Cloud Computing, Internet Datacenters and Big Data Business Intelligence from China

Hong Kong Is China Unicom’s Next Major Data Center Expansion

China Unicom held a foundation stone laying ceremony for its Hong Kong data center, in which the company will invest CNY3 billion.

The company will invest CNY3 billion to build a communications hub building in Hong Kong's Tseung Kwan O. This new building will be used as data center to enhance China Unicom's network services and it is expected to be completed in the first half of 2016.

Lu Yimin, general manager of China Unicom, said that this new center will have an international network platform, cloud computing service platform, and Internet data center, which will help improve the company's communications products development abilities outside of mainland China.

However, China Unicom still faces two major problems to build such a large data center in Hong Kong: one is a financial problem; and the other is market strategy problem. At the end of 2013, Google announced its decision to give up its data center plan in Hong Kong due to high costs. In the past few years, Internet-focused investments like Hong Kong's Cyberport have proven failures too as local Hong Kong citizens fight against expanded Internet growth in the region. But recently both Alibaba's Aliyun and Tencent Cloud have extended their reach to Hong Kong via data center investments.

Commenting on the potential problems, Lu said Asia will have increased demands for global Internet data centers and they believe the Asia Pacific region will become the fastest growth market of global cloud storage. The estimated average annual compound growth rate from 2009 to 2018 is about 29%.

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