Google has been working hard at its plans to get back into China. Per a report by Bloomberg, the tech giant is looking to cater to the world’s second-largest economy via its cloud service.
Google is currently in talks with other tech companies like Tencent Holdings, Inspur Group, and more as a way to offer its services to the country. These industry leaders have chosen to remain silent about the details, however.
Since beginning these discussions in January 2018, Google has narrowed its potential partner list down to just three companies. Due to trade tensions between the U.S. and China, though, these plans could soon go up in smoke.
What Google Wants
In other parts of the world, Google rents out its internet-based services, such as Google Drive and Google Docs, to businesses to assist them with productivity. This has all come to be known as G Suite, a one-stop-shop for all of the company’s services. Now Google wants to do the same in China, a place in the world that has proven itself to be the hardest to tap into.
China requires digital information to be stored in the country and Google has no data centers in the mainland, which is its biggest current hurdle in making its services available to the Chinese market.
After Google Cloud chief Diane Greene said that she wants the service to be a “global cloud” – albeit avoiding any China-specific talks – earlier this year, a job posting has appeared on the company’s website for a business manager that is based in Shanghai. The job listing calls for “experience in, and knowledge of, the Chinese market.”
A tie-up with large Chinese tech firms, like Tencent and Inspur, a major cloud and server provider, would also give Google powerful allies as it attempts a broader return to mainland China, where it pulled its search engine in 2010 over censorship concerns.
Google’s Rebuild in China
Since it began building foundation in China once again, Google has only begun working at a rapid pace fairly recently. It’s building a cloud data center region in Hong Kong this year and opened an artificial intelligence research center in Beijing in January. Along with other parts of the Alphabet Inc. family, it has begun investing more in Chinese companies. Plans for a censored search app in China surfaced earlier this week, sparking a furious debate about whether Google is putting profit over its mission to “organize the world’s information and make it universally available.”
Whichever company Google decides to partner with (or vice versa), it will come with some bumpy roads ahead. Many analysts have leaned more toward an agreement with Tencent as time goes one. If it partners with Tencent, Google will have a stronger Chinese ally, but will also find itself competing directly with Alibaba Group Holding Inc., which runs its own cloud-based service in the country.
In January, Google struck a patent-sharing deal with Tencent. The agreement came with an understanding that the two companies would team up on developing future technologies.
Tencent operates its own cloud service and is building an ecosystem of partners that includes Cisco Systems Inc., Nvidia Corp. and Deloitte. Google could host services, such as Gmail, Drive and Docs, on Tencent’s data centers, and the Chinese company may suggest existing cloud customers try Google offerings.
Google has also made quite a few strides in AI, which could make it more marketable in China. Tensorflow, a coding library for AI applications created by Google, is growing in popularity with researchers and software developers in China, which means striking a deal with the tech giant may be a good long-term move for whoever takes the bait.