Online storage service to boost Internet startups

Internet startups in China eager to achieve the success of Instagram are finding their dream closer, as China's version of the network storage provider Dropbox is set to give them cloud infrastructure support.

Kanbox, a leading cloud storage and sharing service provider in China, started its Open API (Application Programming Interface) earlier this year to benefit small-and medium-sized Internet enterprises in need of cloud storage. ' Kanbox provides cloud services for local APP developers in photo sharing, file browsing and sharing. Such startups are in need of large online storage services, yet usually lack funds to build relevant infrastructure themselves, said Huang Mingming, Chairman of Kanbox.

"Many startups have sharp business acumen, but it's not practical for them to invest heavily in cloud storage infrastructure. As they grow, the limited cloud storage capacity will hinder their development," Huang said.

With the open API platform, software developers can integrate their products and services into the Kanbox cloud platform, thus saving the trouble to build the cloud storage infrastructure themselves.

IT companies with limited infrastructure investments are turning to outsourcing storage in order to avoid high datacenter costs. Huang said in this way their investments can be focused on their core business.

Serving the same function as Dropbox, Kanbox provides millions of customers and businesses with the cloud service. It allows users to store documents, photos, and videos online across multiple locations and devices.

Facebook's acquisition of the photo sharing app Instagram for 1 billion U.S. dollars grabbed world-wide attention. Instagram, a company of only a dozen or so employees, serves over 30 million users.It has been running its infrastructure on the Amazon Web Services cloud computing platform.

"In this way it can focus on improving its user experience. But so far Chinese startups are not so lucky," said Huang Mingming, also the former CEO of Flashget, China's leading freeware download manager.

The IT veteran pointed out the lack of a mature cloud storage service like the Amazon Simple Storage Service (S3) has impeded the growth of Chinese Internet startups.

In 2008 when Huang Mingming decided to establish the Chinese version of Dropbox, he failed to find supporting cloud computing service.

Thus Huang's company had to invest over 200 million yuan (31.8 millon U.S. dollars) in building cloud storage infrastructure across the country. It took them three years to finally launch Kanbox. Now the company has several thousand servers across China.

Huang's audacious move obtained support of venture capital. Last October, the company raised 20 million U.S. dollars in Series B funding led by the global venture capital firm DCM.

"As we already had mature online storage infrastructure across the country, we decided to open part of our service to startup enterprises.

"In this way, they don't have to go through the difficulties as we had before," Huang said.

According to a report by Springboard Research in 2010, cloud storage services in China is estimated to grow from 6.05 million U.S. dollars in 2009 to 208.54 million U.S. dollars in 2014.

The Ministry of Industry and Information said earlier the number of mobile phone users in China increased by 32.57 million to 1.02 billion in the first quarter of this year. Today China is also home to over 500 million Internet users.

Huang said the increasing popularity of the internet and Smartphones will spawn a growing need for cloud storage.

"After taking photos with their mobile phones, people want to directly upload them to the web. Also there's a growing need for a simple, secure way to share people's most valuable documents. It's all about cloud storage," Huang said.

Now Baidu, China's largest search engine, Qihoo 360, an antivirus software company, and e-commerce giant Alibaba have also launched cloud storage services.