China and India emerging as cloud computing powerhouses in Asia-Pacific: 451 Research.


Executive Summary

Having maintained its position as the world's second-largest economy (in terms of GDP) for the past seven years, China's economic success is indisputable. Therefore, its recent stumbles have gathered so much attention from country leaders, economists and global investors. Aside from assessing China's long-term economic viability, experts have begun to identify the next growth engine. Not surprisingly, all eyes turn to India as the country gathers pace in terms of economic development. As discussions over the state of global economic leaders continue, propelled by ICT developments in the two economies, they have led to a related subject that 451 Research is investigating: the growth prospects of cloud computing in China and India as local companies are serious about retrofitting or modernizing their IT infrastructures to meet changing business requirements.

The cloud computing market remains largely in its early growth phase in China and India, but our Market Monitor predicts strong growth momentum through 2020, with a CAGR of 27% and 24% in China and India, respectively. Anticipating this growth, local incumbents, systems integrators (Sis), MSPs and cloud specialists are positioning themselves to ride the next wave of business transformation with new financial investment and talent development. Having already taken the lead in their home markets, technology giants and hyperscale cloud providers are playing an active role in supporting hybrid IT delivery in the two emerging economies both directly and remotely. Amazon Web Services (AWS) alone has already garnered tens of thousands of Indian customers for various cloud services prior to the establishment of its local operation in India and has recently added a new availability zone in Mumbai. Together with the five existing (Beijing, Seoul, Singapore, Sydney and Tokyo) AWS availability zones in Asia, the hyperscale cloud provider has a total of 35 availability zones around the globe.

Although global cloud providers such as AWS and Microsoft Azure are not foreign to local companies in China and India, they are hardly the only game in town. According to 451 Research's Market Monitor, there are nearly 200 cloud vendors (including global, regional and local providers) operating or doing business in India and China, providing a variety of cloud services in three service areas: laaS, PaaS and Isaas.

Growing market competition not only stimulates domestic demand, more importantly...

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