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Contents
- China's data centers: from boom to centralized networking
- VPS, VDS and hosting in China: stability and opportunity
- Cloud markets: scalability and leaders
- Bottom line
China's data centers: from boom to centralized networking
China has experienced a massive data center construction boom under the "Eastern Data, Western Computing" initiative. By 2025, the infrastructure has expanded significantly, but many centers are operating at 20-30% capacity - a challenge to cost efficiency. In response, the government is developing a national cloud network to redistribute excess computing resources and increase utilization; the plan is to standardize connectivity by 2028.
VPS, VDS and hosting in China: stability and opportunity
VPS and VDS are growing in popularity in China as ways to access isolated resources without large hardware infrastructure. This is especially important for small businesses and startups that require reliability and scalability. The growing demand for such solutions is driving the market to grow faster in the Asia-Pacific region, including China.
Cloud markets: scalability and leaders
Overall investment in China's cloud infrastructure continues to grow, with Canalys forecasting the market to grow by around 15% in 2025. Among providers in the first quarter of 2025, Alibaba Cloud (33 %), Huawei Cloud (18 %) and Tencent Cloud (10 %) lead the way. This indicates that cloud solutions are highly competitive and developed domestically.
Bottom line
China's IT infrastructure is a combination of powerful data centers, growing cloud services, and flexible hosting solutions. However, the growth has been accompanied by overcapacity and the need for optimization at the government level. Nevertheless, cloud development, investment in AI-centric infrastructure and demand for VPS/VDS make China one of the most dynamic IT markets today.
Frequently asked questions
Large data centers are often built in regions with cold climates (e.g., Inner Mongolia) to reduce cooling costs. In addition, remote western regions allow the use of cheap electricity from renewable sources.
Direct ownership of a data center or cloud infrastructure by a foreign company in China is restricted by law - part of a policy to control critical data and cybersecurity.