Amazon sells cloud unit to meet Chinese cybersecurity regulations

Jeremy Goldkorn

Reuters reports that Sinnet, Amazon’s China partner, will “buy the U.S. firm’s Amazon Web Services (AWS) public cloud computing unit in China for up to 2 billion yuan ($301.2 million).”

  • In reaction to some media coverage of the move, Amazon’s chief technology officer tweeted that reports that AWS “is exiting its China business are completely wrong,” and that the company “remains committed to provide its service in China.”
  • A spokesperson from AWS said that the company “sold certain physical infrastructure assets to Sinnet” in order to comply with Chinese law.
  • Cloud services must store all data on servers located in China — where the authorities have the right to access it — to meet the country’s tough cybersecurity regulations. Amazon needed to sell off its AWS unit to meet this requirement.
  • China Cyberspace Administration (CAC) and other regulators have sustained their tough approach over the past few years. American tech companies such as Apple and Amazon have had to remove VPN apps and media apps not registered in China, among many other concessions.

If you want to play in China’s tech world, you play by Beijing’s rules.

Jeremy Goldkorn worked in China for 20 years as an editor and entrepreneur. He is editor-in-chief of The China Project, and co-founder of the Sinica Podcast. Read more

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