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Speech by Mr Victor Lam, JP, Acting Government Chief Information Officer at "Cloud Expo Asia"

Hon. Charles Mok, Andy, Michael, Stephen, Distinguished Guests, Ladies and Gentlemen,

Good morning. It is my great pleasure to join you at this “Cloud Expo Asia” which represents the largest cloud ecosystem in Asia. Today, I would like to share with you the Government’s initiatives in cloud computing and data centre development. They are two of the key drivers and technology pillars for a digital economy.

In this digital era, disruptive technologies like cloud computing, mobile technology and Internet of Things are the anchors of advancement, with Big Data linking these disruptive forces. Among them, cloud computing is the game-changer for business by offering greater scalability, utility-based pricing and ubiquity among applications, consumers and cloud service providers. The idea of creating scalable and flexible shared computing solutions via the Internet has been displacing the traditional IT models.

Public cloud services are growing fast. According to Gartner, the worldwide public cloud services market is projected to grow to US$204 billion in 2016, with the highest growth rate at 38.4% in cloud system infrastructure services, i.e. IaaS. With an upward trend of organisations pursuing a digital business strategy, the strong growth in public cloud services continues, reflecting a shift from legacy IT systems to cloud-based services.

Cloud computing is also growing rapidly in Asia. In the Cloud Readiness Index 2016, Hong Kong is ranked first in cloud readiness in the Asia Pacific. In fact, according to the Index, Hong Kong, Singapore, New Zealand and Australia are ranked above countries such as Germany, the United Kingdom and the United States, demonstrating that Asia Pacific economies are leading the world in terms of cloud readiness.

Leveraging these opportunities and advantages, the Government has pushed ahead with the further development of cloud computing in Hong Kong with an array of initiatives.

Here is an overview of our cloud initiatives, which include setting up infrastructure, promoting the adoption of cloud services within the Government and among the public, setting up expert groups on cloud computing services and standards and promoting cloud adoption in the private sector, especially among SMEs.

We have launched a cloud computing platform, namely Government Cloud Infrastructure or GovCloud, since December 2013. It facilitates more agile and cost-effective delivery of e-government services. Currently, there are 12 application systems being developed or hosted on GovCloud. Riding on the cloud platform, the Government will continue with the development of e-government services for shared use by departments.

We have also adopted a scalable cloud design to re-provision the E-Government Infrastructure Service platform, which offers centrally-managed services for G2C and G2B transactions. The new cloud-based platform was launched in March 2015 and currently hosts around 160 e-government services.

To enhance procurement efficiency and pave way for promoting the adoption of public cloud services, OGCIO has put in place a procurement arrangement and announced a list of Government Public Cloud Service providers. As at the end of April 2016, there are 47 service providers offering over 300 public cloud services.

In its daily operations, the Government collects and generates substantial amount of raw data (such as demographic, geographical, meteorological and municipal management data). All these are Public Sector Information (PSI). Riding on public cloud platforms, opening up government data will help boost transparency, spur innovation, foster entrepreneurship and bring convenience to citizens, thus benefiting the society as a whole.

PSI covers data such as real-time traffic and weather information, geo-reference public facility data, population census statistics, etc. Automatic, synchronised and real-time data in machine-readable format can be re-used and re-created into useful innovative products and services. By mixing and matching the datasets, innovators or entrepreneurs can create value through developing new applications which benefit businesses and the society alike.

In March 2015, we have revamped our PSI portal into the “Data.Gov.HK” portal. It has employed a new technical platform, CKAN, which is an open-source data portal platform. The new portal offers greater flexibility and features advanced functions to facilitate the re-use of data to create value. It has a collection of data providers from government bureaux and departments as well as organisations. To date, there are over 6 000 datasets in 18 categories, provided by 50 data providers. The portal also makes available data collected and managed by other public and private organisations, such as MTRC, CLP, HK Electric, Centaline Property Agency and Hong Kong Society for Rehabilitation, etc.

We will continue to strengthen the collaboration with government bureaux and departments in releasing PSI datasets in digital formats and with application programming interfaces (APIs) in a more holistic and proactive approach. The Government will also continue to encourage public bodies and commercial organisations to open up more datasets and APIs.

Big Data and data analytics will give businesses and the Government a window into valuable streams of information by providing insights and values from bringing together individual datasets. We will explore the further use of big data analytics within the Government to enhance operational efficiency for better delivery of public services. We will also define data standards to facilitate sharing and linkage of data sources for data analytics.

To promote the awareness and adoption of cloud computing among the general public and enterprises, especially SMEs, we have launched a one-stop information portal named “InfoCloud” to provide access to information and resources on cloud computing technologies, such as sample use cases, guidelines and best practices.

The Government has accorded priority in promoting the adoption and development of cloud computing services and standards. The Hong Kong/Guangdong Expert Committee on Cloud Computing Services and Standards was established in July 2012 to facilitate exchanges among cloud experts both within Hong Kong and with the Mainland. Collaboration forums and conferences on cloud computing have been held to bring together the industry leaders from both Hong Kong and the Mainland.

The cloud experts of the two places had jointly developed and published the Hong Kong/Guangdong Practice Guide for Procuring Cloud Services in December 2014. The Practice Guide aims to assist organisations, especially SMEs, in both Hong Kong and Guangdong to understand the benefits brought about by adopting cloud computing in business operations. We have submitted the Practice Guide to relevant Mainland authorities for inclusion into the national cloud computing standards. We will continue to work with our Guangdong counterparts on the formulation of standards in cloud computing and other ICT areas such as big data analytics and smart city.

To enhance awareness and encourage the adoption of cloud computing solutions by SMEs, we organised the SME Cloud Promotion Campaign comprising a series of activities including training programmes on cloud computing, cloud competitions and related promotional activities.

The campaign enables SMEs to better understand the benefits of using cloud computing and how to choose cloud computing services for enhancing operational efficiency and competitiveness.

About 40 free training courses for six industry sectors were held, benefiting over 3 800 SME practitioners. Promoting cloud computing to SMEs is part of our overall support and facilitation efforts to help the industry.

The fast-developing cloud computing technology also drives the development of data centres. Cloud service providers need data centres to house cloud services and cloud-based resources. Let us also look at some of the Government’s initiatives in data centre development in Hong Kong.

Data centres constitute an essential part of ICT infrastructure in the digital economy. The Government is committed to promoting the development of data centres in Hong Kong, especially the high-tier ones. They serve as the technology backbone for business operations such as banking, financial services and insurance sectors.

It is expected that industry demand for data centres will continue to rise in the next few years due to the increasing use of cloud computing and the implementation of other initiatives such as smart city development and big data applications.

Hong Kong has built up a solid reputation as being a prime location for setting up data centres. Located at the heart of Asia, Hong Kong is strategically a centre for trade and business. There are over 7 500 overseas and Mainland companies in Hong Kong. Over half of them also establish their regional headquarters and regional offices here, making Hong Kong their natural choice for setting up data centres in supporting their regional operations. According to the Data Centre Risk Index, Hong Kong has been ranked as the safest Asian city for data centres. We are also ranked by the International Data Corporation as the most suitable location in Asia Pacific for setting up data centres.

Together with a pro-business environment, robust telecommunications infrastructure, reliable power supply, free flow of information, low and simple taxation regime as well as the proximity and close ties with the Mainland, Hong Kong possesses superior competitive advantages and is an ideal place to set up data centres.

The Government adopts a multi-pronged approach in formulating facilitation initiatives for data centre development. On the provision of land supply, the Hong Kong Science and Technology Parks Corporation has, over the years, provided some 19 hectares of land in industrial estates for data centre development. The Tseung Kwan O Industrial Estate now houses a cluster of 11 high-tier data centres, which is the largest data centre cluster in the Asia Pacific region. We have also earmarked three sites in Tseung Kwan O outside the Industrial Estate, with each site of about one hectare for high-tier data centre development. The first site was sold through public tender in 2013. We are now working to make available the remaining two sites for data centre use.

We had launched two concessionary measures in 2012 to encourage the conversion of eligible industrial buildings for data centre use and development of high-tier data centres on industrial lots. As of March 2016, we have received a total of 31 applications, among which 29 are applications for conversion of industrial buildings, 14 of which have been approved, providing a total floor area of over 67 000 square meters for data centre use. Moreover, there are two applications for redevelopment on industrial lots, one of which has been approved. The concessionary measures were originally set to expire at the end of March 2016. In view of positive market response, the Government had arranged for the continued implementation of these measures. In addition, we will streamline the procedures for issuing waivers for changing the use of industrial buildings into data centre use. It aims to approve new applications within a much shorter time frame of around two weeks.

To render assistance to enterprises interested in setting up data centres in Hong Kong, we have set up the Data Centre Facilitation Unit in July 2011 to provide them with one-stop support services. Since its establishment, the Unit has handled over 430 enquiries from enterprises within and outside Hong Kong, and assisted three overseas and two local companies to establish high-tier data centres in Hong Kong. In addition, the Unit proactively works with different government departments on measures to address the unique operational requirements of data centres, such as reducing the goods vehicle parking requirements, converting vacant parking space into transformer rooms where necessary, etc.

To spearhead Hong Kong into the next stage of development in the digital era, the Government is going to commission a study in mid-2016 to map out a territory-wide blueprint for the long-term development of Hong Kong into a smart city.

The Smart City blueprint will include a holistic digital framework and relevant international and national standards, and converge forces to promote big data, review the legal framework, and drive public-private collaboration among different stakeholders in smart city development.

Cloud computing has earned a place as one of the core disruptors of the digital age. Its interaction with the fast-growing data analytics and Internet of Things suggests more disruptive opportunities for the transformation of the Government, businesses, data centres and smart city development. Sharing the latest trends and tapping into new opportunities is the top agenda of every industry expert and business executive. I wish the “Cloud Expo Asia” a huge success and all of you a fruitful and stimulating sharing. Thank you.

- ENDS -

Presentation by Mr Victor Lam, JP, Acting Government Chief Information Officer at "Cloud Expo Asia"