By Sanjay Mirchandani, Senior Vice President and General Manager, Asia Pacific and Japan
Today marked a milestone development in VMware’s growth story in Greater China.
We have signed a Memorandum of Understanding (MoU) with China Telecom Corporation, Cloud Computing Branch, to build a world-class hybrid cloud service that will start benefiting Chinese customers next year.
This move represents an important strategic hybrid cloud partnership in China, providing Infrastructure-as-a-Service initially, with the potential to deliver future solutions that include Disaster Recovery-as-a-Service and Desktop-as-a-Service.
Based on VMware software, these solutions will be operated by China Telecom under the brand name “CT E-surfing Hybrid Cloud Services (Powered by China Telecom and VMware)”.
This news broke in one of the world’s fastest growing cloud markets, which adds significant weight to VMware’s vision of hybrid cloud as the future of IT.
Our vCloud software enables seamless extension of a private on-premise cloud to the public cloud in a way that’s compatible with existing IT assets. The result is that IT departments can manage a “best of both worlds” cloud environment in a totally unified manner, using a platform they already know and trust. This process unfolds as part of a natural transformation on the journey to our vision of IT-as-a-Service.
VMware has been pursuing a strategy of partnering with key Chinese technology, distribution and service provider partners to produce Chinese solutions for Chinese organizations. In that regard, China Telecom is the nation’s biggest cloud service provider. It operates an extensive telecommunications network and serves the largest Internet user base in China.
When the new hybrid cloud service is up and running, China Telecom’s sales force will target large to medium-sized enterprises and government departments. These will typically involve the financial, energy, transportation, insurance, healthcare and education sectors.
Cloud market development is part of the Chinese government’s 12th Five-Year Plan, so we are particularly pleased to be playing a role in that – ultimately helping Chinese organizations to benefit from greater agility and efficiency.
Chinese enterprises seizing the opportunity to make their businesses more competitive will give rise to significant demand. In fact, IDC forecasts that the total public cloud market in China will grow at a CAGR of 25% - from $1.464 billion this year to $2.890 billion in 2017.
Today’s news is the latest chapter in VMware’s rapid expansion story in Greater China. This part of our Asia Pacific & Japan business has grown by some 20% over the last two years. Our first mainland China office opened in 2005, since when we have established a presence in around 30 cities.
This blog post contains forward-looking statements including, among other things, statements regarding VMware and its affiliates plans for further expansion of its vCloud Hybrid Service offerings, the general availability of the vCloud Hybrid Service in China, the benefits to customers of vCloud Hybrid Service, and the growth of China’s public cloud market. These forward-looking statements are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to (i) adverse changes in general economic or market conditions; (ii) delays or reductions in information technology spending; (iii) competitive factors, including but not limited to pricing pressures, industry consolidation, entry of new competitors into the cloud computing market, and new product and marketing initiatives by our competitors; (iv) our customers’ ability to develop, and to transition to, new products and computing strategies such as cloud computing; (v) the uncertainty of customer acceptance of emerging technology; (vi) rapid technological and market changes in virtualization software and platforms for cloud computing; (vii) changes to product development timelines; (viii) VMware’s ability to protect its proprietary technology; and (ix) VMware’s ability to attract and retain highly qualified employees. These forward looking statements are based on current expectations and are subject to uncertainties and changes in condition, significance, value and effect as well as other risks detailed in documents filed with the Securities and Exchange Commission, including our most recent reports on Form 10-K and Form 10-Q and current reports on Form 8-K that we may file from time to time, which could cause actual results to vary from expectations. VMware assumes no obligation to, and does not currently intend to, update any such forward-looking statements after the date of this post.