Hong Kong is often known as the “Gateway to China” and where East meets West. This is in large part due to the colonization by the British starting back in 1841. Hong Kong was occupied by Japan during the Pacific War, after which the British resumed control until 1997 when China was given sovereignty. At that point, Hong Kong was already an economic power house, especially when it comes to international businesses who want to do business in China. Moreover, although Hong Kong is part of Communist China, it has a different political system. This “one country, two systems” is what makes Hong Kong the economic hub that it is today. It is also the reason telecommunications in Hong Kong is especially complex. Here are a few things you should know when looking into Hong Kong colocation.
Chris Palermo, GCN Founder/CEO touched on a number of these Hong Kong colocation issues in an earlier post. I would like to elaborate on the data connectivity.
1. Data Traffic Patterns:
In Hong Kong it becomes important to know where your internet traffic will be sent and received from. Many of the pricing structures are based on the percentage of HK Domestic, International, and China proper traffic because of tariffs.
Is international latency a concern? If you need a low latency data connection into Beijing, for example, it may actually make more sense to colocate in Tokyo where they have built many direct routes into China.
There are not many Hong Kong direct routes into China. the ones that are in place come at a price because local loops are controlled by state run telecom companies like China Telecom, China Unicom, and China Mobile, with a few exceptions. If the latency you are concerned about is to Singapore or Tokyo, you may want to look at colocating in the Pacnet Data Landing station in TKO. If latency is an issue, make sure you do your homework, and get your RTD latency added to the Service Level Agreement. You may also want to research the local Internet Exchanges in Hong Kong, HKIX and IBX. Tt may be more beneficial to simply cross connect.
Even within Hong Kong you should keep location in mind, much as you would if you were looking at data centers in New York City. The location you should look hard at is the TKO area. The government has incentivized this area for development, specifically for tech-centric companies. This means the majority of new data centers that are being built will be in this area of the city and will become the new telecom hub. This is especially true for the Hong Kong colocation industry. Furthermore, this will accelerate with the building of the new Hong Kong Exchange location in TKO. Some of the companies who have already taken advantage of this TKO incentive and started building are Pacnet, AsiaTone, Telstra, Telehouse, and PCCW. The proximity to the Data Landing Station makes this area a great choice for companies who need international connectivity.
To state the obvious, Hong Kong is not the United States. If your only telecommunication buying experience is based on the U.S. or E.U. market you may experience some sticker shock. So prepare your heart and your budget accordingly. There are many benefits to Hong Kong Colocation that makes this a worthwhile location for your data center needs.
We recommend you speak with a consultant to weigh the pros and cons of doing business in Hong Kong to make sure it is the right decision to reach your business goals.