Jinshan Software Gambling Cloud computing: Betting 1 billion dollar chips

Facing the wave of mobile internet, Jinshan Software decided to bet the majority of chips in the hands, to the rapid development of the Jin Shanyun business.

December 3 afternoon, Jinshan software, millet (rolling information) technology and Century Interconnection in the Beijing headquarters of the company held media Communications, the official declaration of Jinshan Software, millet technology jointly injected into the century nearly 230 million U.S. dollars.

Jinshan Software CEO Zhanghongjiang said, the stake in the century interconnection, is the company's force cloud service business important part of the future 3--5 year, Jinshan will be to the cloud business scale of more than 1 billion U.S. dollars of investment.

As the chairman of Jinshan Software and millet technology, Lei said, cloud service window has arrived, this is the future direction of development, Jinshan Software want to survive, need to be in the cloud business to invest vigorously.

Why do you watch cloud computing?

This August, Jinshan Software held a business summary meeting, summed up the company's past 3 years of performance, and discuss the company's business development plan for the next 3 years.

It was at that meeting, Kingsoft software decided to increase the investment in cloud services, and the amount of money invested in the scale of about 1 billion dollars. Then at the board meeting in October, Lei persuaded the Golden Hill Software Board to approve the investment plan.

And the reason to be willing to bet on cloud computing, the most important point is that Jinshan small rice company to see the data explosion brought about by the big opportunity.

Lei revealed that the millet server now stores 24.1 billion photos, add 90 million a day, video has 274 million paragraphs, add 2.1 million videos a day. The highest day will add 380TB of data.

By this time next year, Millet will produce 1PB of data every day, and each PB data maintenance cost of about 2.003 billion yuan per year. Lei says that as more devices are plugged into the network, storing the data in the cloud, the need for an entire industry infrastructure will grow higher.

In addition, many companies spend 5% to 10% of their revenues each year on servers, renting rooms and buying broadband, but in the future they can be replaced by the way they buy cloud computing, further demonstrating the broad prospects for cloud computing.

And it is to see this trend of industry development, Jinshan finally decided to take out 1 billion U.S. dollars investment Jin Shanyun, to promote its development into an independent cloud services company, not only for millet, Jinshan wps, such as Jinshan Department of Enterprise Services, can also serve other enterprises.

"I think it is very likely that cloud services will produce several tens of billions of dollars (market capitalisation) in the future," he said. We hope to create value for shareholders, to Jinshan a long-term sustainable development path. This is the core reason why we invest in cloud services. "Lei said.

Why Gamble?

Although the cloud computing market prospects are broad, but really want to take out Kingsoft software account more than 90% of the cash to Jin Shanyun, the voice of doubt also followed.

At the Golden Hill board Meeting held in October, there were members of the board who asked Lei, do you really want to invest 1 billion dollars? Lei's response is: without 1 billion dollars of preparation and determination, this battle will not win.

According to Lei's plan, Jin Shanyun can become the top five cloud computing service provider in the industry after investing huge sums of money and relying on the growth of the millet ecosystem.

"To be the first three, the top five manufacturers, not to be squeezed out by the Giants, this time is more ruthless." If you dare, you will have a chance to live, if you dare not, do not do cloud services. Lei said the market, like the video market, is even worse than the video, either playing or playing or having no middle choice.

For the 1 billion dollar investment Jin Shanyun, Jinshan internal call "All-in cloud Services" program. "All-in" is a casino tactic, and the result is usually: either you get a big payoff or you lose your chips and leave. Obviously, Jinshan hopes to get the previous result.

In fact, Lei and Jinshan executives are optimistic about future development expectations.

Lei said that the market can really invest 1 billion of dollars in the company is actually not much, we only dare to vote 1 billion dollars, five years later we certainly in the top five of the market.

Development strategy

In addition to providing cloud computing services for millet, Jin Shanyun launched a cloud computing service for game makers earlier this year, with more than 200 game makers operating on the Jinshan cloud.

In accordance with the cooperation agreement between Jinshan and Century interconnection, the next three years, Jin Shanyun at least 5,000 cabinets to lease century. Century interconnection development 15 years, the total number of cabinets have only 18,000 or so.

"Our plan should be bigger than this (5,000 cabinets). "Because the future incremental market is much bigger than this year's stock market," said Jin Shanyun CEO Zhanghongjiang. "Our Jin Shanyun has risen seven times-fold, eight times-fold in the past year, it is not a hundred percent, the future increment is much larger than today's stock." ”

As of the third quarter of this year, Jinshan software still does not disclose the revenue data of Jin Shanyun business independently. But the Golden Hill software announcement may show that the revenue of this part of the business is growing rapidly.

This Monday, Jinshan Software disclosed in the HKEx, 2012 Millet paid to Jinshan comprehensive service fee is only 820,000 yuan, 2013 grew to 7.7 million yuan, the 2014 is expected to reach 95 million yuan.

And in order to avoid the cost of too fast growth, millet in advance with Jinshan signed a framework agreement, agreed 2015 years to pay the upper limit of the comprehensive service fee of 500 million yuan, 2016 for 1.5 billion yuan. Most of this is cloud computing services.

To make a difference in the highly competitive cloud computing market, Jin Shanyun faces a host of formidable rivals, at least in China's cloud-computing market, where Jin Shanyun needs to compete with Aliyun, Microsoft and Amazon Giants.

Zhanghongjiang said he was not too concerned about the competitiveness of multinational companies, despite the many rivals. "When the Chinese market is mutating, the cycle of decision-making by multinational companies is certainly not as good as ours." For Jin Shanyun, it's more important to focus on the business. "he said.

Lei once relied on stripping non-core business, the implementation of subsidiaries, let Jinshan software transformation to the mobile Internet, the Kingsoft software's share price from HK $3 to 30 Hong Kong dollars. But with the increase in investment, Jinshan Software's profits in the last two quarters have been affected, and the share price has fallen to around HK $18.

"I want the most is a decade and 20 years of long-term value, I hope that after 20, Jinshan software can also be active in the market line." Lei said that in the mobile internet era, Kingsoft software must be fully offensive, increase the investment in cloud computing business.

(Responsible editor: Mengyishan)