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China cloud market growing, but still smaller than Microsft Azure

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(Image credit: Image Credit: Everything Possible / Shutterstock)

After the cloud’s big three – AWS, Azure and Google Cloud – all of the attention usually shifts to Chinese vendors. Canalys’ fresh reports are stating that cloud providers from the far East grew by 65 percent in the third quarter of the year, raking in approximately $5 billion in revenue for the period.

The market analysts are saying the companies spent $750 million more, compared to the second quarter of the year, bringing the total increase in spending, year-on-year, up to $2 billion.

Canalys describes the results as a “surge”, attributing it to the return of various projects that were postponed during the Covid-19 pandemic and lockdown. Most of the growth apparently came from the hospitality and transportation sectors that were hit particularly bad by the lockdown.

The company concluded that China now has a “renewed focus on digital transformation” as it looks to rapidly recover from the effects of the coronavirus. As a result, there is rising demand for cloud infrastructure.

Chinese businesses are looking to use cloud for both remote learning and remote working, but also for gaming, streaming and e-commerce, Canalys chief analyst Matthew Ball said.

"This, combined with the digitalization of processes and operations within enterprises and government organizations, will maintain demand," he added. The three biggest cloud providers in China are Alibaba (40 percent market share), Huawei (16 percent) and Tencent (15 percent).

Despite impressive growth, Chinese cloud providers are still a long way from being any threat to the world’s biggest players. For example, Microsoft’s Azure brought in more ($6.9bn) than all China’s clouds combined ($5bn).

Sead Fadilpašić

Sead is a freelance journalist with more than 15 years of experience in writing various types of content, from blogs, whitepapers, and reviews to ebooks, and many more, across sites including Al Jazeera Balkans, TechRadar Pro, IT Pro Portal, and CryptoNews.