Amazon, Microsoft pose threat to KT, Naver, NHN in Korea's public cloud market

來源: 開云體育手機app下載 時間: 2023-02-02 03:11:30

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By Park Jae-hyuk

Foreign tech giants are set to challenge the dominance of domestic companies in the market for cloud computing services for Korea's public sector, as the government decided recently to lower the barrier to entry, according to industry officials, Tuesday.

The Ministry of Science and ICT seeks to ease regulations on the security certification for cloud systems, so that companies can provide cloud computing services to the public sector, even if they do not physically separate their cloud servers for the public and private sectors. The science ministry will disclose more details about its plan later this year.

Under the current regulations, foreign cloud service providers have been virtually unable to provide their services to the public sector. The government and state-run institutions have therefore tasked domestic companies with projects to build cloud computing systems for them. The combined size of such projects is estimated to surpass 1 trillion won ($742 million).

Foreign firms, on the other hand, have collectively occupied over 90 percent of the market share in cloud computing services for the private sector.

Despite growing concerns among KT, Naver, NHN and other domestic cloud service providers over the possibility of foreign firms gaining dominance in the local market, Amazon Web Services (AWS), Microsoft and tech firms from the U.S. and China have welcomed the proposed easing of regulations, and are starting to look for experts in cloud computing services for the public sector.

"AWS has already begun to hire additional workers to reinforce its team in charge of cloud computing services for the public sector," a local cloud computing company official said. "U.S. firms can afford to offer excessively lower prices to win in competition with Korean companies."

Microsoft is also said to be considering hiring additional employees to provide cloud computing services to the public sector.

Some critics have pointed out that the government has been too hasty with its deregulatory measures, which could lead Korea's cloud computing industry to rely more on foreign companies.

Japan recently decided to use Japanese companies' services for government systems handling confidential information, although the country had once used the cloud services of U.S. firms for its public sector. The European Union has taken similar measures to protect data sovereignty.