Cloud computing: shaping new horizons as top IT minds meet in ETOWN

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With an impressive collection of some of the country’s best and most innovative young IT experts, Beijing ETOWN is creating China’s answer to Silicon Valley with a hub for the emerging cloud computing industry.

Ask any expert and they will tell you that the future of the IT industry isn’t in the stratosphere, the oceans or even on the information superhighway. It’s in the clouds.

Cloud computing – using a network of remote servers hosted on the internet rather than a local server or personal computer to store, manage and process data – is transforming the industry. Beijing ETOWN is at the forefront of that movement in China.

Cloud Valley, an umbrella organization for cloud computing start-ups, has flourished since being set up in 2010 by entrepreneur Edward Tian, a strategic partner of former Yahoo! CEO Jerry Yang and the man credited with bringing broadband internet to China in the 1990s.

Tian sees huge potential for cloud computing in China, where it can open the door to a world of IT in particular for the hundreds of millions of people who cannot afford expensive computer systems and only have access to basic smart phones and laptops.

His goal, he said in one interview, is to use the breakthrough of cloud computing technology to give every citizen in China access to computers and information. His slogan is: "The price of a book, the power of a supercomputer."

Big-money backing

It is this vision that has won the enthusiastic support of the government, which named information technology as one of the seven strategic emerging industries targeted for investment of hundreds of billions of dollars in its current Five Year Plan.

 Cloud Valley
At the heart of the IT sector of Beijing ETOWN, that dream is slowly beginning to take shape with the rise of more than 30 start-up companies operating under the Cloud Valley umbrella at its 7,000-square-metre campus.

Executive director Yang Li, a lean and energetic 44-year-old who would not look out of place in Silicon Valley, shares the sense of vision and limitless possibility for the adventure the companies are embarking upon.

"The world has changed," he says in the modern open-plan setting of the Cloud Valley offices. "It’s not unlike the situation 100 years ago when companies used power factories to serve themselves before there was a grid to serve everyone.

"Cloud computing is as important a development as the electricity grid. In the next 10 to 20 years, many companies in China – maybe more than 50% of them – will change their computing system to a cloud service."

Already, Cloud Valley is providing cloud computing services to two out of three of the country’s major telecom networks. It also has a symbiotic relationship with the Beijing ETOWN government, giving it a cloud computing service for its own administration.

Great minds

The cloud computing movement has created a community within a community in Beijing ETOWN of progressive young IT professionals who share and exchange ideas and set up businesses together. 

They are a new breed of entrepreneur with attitudes that are markedly different from those of previous generations in China. "Before, people seldom wanted to get together and form a start-up company But now, start-ups are quite popular," says Yang,

"We don’t think it’s a crazy thing any longer. In fact many people have this ambition. In Silicon Valley, 'crazy people’ are quite common. If a person fails, they start up another company. Now people in China are changing their way of thinking and becoming more like this.

"They want to do something themselves. They want to maybe be somebody one day. And government and venture capital are providing the funds to give them the opportunity to set up their start-up companies."

Having those start-up companies in one area – China’s equivalent to Silicon Valley where 'crazy people’ can bring their dreams to reality – is a vital ingredient in nurturing their spirit of innovation. "It is important that smart people work together so that more smart people want to join," says Yang. "Communication is important in this industry.

"These innovative guys work together and communicate together and their innovative culture spreads to other people. We had one company here whose employees went on to create four more new start-up companies.

"We all work together and come up with new ideas and find new ways to serve people and to set up systems. Then they get many new ideas and these people need investors – and someone comes along and says 'This is a good idea. I can finance you.’"

Degrees of excellence

The development of China’s cloud computing industry relies upon an abundant supply of computer graduates. "One reason we chose ETOWN is the advantage of many colleges and universities in Beijing which can offer us talented people," Yang says. "At the same time, we still recruit hi-tech people from America.

"Many of our CEOs come back from the US and Canada, from Silicon Valley. With this kind of technology, the US is still at the top globally, particularly in Silicon Valley. We want to work together with our partners to get experts to come from Silicon Valley to here."

Yang says his ambition is to continue to generate more innovation in Cloud Valley. "We want to at first follow Silicon Valley and then develop our own technology." It is a process that will take years, he concedes.

"The US is the dominant power in this field and we need a long time to catch up. Even countries in Western Europe like Germany and Britain are still a long way behind Silicon Valley at the moment.

"In the past, our best graduates from places like Peking University and Tsinghua University went to the US to study further. But in recent years, I have noticed that many of our best graduates choose to initiate their own start-up companies in China instead.

"Sometimes they work together with someone who has come back from the US. Many people now come back to China and join an internet company or launch their own start-up company."

The race is a long one and the gap between Silicon Valley in the US and China’s own version of Silicon Valley is undoubtedly narrowing, and as innovation continues to flourish, the sky – and the clouds – are the limit.