Jeff Bezos, tech entrepreneur and founder of Amazon.com, recently spoke about tapping into the $2-trillion cloud services opportunity in India by setting up data centres in the country.

However, Bezos will have to wait a while to enter the segment, as the existing regulations don’t allow non-telecom companies to lease optical fibre cables, required for transmitting data.

Unified access services At present, the unified access services licence (UASL) rules permit only Internet Service Providers or Unified Access Services licence-holders to lease dark fibre directly to lay optical fibre cables in the country.

To a query on the regulatory issues, an Amazon India spokesperson said: “We are continually evaluating opportunities, including setting up a data centre in India, to enhance services for our Indian customers. We don’t have much more to add at this point.”

Amazon Web Services Amazon’s Indian subsidiary, Amazon Internet Services Pvt Ltd, has written to the Ministry of Commerce and Industry stating that Amazon Web Services (AWS) wanted to bring in its “state-of-the-art” data centres into the Indian market. The company has also sought clarity from the Ministry of Communications and IT on whether a non-telecom licence-holder can lease dark fibre for building infrastructure required for data centres.

The issue was discussed on December 18 in the first meeting of the inter-ministerial committee to fast-track implementation of the US investments.

AWS, which started in 2006, provides computing and storage services to businesses.

For Amazon, this business is growing faster than its retail business and its turnover is pegged at $3.2 billion by a few research firms. Currently, AWS accounts for just 7 per cent of Amazon’s total turnover.

Amazon has 11 AWS data centres globally and India is an important market for the company, Bezos told a public forum during his visit to India in October this year.

The data centre – or “region” as Amazon calls them – would require further investments. The company has already committed $2 billion to expand its foothold in the growing online retail market in the country.

The AWS model focuses on achieving economies of scale via highly automated and industrialised processes, embedded with the company’s global network of data centres.

Competition in the market Microsoft Corporation has recently announced that it will open three data centres in the country. Google and IBM also have data centres in India.

Globally, Amazon faces competition in the cloud computing market from companies such as Google, Microsoft and Rackspace.

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