By Oliver Jones, CEO, Chayora Limited
Most people are only too aware of the recent emergence of China as the second largest, and soon to be, largest national economy in the world. Based on 2016 figures, the gap between the United States and China is still significant, $18.6 trillion versus $11.2 trillion, according to the World Bank. However, China represents a huge market that cannot be ignored, a 14.9 percent share of the world economy compared to the United States’ 24.7 percent. Growth continued at just under seven percent in 2017 and shows few signs of abating.
Today, nearly 800 million people in China have internet access, and this number is increasing with first-time users of the web numbering more than the adult population of the UK every year. Expectations are that more than one billion of the 1.4 billion people in China will be online within the duration of the next Five Year Plan. It is an enormous market representing more than 20 percent of the world’s online community today. Whilst GDP per capita in China is below Western markets, it is quickly rising, and the spending patterns of consumers across the country are compelling.
However, in terms of accessing the Chinese population for online services, the challenge is wholly different to any other major market in that the national firewall is highly effective, which means businesses wanting to participate in the huge and growing online markets of China must have servers present inside the firewall. This contrasts with any other major economy where servers can be in the U.S. or Europe, and access is enabled across the web.
We believe that failing to have a China strategy will be the Achilles heel of some of today’s largest technology firms and leading cloud services providers. Establishing presence in China is challenging, as the market and internet access is highly regulated, and the business environment is complex. However, through organisations such as Hong Kong-based Chayora, world-class data centre campuses have been created to enable international businesses to participate in a manner they find assuring and transparent. Our hyperscale developments in the Beijing and Shanghai regions will also be among the world’s largest data centre sites, reflecting ‘China-scale’ and dwarfing other prospective markets.
So, in summary, why should you consider establishing a data centre in China?
- China is the world’s biggest online market today and will grow to more than 1 billion people within the next few years.
- The online market in China continues to grow at extraordinary rates with more than 30 to 50 million new users coming online each year.
- The Chinese GDP per capita has increased dramatically to an average of approximately $10K per person and sits at over $18K per person in Shanghai and Beijing.
- Online users in China want e-commerce, social media access, document and photo storage, streaming videos, and gaming challenges. They are also rapid adopters of advanced IT, Virtual Reality, and the IoT. In other words, the same online services and emerging technologies as all other mature markets, but with the potential for exponentially more users, given the scale of China’s population.
- With our Tianjin campus serving Greater Beijing coming online by the end of 2018, Chayora can uniquely provide a solution to support this access today. Chayora is enabling China market access for major cloud and online services organisations with the same speed and reliability as they would experience anywhere else in the world.
To learn more about Chayora, click here.