China’s biggest start-ups ditch Oracle and IBM for home-made tech as US trade tensions swirl

Enterprise software maker PingCAP already has more than 300 Chinese customers signed up

Reading Time:5 minutes

Customers use PingCAP to manage databases and improve efficiency. Photo: Handout

Published: 11:13am, 25 Jun 2019Updated: 11:57am, 25 Jun 2019

For years, companies like Oracle and International Business Machines (IBM) invested heavily to build new markets in China for their industry-leading databases. Now, boosted in part by escalating US tensions, one Chinese upstart is stepping in, winning over tech giants, start-ups and financial institutions to its enterprise software.

Beijing-based PingCAP already counts more than 300 Chinese customers. Many, including food delivery giant Meituan, its bike-sharing service Mobike, video streaming site iQIYI and smartphone maker Xiaomi are migrating away from Oracle and IBM’s services toward PingCAP’s, encapsulating a nation’s resurgent desire to Buy China.

PingCAP’s ascendancy comes as the US cuts Huawei Technologies off from key technology, sending chills through the country’s largest entities while raising questions about the security of foreign-made products. That is a key concern as Chinese companies modernise systems in every industry from finance and manufacturing to health care by connecting them to the internet.

“A lot of firms that used to resort to Oracle or IBM thought replacing them was a distant milestone, they never thought it would happen tomorrow,” said Huang Dongxu, PingCAP’s co-founder and chief technology officer. “But now they are looking at plan B very seriously.” IBM, which gets over a fifth of its revenue from Asia, declined to comment. Oracle, which gets about 16 per cent, did not respond to requests for comment.

China has long tried to replace foreign with home-grown technology, particularly in sensitive hardware – it imports more semiconductors than oil. That imperative has birthed global names like Huawei and Oppo and even carried over into software in recent years, as Alibaba Group Holding (which owns the South China Morning Post) and Tencent Holdings expand into cloud services. That effort has gained urgency since Washington and Beijing began to square off over technology.