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TikTok rival Kuaishou builds USD 1.4 billion data center in China

Tencent-backed video app sees demand from product-placement streams.

Chinese video sharing app Kuaishou will spend about RMB 10 billion (USD 1.41 billion) to build its largest data center, as the company looks to support a user base poised for continued growth in a post-coronavirus market.

The data center, to be located in Inner Mongolia, will house roughly 300,000 servers. The company will put the center online in stages starting at the end of 2021.

The complex will support the demand for data storage over the next few years, the company said.

The platform allows uploads of videos a few minutes in length. Kuaishou caters to over 300 million users daily, making it China’s second-largest short-form video app behind Douyin, the Chinese version of TikTok owned by ByteDance.

As shopping centers remained closed from lockdowns, Kuaishou gained traction amid a surge in popularity in China of “live commerce,” or selling products via live streaming.

The Chinese government highlighted its “new infrastructure” push during the National People’s Congress session last month. The initiative includes investments in data centers and communication base stations that aim to both revitalize the economy and modernize industry and society.

Chinese e-commerce leader Alibaba Group Holding said in April it would spend RMB 200 billion over three years in cloud computing. Online services provider Tencent Holdings, a Kuaishou shareholder, followed up in May with a five-year plan to invest RMB 500 billion in cloud and other net infrastructure.

This article first appeared on Nikkei Asian Review. It’s republished here as part of 36Kr’s ongoing partnership with Nikkei. 36Kr is KrASIA’s parent company.