Summary:

Chasing a potentially huge market, Microsoft has inked a pact with the municipality of Shanghai and with ISP 21Vianet to offer Windows Azure services in China. The deal could be huge but also problematic, given problems Google and other U.S. companies have had in China.

Updated: Microsoft is taking its Cloud OS show on the road to China, announcing a licensing pact with 21Vianet which will offer Windows Azure services from its local data centers. 21Vianet bills itself as the largest carrier-neutral Internet data center services provider in China. 

This could be a huge deal: Most researchers see China as a huge potential market for cloud services. As Doug Hauger, GM of Microsoft’s Server and Tools business, pointed out in his blog post announcing the deal, Forrester Research estimates that the public cloud market in China will soar to $3.8 billion in 2020 from $297 million last year. But doing business in China can also be highly problematic, given the issues Google and other U.S. tech companies have had there. The latest skuffle came when China shut off citizens’ access to the New York Times, following that paper’s expose last week on the personal finances of Chinese premier’s Wen Jiabao’s family.

Amazon Web Services, the world’s largest public cloud purveyor, has EC2 Asia Pacific coverage in Tokyo and Singapore and edge locations in Osaka, Hong Kong, Singapore and Sydney.

Update: A Microsoft spokeswoman emailed to say that Office 365 will also be available in China via two channels. For customers wanting a local source, the online productivity applications will also be available via 21Vianet. Others can source Office 365 through Microsoft data cetners in Singapore and Hong Kong. More here from the Office 365 blog.

According to that post:

“The Shanghai government also announced today that it will adopt both the Office 365 and Windows Azure services from 21Vianet once they are available.”

It was not clear when that will be.

 Feature photo courtesy of Flickr user brandnliu

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