Microsoft has revealed a series of new business-facing cloud services in China with the first suite dedicated to the health and life science industries. The new services will be based on Microsoft’s enterprise resource management platform Dynamics 365 and the data-driven business solutions arm Power Platform.
The move is hot on the heels of Huawei (the Chinese smart devices maker) who unveiled its AI cloud service that is designed to accelerate the research and development of pharmaceutical companies. It also claims to be part of the company’s efforts in a “further upgrade in commercial applications” in the region, which will see future collaborations with local enterprises in other industries including retail and consumer electronics as per Microsoft on 29 September.
Alongside the announcement, the company also published a white paper on how Microsoft’s commercial applications will facilitate businesses’ navigation in China under the country’s stricter regulations around safeguarding users’ personal data and privacy.
Microsoft itself has been hammered following China’s first Personal Information Protection Law (PIPL) that took effect last November. The company’s services in China saw an immediate scale back, including the retreat and readaptation of LinkedIn and the suspension of the auto-suggestion feature on its search engine Bing last year.
With a long history in China since its official entry in 1992, Microsoft’s engagement with the Chinese government over the past three decades has been viewed as “suspicious”, as described by Peter Navarro, White House trade adviser in an interview with CNN. Unlike Facebook, Twitter, and Google (who discontinued Google Translate in China on 3 October, the last service Google operated in the world’s second-largest economy), Microsoft’s assets including Bing, Outlook, and Office 365, continue to be allowed in China.
The Office suite is operated by 21Vianet, the largest carrier-neutral internet data centre services provider in China, and has been “designated to meet the needs for secure, reliable and scalable cloud services in China”. While Bing has also been filtering sensitive results to play by China’s online censorship rules.
The two business applications Dynamics 365 and Power Platforms arrived in China in 2019 and 2020 respectively, realising the integration of its services including Microsoft 365 and smart cloud computing platform Azure. The latter service now plays a core role in data localisation for companies operating in China in compliance with the new laws – the Data Security Law and the PIPL, resulting in Azure China cloud being a data residency for its business partners trading in the sovereign.
Meanwhile, the focus on business cloud services is also aligned with the government’s push for the development of “hard” or “core” technologies such as semiconductors, AI, and advanced enterprise software, as Paul Triolo, SVP for China & Technology Policy Lead at Albright Stonebridge Group told Dao Insights in an exclusive interview.
Such a shift has also been reflected in the latest list (Q3 2022) of China’s new tech unicorns, which saw 6 out of 18 shortlisted belonging to semiconductor manufacturing or similar, followed by those in biotech and relevant businesses (4), according to IT Juzi, a Chinese structured database, and business information service provider.