The Asian-Pacific network operator Pacnet added more depth on the Chinese mainland today. Their equity joint venture in China, Pacnet Business Solutions, has managed to obtain an Internet Data Center (IDC) license from the Ministry of Industry and Information Technology in Chongqing.
As someone who spends a lot of time in the country, I can tell you that gaining this sort of license from the Chinese government is no small feat of bureaucratic magic. While the Chinese market is huge, the barriers to entry (official and unofficial) are legion and the unwritten rules and steps outnumber the written ones by an order of magnitude.
It’s no accident that foreign operators just land in Hong Kong and partner with the big domestic carriers to go further, despite the size of the theoretical market opportunity. Since refocusing its business after Carl Grivner took over as CEO, Pacnet has been trying to leverage its success in penetrating the mainland’s markets and an expanded managed services set into new growth opportunities internationally.
Chongqing is one of China’s main urban centers and by far the furthest inland of them, and the central government has been pouring resources into its support for data center and cloud infrastructure for some time now. Pacnet has been involved in that project for a couple years and recently finished building its own Tier III data center in the city with space for some 2,000 racks. The new IDC license enables them to expand the network and data services they can offer in the region.
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