Tencent anchors international expansion on Hong Kong data-centre alliances

Mainland internet giant inks second deal this year for data centre use in HK, ensuring the infrastructure is in place for growth push

PUBLISHED : Wednesday, 11 December, 2013, 5:05am
UPDATED : Wednesday, 11 December, 2013, 5:05am

Tencent, the largest listed internet company in China, is stepping up its international expansion plans through a new infrastructure deployment in Hong Kong with global data-centre services provider Equinix.

It marks the second data centre-related deal that Shenzhen-based Tencent has set up in the city this year after the firm's collaboration with Hutchison Global Communications (HGC), the fixed-line business division of Hutchison Telecommunications Hong Kong, was announced in October.

As a major telecommunications hub in the Asia-Pacific, Hong Kong is typically chosen by large internet companies as a base from which to establish worldwide network connections.

Tencent has contracted the respective data centres of HGC and US-based Equinix to serve as "co-location" facilities, where the internet giant has deployed and manages its own server computers, storage systems and other equipment. The financial terms of these deals were not provided.

A data centre is a secure, temperature-controlled facility built and equipped to house large-capacity servers and enterprise data-storage systems, with multiple power sources and high-bandwidth links to the internet.

With the international demand for Tencent’s services, it is critical that the company has the … connectivity

"With the international demand for Tencent's services, it is critical that the company has the necessary connectivity options and infrastructure to support its growth around the world," Samuel Lee, the president of Equinix Asia-Pacific, said yesterday.

Tencent's international expansion efforts have been led by its popular social mobile communications platform WeChat, known as Weixin on the mainland. This application has become a commercial enterprise after Tencent made it a platform for new mobile games.

Ricky Lai, a research analyst at Guotai Junan International, estimates WeChat to have about 300 million users on the mainland and more than 100 million overseas.

Jonathan Chou, the vice-president for corporate development at Equinix Asia-Pacific, pointed out that the company was "exploring opportunities" to assist Tencent in future expansion plans covering additional markets globally. "We have a global presence that allows us to offer them a single contract to help them deploy in multiple countries," Chou said.

Equinix, which operates data centres in 31 markets around the world, serves more than 4,400 corporate customers. Its major global accounts include Microsoft, Facebook, Yahoo and Amazon Web Services.

The other mainland internet companies that Equinix currently serves are ChinaCache International, a provider of internet content and application delivery services, and ChinaNetCenter, an internet data centre services provider.