Telecom giant Samsung have announced that they will be building a data center at Chuncheon, 50km away from the North Korean border, to compete against cloud computing giants like AWS and Alibaba. With this move, Samsung seeks to reduce costs on cooling their servers by moving to a colder location and providing service to private cloud deployers.
According to Samsung, the cloud market in Asia Pacific region has evolved exponentially ever since enterprises began running their workloads in the cloud. They say that this change in consumer behaviour has put the onus on cloud computing providers to expand their services in a bid to compete against their rivals.
By setting up a data center near the North Korean border, Samsung believe that they will get a major advantage with respect to saving costs at the facility. They say that this advantage in terms of costs will positively affect their profitability and allow them to serve clients who prefer the private cloud.
Samsung say that they have built several data centers around the world to serve their mobile phone users, but they never built a facility dedicated to private cloud. Since they are targetting more than 80% of large enterprises using multi-cloud providers, Samsung say that taking this step, given its location, was risky but necessary.
David Linthicum, Chief Cloud Strategy Officer at Deloitte Consulting believes that the step taken by Samsung has its own risks but is strategic in nature given the maturity of the cloud market. He says that since Samsung are playing in a managed services market, differentiating themselves from other providers is crucial, and it is this data center that will probably help them stand out.
In closing, the mobile handset firm said that this move was well thought out since they witnessed the cellphone market dwindling with cloud storage services taking the front seat. It will be interesting to see how Samsung leverage this data center, following their server farm launch in Seoul, South Korea.