinese companies which are already using the Windows Azure platform include social networking site Renren, online video streaming service provider PPTV, software house Kingdee and automobile maker Qoros, the company stated.
Helping MNCs stay compliant
In a statement released Wednesday, Microsoft said it had helped train and certify almost 100 employees at 21Vianet to support customers' cloud computing needs, including Windows Azure. Hauger said the 100 are specially trained, but the rest of the staff at 21Vianet are able to field general enquiries regarding the cloud computing services should the need arise.
Last November, Redmond revealed the licensing deal with datacenter services provider 21Vianet to provide Chinese customers direct and legal access to Office 365 and Windows Azure services. It also inked a deal to provide these cloud services to the Shanghai municipal government through a new data center that was to be built and managed by 21Vianet.
Since then, the Chinese datacenter operator has started work on building one of China's largest data centers in Daxing which is in the southern district of Beijing. The 42,000-square-meter facility is expected to be completed by end-2013 and will be used to power Microsoft's commercial cloud services, which would likely include Windows Azure.
It is through these local data centers that will give Microsoft an edge in servicing global companies with a presence in China. Hauger said customers now have the option of hosting their Azure-based business applications and data in China, which allows them to adhere to local laws.
Microsoft is now placing more emphasis on overcoming the data sovereignty hurdle, particularly in Asia-Pacific.
The software vendor on Tuesday said it will be launching its Australian data centers to host Windows Azure locally, with two new sub-regions in New South Wales and Victoria due to come online soon. Toby Bowers, the server and tools business group lead at Microsoft Australia, said depending on a range of customer scenarios, data sovereignty is a concern for certain customers in the country.
[UPDATE May 23, 2 p.m.]: Microsoft on Thursday also announced it will be designating Japan as a major region to support its Windows Azure expansion into the region. It will be split up into two local sub-regions in Tokyo and Kansai area in west Japan.
"This new major region will offer additional capacity and flexibility to serve the rapidly growing market, estimated tobe 27.8 percent CAGR (compound annual growth rate) by 2017, for cloud computing services in Japan," the company stated in the press release.
Asked when the two sub-regions will come online, Hauger told ZDNet the company is working hard to have these datacenters operational but did not disclose specific dates. Microsoft said customers can continue to use the Hong Kong and Singapore sub-regions until Japan is ready.
Together with the Australia announcement, these new regions will offer Japanese and Australian customers all the benefits of Windows Azure plus the disaster recovery, data sovereignty and improved performance benefits of local deployments, said Satya Nadella, president of the server & tools business at Microsoft, in a blog post Wednesday.