Foxconn of Taiwan and China's 21Vianet Partner on Cloud Biz

Foxconn Technology Co., Ltd., Taiwan's largest manufacturing conglomerate by revenue, has signed an agreement to form a joint venture with 21Vianet Group, Inc., China's largest provider of carrier-neutral Internet center services, to tap the global market for Internet data center and cloud infrastructure equipment.

According to China's media, the joint venture, Smart Time Technologies Ltd., will open a joint R&D center for Internet infrastructure equipment and engineering technologies by integrating mutual expertise in information-technology hardware and software.

The joint venture will offer data-center planning, design, set-up, financing, and management and maintenance, in addition to packaged and tailor-made products and technological support for the center in China and overseas.

Informed sources say the joint venture will initially operate data-center and Internet infrastructure equipment business in Tianjin, Shenzhen, and Guiyang in China before setting up operations in Singapore, Hong Kong and America, with the JV to run in Tianjin and Shenzhen each a mega data center with 30,000-50,000 servers and likely to begin operation in H1, 2015.

China's market for data centers reached an estimated RMB26.2 billion (US$4.3 billion) in 2013, almost six folds from five years ago.

Without having decided on the operational scale of the joint venture, the two firms will invest some US$25 million initially.

21Vianet Chairman Chen Sheng says the data center is the base for big-data host, storage, distribution, and future trade and will play increasingly important role over the next 10 to 20 years in China's  development, and that Hon Hai has been chosen as partner for its excellent manufacturing, designing and development of cloud servers, storage equipment, and Internet equipment.

Foxconn's vice president, H.F. Wu, says the cooperation is crucial for the group's transformation to a high value-added manufacturer from a pure contract manufacturer and for 21Vianet's plan to accelerate global presence in data center service.

Foxconn has been vigorously developing presence in the server market since beginning of this year by setting up a server joint venture with Hewlett-Packard Co. and supplying it in Taiwan with  servers, also projecting its server sales to rise 75% this year from 2012 to command 30% of the world market. (KL)