Where Chinese or American Tech Is Used in Cloud Data Storage
Cloud computing has changed the status of network hardware like servers and data storage from a common asset of organizations or companies to a type of infrastructure. With this wide-reaching change come many implications, not least which enterprise owns and operates this infrastructure and which country they are from.
American and Chinese firms dominate the cloud computing and data center space, raising questions around data security and independence for third countries, many of which host data centers from American and Chinese companies and store their data and applications there. Major players include Amazon, Google and Microsoft from the United States as well as Huawei, Tencent and Alibaba from China.
Research from Vili Lehdonvirta, Boxi Wú and Zoe Hawkins at the University of Oxford and Finland’s Aalto University shows which countries are home to which kind of data centers. While several European nations including Italy and Poland as well as Israel and Gulf nations Qatar and Bahrain host exclusively American-owned cloud infrastructure, the picture is more mixed in Germany, the United Arab Emirates and the United Kingdom as well as in France and the Netherlands. The countries have between 14 percent and 40 percent Chinese data center infrastructure, measured by the share of so-called cloud availability zones, which are one or several connected data centers. The paper is scheduled to be published in the Review of International Political Economy.
The United States as well as Canada have small shares of Chinese cloud availability zones. Much higher shares can be observed in countries in developing Asia and in Latin America. The countries in question were rated as seeking the affordability that Chinese infrastructure offers, while some are also in favor of the Chinese model of the controlled internet, the report concludes. Worldwide, 70 percent of cloud computing infrastructure is American owned, while almost all of the remaining 30 percent is in Chinese hands.
While it is true that organizations can choose to host their data with a cloud provider all over the world, many use infrastructure that is close by or local. Government or corporate policy rules often stipulate that data centers within the same country or other type of jurisdiction are utilized. While this does have advantages in terms of legal recourse over data centers, questions remain regarding the ownership and country of origin of the technology used. While these concerns have in the past focused mainly on China, they could arise towards the United States more in the future as a consequence of the foreign policy actions of the current Trump administration.
The researchers of the report warn that due to these ownership structures, cloud infrastructure could theoretically be weaponized. A total disruption was deemed very unlikely, but extremely wide-ranging by the authors, as it would not only affect many workplaces and public authorities, but also, for example, banking applications, smart home devices and parcel delivery warehouses. The research concludes that the attachment to one or the other country of ownership has to do with trade intensity between the nations but also with strategic choices made by the third country’s government. However, owner nations have also been pushing their companies to expand overseas in the cloud sphere. While governments in Europe have made attempts towards cloud sovereignty - driven by suspicion of Chinese as well as American providers -, these initiative were rated as inefficient so far.
