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A new report by consulting firm BroadGroup details how Chongqing in south west China has devised a plan over the past three years, to implement a cloud datacenter strategy that could present China with a radically different business model and one in which foreign investors could take part for the first time.

Chongqing is now poised to take advantage of a window of opportunity in the coming 2-3 years to realize its ambitions of a city-wide economic transformation, with an offshore model and in the next 5-7 years to attain the level of “an Amsterdam” for the movement of digital goods and services in and around China and Asia.

Awarded the trial status of a cloud SAR is unique, and the first ever in China. With incentives for overseas investors the new plan to an extent allays concerns over the legality of licenses and data protection. Ultimately the success of the trial depends upon the completion of a unique direct circuit connection between Chongqing and the international telecom gateway in Shenzhen, the outcome of which should be known by the end of 2013.

This new report evaluates the extensive range of advantages, not least due to its status as a municipality, one of only 4 cities in this category. This means that Chongqing is accorded a very high priority by the central government over other localities and is able to secure more policy support and financial subsidies than other locations.

The report describes how the city offers business benefits for overseas investors across the issues common to all datacentre projects even though it is managed within an excessively bureaucratic context. Chongqing wants investors to experience a fast-track process through the minefields of licensing, land, construction, power supply and bandwidth issues.

The dedicated zone selected for datacenters and where construction has already taken place now has 9 companies already active in either building facilities or in the process of decision making and a number of further companies are currently assessing participation.

Pacnet has already built the first phase of its facility which has a design capacity of 40k servers. Regarded as a very key project, it is forecast that the new Tier III datacenter infrastructure will attract even more MNCs to relocate to the city.

Finally the report also looks at the challenges for overseas investors of which the license and data privacy remain an issue for some verticals.

Undoubtedly Chongqing represents a completely new way in the business model for datacenter operations in China and although not for the faint hearted, and still not easy, the commercial opportunities that could unfold from the Cloud SAR offer significant potential in the world’s largest datacenter market.

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