Amazon To Sell Part Of Cloud Computing Business for $301 Million

Jon Howard
November 15, 2017

"In order to comply with Chinese law, AWS sold certain physical infrastructure assets to Sinnet", a spokesman for the Amazon.com cloud-services unit said on November 14, adding AWS would still own the intellectual property for its services worldwide.

In a TechCrunch article it was explained that Chinese law does not allow certain technologies to be owned by non-Chinese companies, so a transaction was required to continue the partnership between the companies in China.

Amazon Web Services is selling part of its public data cloud business in China to its local partner Beijing Sinnet Technology, according to a stock market filing by Beijing Sinnet.

Amazon is committed to establish in China, and is looking forward for significant business opportunities and growth potential for the next few years.

"AWS continues to own the intellectual property for AWS Services worldwide".

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Chinese regulators are tightening rules on foreign data and cloud services, implementing new surveillance measures and increasing scrutiny of cross-border data transfers. Sinnet urged its customers to avoid using virtual private networks (VPNs), which outsmart China's Great Firewall.

However, like its peers, Amazon has found it hard making headway in China, which is dominated by local tech giants Alibaba and Tencent Holdings Ltd. In China, regulations require Amazon to operate via a local partner before offering the services to customers. Some U.S. -based trade groups say that China has repeatedly lent deaf ears to the requests by U.S. firms on giving access to Chinese markets just like the Chinese firms get in the U.S. However, the Trump administration has hardly done anything to address the issue.

China favors domestic firms over foreign ones with paternalistic policies.

Sinnet owns eight data centres with more than 40,000 racks, according to its listing on AWS's partner directory.

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