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Amazon Web Services denies reports of China exit

Amazon Web Services denies reports of China exit

"‎We're excited about the significant business we have in China and its growth potential over the next number of years".

AWS also has a separate hardware venture in China and is partnered with the Ningxia provincial government in the north-west part of the country though all of Amazon's public cloud services are managed exclusively by Sinnet.

But Amazon said that it is only selling "certain physical assets" and still owns the intellectual property for AWS worldwide.

Reuters today reported that Amazon is going to sell its AWS cloud services unit in China to its partner Sinnet Technology in a $300 million deal.

"Chinese law forbids non-Chinese companies from owning or operating certain technology for the provision of cloud services", the US firm said.

The transaction's goal is to fully comply with China's laws and regulations, while improving the security and service quality of Sinnet's operation of Amazon Web Services.

"This move is mostly around regulatory compliance", said Charlie Dai, Beijing-based analyst at Forrester Research.




In recent year, cloud services are becoming a crowded and major competitive domain in China.

On August Sinnet asked the customers to stop using virtual private networks (VPNs) that allow users to circumvent China's Great Firewall.

Whereas AWS is the public cloud leader globally, it has struggled to crack a Chinese market that has traditionally been served by its own tech firms.

A Cyber Security Law (CSL) came into effect back in June, requiring certain companies to hold data within China and to undergo on-site security laws.

Foreign firms in China have long complained about local restrictions that appeared to favour domestic players. Foreign firms have repeatedly complained about the biased regulations in China that favor the local companies.

Amazon shares acquired 50 cents to $1,129.67 mid-morning Tuesday.