Want China Times, Staff Reporter 2014-06-02
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Alibaba founder Jack Ma attends a strategy session in Hangzhou, Zhejiang province, May 27. (Photo/CFP) |
Nearly a
hundred financial institutions in China have switched to Alibaba's cloud
services division Aliyun amid security concerns with American service
providers, reports our Chinese-language sister paper Commercial Times.
A "get
rid of IOE" wave is currently sweeping across China's financial sector,
with IOE being an acronym for traditional American technology and data storage
companies IBM, Oracle and EMC.
Recently, a
large number of Chinese banks have abandoned IBM's high-end servers, with the
trend also expanding to Oracle and EMC as China's state media also accused US
networking equipment company Cisco of cyper espionage. Meanwhile, Beijing has
also banned the Windows 8 operating system from all government computers.
China's
domestic cloud service providers have been the major beneficaries of the
movement, with Aliyun gaining several million users as well as nearly a hundred
financial institutions that have ditched IOE.
The switch
comes after the US Justice Department made the unprecedented move of charging
five officers from the People's Liberation Army with cyber espionage earlier
this month.
According
to the China Securities Journal, Chinese internet giant Alibaba once negotiated
with Oracle with plans of a partnership, but Oracle wanted several hundred
million yuan for three years of service. Based on its calculations, Alibaba
realized it would have to fork out one to 10 billion yuan (US$1.6
billion-US$160 million) in expenses if it continued to use traditional IOE equipment
and services, prompting the Hangzhou-based company to start developing its own
system.
Apart from
Alibaba, Shandong-based technology company Inspur is also reportedly preparing
to replace IBM's Chinese servers. Reports say Inspur's host systems are in
charge of key applications for institutions such as the Export-Import Bank of
China, China Development Bank, China Construction Bank, the Postal Savings
Bankof China, and the Bank of Dalian, putting increasing pressure on foreign
service providers such as IBM and Oracle.
Once
China's financial sector gets rid of IOE, the country's telecoms, energy and
other sectors could soon follow suit to create a wave of mass migrations from
foreign to domestic service providers, the report said.
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