The company that operates Microsoft’s Azure cloud computing business in China is planning a huge increase in capacity heading into next year, CEO Satya Nadella announced Wednesday at an event in China.
21Vianet, which is the legal entity that operates Azure in China, will be spending a fair amount of money on new infrastructure after the announcement. Demand for cloud computing in China is expected to soar over the next few years, outpacing the already strong growth cloud vendors are seeing around the world, and Azure has 80,000 customers for its services at the moment, it said in a blog post.
Operating a cloud business in China is a little trickier. Foreign companies that want to set up cloud operations in China are required to team up with a locally licensed vendor — 21Vianet, in Microsoft’s case — in order to be allowed to do business in the country.
As a dust-up earlier this year involving Amazon Web Services’ local partner showed, that can be a little tricky in practice when those operators are forced to comply with Chinese regulations that wouldn’t fly in the U.S. or Europe. It’s much easier for Chinese companies like Alibaba and China Telecom, and they enjoy the largest share of the cloud market in China as they eye expansion into the U.S.