Our products

more

Our services

consultation

Our service advantages
We provide an intelligent web control panel, through which users can manage their domain names and virtual machines at any time to achieve autonomous management.
We provide after-sales service through various channels, provide 7 * 24 continuous online technical support such as QQ, email and telephone, and respond quickly in 5 minutes.
We have 7 * 24 in-depth monitoring, audio alarm on duty, and the operation conditions are well known. Fault problems can be found and handled quickly.

  • Automatic opening
    Our domain name and virtual machine products are launched in real time after online payment, without waiting for manual review.
  • Elastic upgrade
    The virtual machine can be upgraded at any time according to user needs.
  • Price concessions
    Low price and high quality service ensure your satisfactory purchase.
  • Technical response and support
    Provide 7 * 24 technical support, telephone, QQ, e-mail support, and 2-minute quick response.
  • Troubleshooting
    Any fault problem will be solved in the shortest time, so you have no worries.

Latest news

more

Company News Announcement

Notice on Our Qingming Holiday in 2024
Notice on Spring Festival Holiday in 2024
Notice on Our New Year's Day Holiday in 2024
Self discipline Convention of the Website Platform
Notice on the Mid Autumn Festival and National Day holidays in 2023
Notice on the Dragon Boat Festival holiday in 2023
"East data and west calculation" must be managed as a whole

Hot industry news~

  • one
  • two
  • three
  • 2023 IDC industry development prospect analysis
    2023 IDC industry development prospect analysis

    With the continuous progress of information technology and the popularization of Internet applications, the development prospect of data center (IDC) industry is increasingly broad.

    1、 Demand growth drives IDC industry development

    First, the popularity of Internet applications and the rapid growth of data volume have promoted the development of IDC industry. With the increasing dependence of people on the Internet and the rapid development of cloud computing, big data, artificial intelligence and other emerging technologies, the requirements for data storage and processing capabilities are also increasing. At the same time, various industries have begun to transform to digital, and the demand for data centers is also growing. These factors have promoted the rapid development of IDC industry, and will continue to promote the sustainable development of IDC industry in the future.

    2、 Technological innovation promotes the upgrading of IDC industry

    Secondly, the continuous innovation of technology has also promoted the upgrading and development of IDC industry. With the continuous progress of technology, the application of various emerging technologies, such as artificial intelligence, blockchain, 5G, etc., has increasingly high requirements for the IDC industry. Data center enterprises need to constantly improve their technical capabilities and service quality to meet customer needs. At the same time, IDC enterprises also need to strengthen compliance, security and other aspects of management to ensure data security and meet customer compliance requirements. These technological innovations will promote the upgrading and development of IDC industry.

    3、 The industry is highly competitive, but has broad prospects



    Finally, the IDC industry is highly competitive, but the prospect is still broad. With the increasing market competition, IDC enterprises need to strengthen their core competitiveness, provide high-quality services and support, and improve customer satisfaction. At the same time, IDC enterprises also need to pay attention to enterprise brand construction and enhance market influence. Although the market competition is fierce, the IDC industry still has broad prospects for development, because with the increasing demand for data storage and processing, IDC enterprises have the opportunity to provide customers with more high-quality services.

    To sum up, the IDC industry faces many opportunities and challenges. Although the market competition is fierce, with the popularization of Internet applications and the rapid development of emerging technologies, the IDC industry still has broad prospects for development. In addition, the development of IDC industry is also affected by policies and regulations. For example, the Chinese government has issued a series of policies in recent years to encourage the construction of data centers and the development of cloud computing, which has brought huge opportunities to the IDC industry. In addition, with the continuous growth of personal data and enterprise data, data security and privacy protection have also become an important issue. This puts forward higher requirements and provides more opportunities for IDC industry technology and services.

    In general, the IDC industry is full of opportunities and challenges. With the acceleration of digital transformation and the continuous expansion of the cloud computing market, the IDC industry will usher in a broader development prospect. At the same time, the industry competition will also become more intense. In order to stand and develop in this industry, enterprises need to have strong technical strength and service ability, and constantly innovate and improve their competitiveness.

     2023/05/09

    View details
  • Internet Industry Outlook in 2023
    Internet Industry Outlook in 2023

    Internet industry Outlook for 2023: Ready for a new cycle of recovery

    Affected by multiple factors, the plate continued to be weak, showing a downward trend

    YTD（ December 2, 2022), the CSI Overseas China Internet Index (- 19%) outperformed the MSCI China Index (- 27%). From the peak on February 17, 2021 to now, the withdrawal rate of the Internet sector is still 69%, but it has been repaired recently. China's Internet sector will remain weak in 2022. We believe that the main factors include: the epidemic has repeatedly led to a slowdown in macro consumption, affecting corporate profits and residents' consumption capacity; Ÿ   Geopolitical conflicts, and China concept shares are disturbed by foreign capital sentiment; Changes in domestic industry regulatory environment;

     

    The emotional side is more affected by the policy and environment, and the overall amplitude of the plate is more intense. CSIC Overseas China Internet Net index throughout the year（ 240 trading days, up to December 2) There were five times that the closing price of a single day rose or fell by more than 10%, and there were 24 times that the closing price exceeded 5%. The influence of overall plate sentiment is far greater than the difference at the individual stock level. Throughout the year, the stock price of the plate roughly showed a "W" trend.

    The stock prices of Internet companies have generally declined this year, and the contraction of valuation is still the main reason. Pinduoduo benefits from income And the profit side improved significantly, and Ctrip benefited from the expectation of performance recovery after the optimization of epidemic prevention and control For the few Internet leaders who have made positive profits this year.

    Although the plate November saw a strong rebound, but the valuation is still in the low range. Most Internet companies' valuations are at a low level in recent years. Taking industry leaders as an example, Tencent and Alibaba currently have forward P/E ratios of 19.8x and 10.9x, with valuation percentiles at 6% and 5% since 2018, and valuation levels are still at the historical bottom.

    OTA outperformed the market significantly. Benefiting from the optimization of epidemic prevention and control and the higher certainty of the expected rebound of performance, the OTA sector recorded positive returns, while other sectors fell to varying degrees.

    Internet industry Overall trend outlook in 2023

    2023 Internet industry segment allocation strategy

    The segments we are relatively optimistic about are: 1) O2O: directly benefited from the adjustment of epidemic prevention policy, with high certainty of performance recovery and optimal allocation of sectors; 2) E-Commerce: consumer confidence has gradually recovered, the cost performance advantage is still prominent, and live broadcast e-commerce has seized market share; 3) Online video: continue to reduce costs and increase efficiency, short videos accelerate the layout of diversified businesses, and pay attention to the progress of video number commercialization; 4) Game: The release of version numbers tends to be normalized, and going to sea is a long-term drive; 5) SaaS: continue to focus on the domestic alternative concept, which is suitable for long-term layout.

    Core viewpoints

    In general, the expectation of industry fundamentals repair has gradually increased, or at the same time, it will drive the value based on performance improvement Revaluation. With the optimization of epidemic prevention and control policies and the recovery of macro-economy, Internet companies The performance in 2023 may gradually recover, but the recovery progress still depends on the epidemic prevention and control policy. We expect that the prospects for the second half of the year will be more clear. In particular, under the low base of the overall downturn of the industry in 2022, the income growth in 2023 may have a relatively good performance. At present, the industry risk is basically released, and the overall valuation is still low. It is recommended to arrange. According to the recovery order of e-commerce, advertising and games, the C end consumption recovery (pan e-commerce) or the B end advertising and enterprise services, the game business is relatively limited. Cost reduction and efficiency increase may continue, but the intensity may be weaker than that in 2022. The increase in revenue may offset the recovery of sales rate to some extent. In the short term, especially in the context of the rapid repair of the industry's overall valuation, the value stocks or the underlying stocks that exceed the price drop may rise more rapidly in a short period of time in the case of sudden favorable policies. From the perspective of medium and long term or the whole year, the company's fundamentals and performance growth are still the main driving force for the long-term growth of the company's share price. In addition, we believe that more Internet companies will choose dual listing in Hong Kong. If they can meet the relevant requirements and enter the Hong Kong Stock Connect, it will help to improve liquidity.

    How to view short-term performance catalyst?

    We believe that the biggest catalyst for Internet share prices is the adjustment and optimization of domestic epidemic prevention and control policies to And the macroeconomic recovery expected to improve. Especially entering Since December 2022, policies around the country have been continuously optimized, which has become the main driving force for a new round of growth in the sector. The O2O industry, especially the online tourism industry, is a direct beneficiary of the optimization of epidemic prevention policies. As production and life gradually return to normal, residents' consumption capacity is expected to gradually recover. However, the biggest risk factor in 2021 - industry regulation has gradually come to an end. The government has continuously released favorable policies in the first half of the year, giving positive signals to support the healthy development of the platform economy, and the biggest uncertainty in the industry is expected to be eliminated. In addition, for the risk of China Concept Shares, on August 26, 2022, the China Securities Regulatory Commission, the Ministry of Finance and the Public Company Accounting Oversight Board (PCAOB) signed an audit supervision cooperation agreement, which clearly agreed that the two parties should cooperate with relevant accounting firms to carry out regulatory inspection and investigation activities, forming a cooperation framework that conforms to the laws and regulatory requirements of both parties, It is an important step taken by the regulatory authorities of China and the United States in addressing the common concern of audit supervision cooperation.

    Resuscitation sequence

    Against the background of continuous optimization of epidemic prevention and control policies and improvement of macroeconomic recovery expectations The recovery progress may be different from that of the business model, according to the three business models of e-commerce, advertising and games Look, C end consumption recovery (pan e-commerce) or ahead of B end advertising and enterprise services, game business is relatively limited by this impact. E-commerce - E-commerce is greatly affected by the epidemic: on the one hand, offline logistics supply chain is interrupted due to the impact of the epidemic; On the other hand, residents' willingness to consume has decreased, especially in the optional consumer goods. We expect that after the alleviation of the epidemic, the logistics system will gradually return to normal, and the e-commerce track will take the lead in warming up. Advertising - The advertising industry is a barometer of the macro economy. Influenced by the macro environment, advertisers have significantly reduced their advertising budgets, and the advertising market is under pressure. Under the background of cost reduction and efficiency increase of Internet companies, advertising and marketing expenses are strictly controlled. According to QuestMobile's 2022 China Mobile Internet Autumn Report, the scale of China's Internet advertising market in the third quarter of 2022 was 166.33 billion yuan, with a year-on-year growth of 5.1%. Compared with that, the growth rate in the first quarter of 2022 was 3.9%, while that in the second quarter was 7.6% lower. With the recovery of C-end consumption intention, advertising may increase, but the recovery speed of advertising industry may be slower than e-commerce. Game - Compared with e-commerce and advertising, the game industry is relatively weak in its sensitivity to the macro-economy. As a cost-effective entertainment mode, the game industry has certain anti cyclical characteristics, and even benefits from the "housing economy" under the epidemic to some extent. The relatively independent cycle of the game depends more on the policy version, hardware technology upgrading, game play innovation and other factors.

    We expect In 2023, the cost reduction and efficiency increase of Internet companies may be weakened, and the business growth will be promoted again, and the revenue and profitability are expected to develop in a balanced way. Due to the impact of the macro environment, Internet companies will generally open the "winter" mode in 2022. Under the increasingly difficult environment of "open source", "throttling", that is, cost reduction and efficiency increase, will become the default choice of Internet companies. Internet enterprises strictly control costs, especially sales expenses used for user recruitment subsidies. In addition, they also gradually shrink their strategic layout outside the main business and move closer to the core business, so as to ensure the continuous operation of the company. With the improvement of the macro-economy, we expect that the cost reduction and efficiency increase of Internet companies may be weakened next year. The most difficult moment has passed, and the sales expenses may increase to a certain extent, re promoting the growth of business or revenue.

     

    3Q22 Performance of Major Internet Companies

    Among the leading Internet companies, Pinduoduo's performance was unparalleled, and its revenue and profit both exceeded the market forecast Period; The growth rate of Meituan's revenue is second to that of other companies, which still maintains a high growth rate, while the profit side has also improved significantly; old brand internet BAT is relatively weak due to macro impact.

    How to see the medium and long-term growth trend?

    In recent years, with the weakening of demographic dividend, the Internet, especially mobile Internet, has passed the high speed In the golden age of development, the growth rate of industry income tends to slow down. But we believe that China's Internet industry still exists The growth space is mainly based on the following aspects:

    1. The demographic dividend fades, but the per capita value has room for improvement

    The medium and long-term growth of the Internet industry will come from ARPU promotion. With the gradual peak of users, Internet enterprises will pay more attention to the in-depth mining of old users, improve the retention rate, consumption frequency or member prices, and thus promote the continuous growth of income. Taking e-commerce as an example, future growth will rely more on the increase of consumption frequency. On the one hand, with the "Generation Z" entering the society, the consumption capacity has gradually improved, which will further drive the increase of online shopping frequency; On the other hand, silver haired people are more and more accustomed to online shopping for daily necessities. From the perspective of goods, at present, the online penetration rate of physical goods in China is about 25%, and the proportion of online sales channels of categories such as fresh food is still low, less than 10%, so there is still much room for improvement.

     

    2. Go to sea to find new demographic dividend and broader market

    Although Chinese Internet companies have been mentioned for many years, 2022 can be regarded as a year of comprehensive going to sea, mainly because: on the one hand, many Chinese Internet sub industries have entered a relatively mature stage, with increasingly fierce competition, and overseas emerging markets have become the next Internet value depression; On the other hand, the tightening of industry supervision has also accelerated the process of Chinese Internet companies going to sea. In addition, the success of Tiktok, Mikayou's "God" and Shein in the fields of short video, games and cross-border e-commerce has also proved the feasibility of Chinese Internet companies going to sea. We believe that sea going will still be one of the main trends of China's Internet industry in the next few years to find new growth points: 1) the sea going track will be more diversified, gradually extending from the original tool based APP edge track to more mainstream tracks such as e-commerce, entertainment and even social networking; 2) The sea going area is more extensive. Although most Chinese Internet companies still prefer Southeast Asia as their first choice for sea going, there are also many companies making efforts in Latin America, the Middle East and even the more mature European and American markets, and the global competitiveness of Chinese Internet companies is gradually recognized. Meituan tested the water delivery business in Hong Kong, Pinduoduo launched cross-border e-commerce Temu in North America, and Chinese Internet giants are trying to explore the second growth curve in overseas markets.

    3. Technological upgrading and innovation to promote the continuous evolution of the industry

    AIGC (Artificial Intelligence Automatically Generates Content) may usher in explosive growth. With the continuous upgrading of AI technology, it will also continue to affect and change the way the Internet obtains information and produces content. AIGC is currently mainly used in the fields of text, image, video, audio and virtual human. After the AI painting boom, AI Q&A became popular again. Recently, ChatGPT, a new chat robot model released by OpenAI, has quickly become popular because of its high-quality content, which covers poetry writing, code checking and suggestions, and is no less popular than AlphaGo. On December 5, ChatGPT was launched less than a week ago and has reached millions of users. ChatGPT's core advantages lie in its natural language understanding ability, rich knowledge reserves and strong learning ability, which greatly improves the interactive experience. ChatGPT is essentially a chat robot software based on artificial intelligence technology. It can carry out intelligent chat conversations with users, help users solve problems in daily life, and provide users with rich information and services. ChatGPT architecture mainly includes three parts: natural language processing module, knowledge base module and learning module. The natural language processing module is the core part of ChatGPT, which is mainly responsible for understanding the user's speech expression, and inferring the user's needs according to the user's context and scenario, so as to generate appropriate response content. The knowledge base module is an auxiliary part of ChatGPT. It is mainly responsible for storing a large amount of knowledge information, including common sense problems in daily life, news information, entertainment information, etc., and can provide rich information services according to user needs. The learning module is an important part of ChatGPT. It is mainly responsible for continuously learning the user's language expression and communication habits, and building a dialogue model based on it, so as to constantly optimize its own dialogue ability. Compared with traditional search engines or Siri, on the one hand, ChatGPT can contact the context to achieve continuous and complete dialogue; On the other hand, ChatGPT's answers are more logical, comprehensive and professional. Of course, due to the relatively limited training samples, there is still much room for improvement in the accuracy and timeliness of knowledge in some specific areas of ChatGPT.

    In addition, Web 3.0 also represents the direction of the exploration of the new generation Internet. It is based on the concept of de trust, disintermediation and digital capitalization, with blockchain as the underlying key technology, and digital production and consumption as the main economic form. Web1.0 is "readable", Web2.0 is "readable+writable", while Web3.0 will be "readable+writable+owned", emphasizing "digital capitalization" and "decentralization". In particular, blockchain technology has greatly promoted the development of Web3.0. As an advanced data storage method, it can achieve transparent information sharing. Its decentralization and immutability solve the trust problem in interaction, help create a stable and transparent business environment, and improve economic operation efficiency. To be precise, Web3.0 is not an industry, but represents a model, which can be combined with various traditional industries to derive "Web3.0+", thus realizing commercial landing. Web3.0 is still in the exploratory stage, and its long-term value is still worth looking forward to.

    Internet industry Industry Segmentation Outlook in 2023

    O2O: High recovery certainty, optimal plate allocation

    2023 Outlook

    At present, offline economic activities are still affected by the epidemic in the short term, but with the optimization and adjustment of epidemic prevention policies, The recovery trend of offline activities is better. In 2023, O2O's performance growth is expected to rebound from a low base, with high recovery certainty, but the recovery progress still depends on epidemic prevention and control and consumption recovery: there is still room for improvement in catering takeout, and instant retail remains high growth; The pattern of community group buying is stable, and the profit and loss balance may be achieved in 2023; Online travel demand is strong, and recovery is expected to be more clear in the second half of next year.

    Review of 2022

    Meituan's share price performance is relatively weak, year to date（ December 5) fell 23% accumulatively, but the fundamentals remained stable; With the continuous optimization of epidemic prevention and control, the market expects that the online travel business will recover rapidly. Since the beginning of the year, the stock prices of Ctrip and Tongcheng Travel have risen to 31% and 17% respectively, which is one of the few sub sectors with outstanding performance in the Internet industry.

     

    Food and beverage delivery still has room for improvement, and non food and beverage delivery maintains a rapid growth

    1. There is still room for improvement in catering takeout

    According to our channel research data（ October 2022), from the perspective of merchants, the penetration rate of food and beverage delivery in high-end cities is about 55%, and that in low-end cities is about 35%. There is still much room for improvement in the future. On the one hand, it comes from the increase of merchant coverage: newly added snacks, snacks, desserts and drinks will basically choose online takeaway platforms; Secondly, the increase of chain rate will also promote the increase of takeout penetration. At present, the chain rate of catering in China is about 17%, which is lower than that in the United States, which is 60%+. On the other hand, it comes from the increase of consumption frequency: if we take out 2.1 times a month per capita in China, the proportion of takeout is only 2%. It is expected that afternoon tea, lunch and dinner will have a great room for improvement.

    2. Flash purchase business or maintain rapid growth

    Meituan flash purchase is positioned to reach supermarkets in an hour, and the main force in the future will still be convenient in supermarkets, accounting for the proportion of orders 40-45%. In addition, Meituan buys 20% medicine, 16-17% flower cake, and 10% chain stores and stores. Compared with community group buying, flash buying, an instant retail mode, will be more popular in first tier and second tier cities, with high unit price and high frequency, and it is dominated by young users, who pay more attention to service experience and timeliness. In terms of competition pattern, compared with JD, Meituan has a wide range of categories, with an average daily order volume of about 4.6 million to 4.7 million, but the customer price is relatively low, with flash purchase orders of about 70 yuan, more like non catering takeout. JD's order volume is less than that of Meituan, and the customer price is high, 180-190 yuan, which is more like e-commerce mode. JD's advantage in instant retail lies in its coverage of supermarkets. About 80% of the leading chain stores in China have cooperation with JD, and some users of JD are hoarding demand.

     

    The pattern of community group buying is stable, In 2023, the deficit may turn around

    Scale expansion is no longer the focus of community group buying industry, but more emphasis on cost reduction and efficiency increase. According to our channel From the perspective of company performance assessment, the original market share and unit volume have gradually changed to more Focus on cost control, performance rate and consumer experience. This is mainly because the community group purchase has been issued To a certain extent, in addition, under the current macro environment, enterprises can hardly bear large losses and will be profitable in the future Profit depends on optimizing procurement channels to improve gross profit. We expect that In 2023, the community group purchase business may turn losses. In addition, we expect the industry to grow by about 50% this year, slowing down from the geometric growth before. However, as a cost-effective channel, community group buying will still be favored by consumers, especially when the market sinks and the economy is depressed. We believe that it will continue to grow by 30%+in the next two to three years. In terms of competition, the pattern of Pinduoduo and Meituan might be relatively stable, with Pinduoduo slightly ahead and Meituan in a state of shrinking defense. The main entrance of community group buying is fresh food. Due to the huge market scale, it is not expected that the group buying will be dominated in the future. In addition, due to their slightly different focus areas, community e-commerce will not have too much direct competition.

    Tourism demand is strong, directly benefiting from the optimization of epidemic policy

    The optimization of epidemic policy will directly benefit online tourism, which may usher in a comprehensive recovery. Affected repeatedly by the epidemic, The tourism industry suffered another setback this year. On the whole, low tier cities are relatively less affected, while high tier cities Travel demand is relatively affected. Transport business is more affected than hotel accommodation business, mainly because For tourism, local travel and peripheral travel are still the main travel. Since the epidemic, tourism demand has been suppressed for a long time, With the continuous optimization and adjustment of recent epidemic prevention and control policies, online tourism may experience three years The "cold winter" ushers in a comprehensive recovery, and the restrictions on cross provincial and cross-border travel may be gradually lifted. Tourism demand is strong. In 2022, favorable policies were successively introduced: on June 28, the Comprehensive Team of the Joint Epidemic Prevention and Control Mechanism of the State Council published the Prevention and Control Plan for New Coronavirus Pneumonia (Ninth Edition), proposing to adjust the isolation and control time of secret contacts and entry personnel from "14 days of centralized isolation+7 days of home monitoring" to "7+3". On June 29, the Ministry of Industry and Information Technology announced the cancellation of the "star" mark on the communication travel card, which will also accelerate the release of domestic travel demand. The big data of the same trip shows that within half an hour of the cancellation of the "star" message, the search volume of the platform ticket increased by 180% compared with the same period the day before yesterday, and the search volume of the hotel increased by 220% compared with the same period the day before yesterday. On November 11, the "20" measures for epidemic optimization further emphasized precise prevention and control, adjusted "7+3" to "5+3", and canceled the circuit breaker mechanism for inbound flights. On December 1, it was reported that some regions in Guangzhou had recently released an announcement to lift the temporary control zone. After the news was released, a large number of tourists landed on the same journey travel platform to search for travel products departing from Guangzhou. As of 15:00 that afternoon, the search volume of outbound air tickets in Guangzhou had quadrupled compared with the same period the day before yesterday, and the number of air ticket orders had increased by 126% compared with the period the day before yesterday. The search volume of train tickets departing from Guangzhou rose by more than 300%.

    The industrial impact of byte beating layout of local life business

    On August 19, Diaoyin and Ezema announced their cooperation to expand local life business. However, according to our research, the effect is average at present. The business impact of Dithering Home is still limited, mainly due to the high industrial barriers of instant demand. Food and beverage takeout requires high performance requirements, and short videos are mostly based on interest. In the case of insufficient business coverage, it is not easy to meet the triple conditions that users can find takeout when they swipe videos, and businesses are still around. The performance of Dithering to Store business is relatively good, which may have a certain impact on the industry. Ditto focuses on low price routes, and seeks experts to bring goods, turning short videos into interesting e-commerce, while Meituan Reviews are more purposeful. The effect of nationwide chain stores and online celebrity stores on Tiaoyin is relatively good, turning local life services into local life e-commerce, which can sell group purchase coupons, and it is faster for businesses to return blood. However, this mode is very dependent on agents. At present, the general feedback of merchants is that although the traffic of dithering is large, the conversion rate is relatively low.

    E-commerce: consumer confidence has gradually recovered, and the cost performance advantage is still prominent

    2023 Outlook

    Although the overall consumption growth slowed down, online consumption still maintained a good growth, with the continuous epidemic prevention and control policies Optimization and improvement of macroeconomic recovery expectations are expected, and consumer confidence is also expected to recover; Live broadcast e-commerce or Maintain a strong growth momentum and continue to share the e-commerce market; The price advantage of e-commerce platform will be more prominent.

    Review of 2022

    Alibaba, as the leader of e-commerce industry, is under multiple pressures such as macro-economy, industry supervision and competition pattern, The stock price trend of the whole year was relatively weak, as of On December 2, the cumulative decline was 24%; JD's share price trend is similar to that of Alibaba, down 16%; Pinduoduo's share price in the first half of the year was in line with the trend of the industry, but in the second half of the year, it achieved a sharp rise in share price by virtue of two consecutive quarters of financial reports that exceeded market expectations, becoming the best performing company in the e-commerce industry and even in the head of the Internet.

     

    The proportion of online consumption further increased. According to the National Bureau of Statistics, From January to October 2022, the total retail sales of social consumer goods increased by 0.6% year on year, showing a relatively weak performance. However, the online retail sales of physical goods increased by 7.2%, recording a sustained growth trend since May, and the proportion of online economy further increased to 26.2%, a record high.

    Structural change under stock competition: China's retail e-commerce has gradually increased after nearly two decades of development As quantity enters the era of stock, we expect to achieve steady growth in the future. The core elements of e-commerce include: people Goods and market, and the essence of industry iteration is also the reconstruction around three elements: sinking user competition, near field The rise of e-commerce and channel diversification under decentralization are three major themes of China's e-commerce industry:

    from From the perspective of "people", in the short term, the market competition will sink, and medium - and long-term growth will rely more on the increase of consumption frequency. Although the dividend of the sinking market has weakened, it is still the main user increment;

    from From the perspective of "goods", the near field e-commerce has brought incremental growth to the industry, and community group buying and instant retail business has risen rapidly. In 2021, the online penetration rate of physical commodities in China will be about 25%. From the perspective of category breakdown, the "online" speed of fresh food is far behind other categories, less than 10%, due to its vulnerability. With the improvement of supply chain infrastructure, there is still much room for penetration to increase in the future;

    And from From the perspective of "market", decentralization promotes channel diversification and intensifies industry competition. Private domain e-commerce and live broadcast goods delivery grew rapidly, breaking the original competitive pattern of traditional e-commerce. The high growth of live video with goods, sharing the traditional e-commerce market, helped to shuffle the cards. However, the impact of live video with goods on specialty e-commerce is more obvious, becoming one of the channels for brand merchants to clear inventory; The change of the head anchor has greatly affected the game of the trading volume of goods on each platform.

    Live broadcast with goods continues to share the e-commerce market. In the past few years, China's live broadcast e-commerce industry has developed rapidly The scale has reached the trillion level, becoming one of the important marketing channels in the e-commerce industry. According to Ai Media data, In 2021, the size of China's live broadcast e-commerce market will be 1.2 trillion yuan, up 25% year on year. It is expected that the market size will exceed 2 trillion yuan in 2025.

     

    Structured consumption is downgraded, and the price performance ratio of goods is valued. The uncertainty and economy of consumers in the current external world When the growth rate slows down, they tend to purchase consumer goods that can make people happy for a short time but are not expensive. In order to deal with future uncertainty, people's consumption tends to be rational, showing structural consumption degradation Value for money. Pinduoduo is famous for its low price, and its income presents Accelerate the growth trend. We believe that the structural consumption degradation will continue in the future The price advantage is more prominent.

    Pan video: continue to reduce costs and increase efficiency, and short video accelerates the penetration of multiple services

    2023 Outlook

    Cost reduction and efficiency increase have achieved initial results, and profit margin is expected to continue to improve. The weak advertising market makes It is under pressure in the short term. We are still optimistic about the growth trend of the short video track in the user traffic side, and rely on the traffic Advantages accelerate the penetration into other businesses.

    Review of 2022

    In the second quarter of Fasthand, it realized profits after domestic business adjustment in advance, and the stock price performance was relatively good, year to date down fall 12%, better than the market. IQIYI has made profits for the third quarter in a row, but affected by the advertising market, the income side is under pressure, and the stock price has fallen by 31%; Bilibili is still in the midst of losses, and the stock price realization is relatively weak, with a cumulative decline of 58%.

     

    The traffic is still growing at a high speed. Although the overall Internet traffic dividend fades, short and medium video tracks are active The degree and flow rate still show a rapid growth trend, and the scale of fast hand and billbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbillbill Digit growth.

    The overall weakness of the advertising business is the biggest pressure on short videos. Advertising cashing is an important cashing party of video platform For one thing, due to the overall pressure of advertising business, the growth rate of short video advertising revenue will also slow down. but Due to its traffic advantage, we expect that with the overall recovery of the advertising business, the short video advertising revenue will recover High growth and continued to seize market share.

    The video number may become the largest variable in the industry. In July 2022, the video number will launch information stream advertising to accelerate the commercialization process. The activity of WeChat video accounts continued to increase. In the second quarter, the total user duration had exceeded 80% of the total duration of the circle of friends, and the total broadcast volume had increased by more than 200% year on year. With the social advantage of WeChat, we believe that the number of video number users is expected to rise from behind, but the user duration still needs to be improved in terms of content adequacy and algorithm. In addition, relying on the WeChat ecosystem, video accounts can also work with small programs and public accounts. Video accounts also contain a lot of cash space, which is expected to bring incremental growth to the industry.

    Game: The release of version number tends to be normalized, and going to sea is a long-term drive

    2023 Outlook

    The distribution of game version numbers has gradually become normalized, and next year may benefit from the recovery of positive growth from low base numbers; Due to the industry Against the wind, the importance of the game company's research and operation ability is more prominent. We maintain a bias towards the head game manufacturers OK.

     

    Review of 2022

    Tencent and NetEase share prices have similar performance, falling respectively 33% and 30%, the game version number is one of the main constraints, and the number of approved versions in the first 11 months is only 1 and 2 respectively.

    Affected by the shrinking version number and offline economic recovery, The revenue of the game industry is expected to decline in 2022. According to Gamma data, the actual sales revenue of China's game market in the first three quarters of 2022 was 207.5 billion yuan, down 5.7% year on year, mainly due to the sharp contraction of the game version number and offline economic recovery; The overseas revenue of China's self-developed games was 4.55 billion US dollars, down 0.5% year on year. The revenue of sea going games declined, mainly due to the recovery of economic activities after the epidemic, which reduced the consumption of users' games.

    The number of game version numbers is shrinking, and the distribution of version numbers is inclined to small and medium-sized manufacturers. since Since the release of the version was resumed in April 2022, a total of 384 games had been approved by the end of November, of which 5 had not been released for 5 months, and the number of releases has shrunk significantly again. The number of each batch of version numbers in recent months is about 70. According to this trend, the number of game version numbers in 2022 may be about 450, which may be 40% lower than the contraction of 46% in 2021. The distribution of game version numbers is more inclined to small and medium-sized manufacturers. As of the end of November, Tencent and NetEase had only one and two versions approved this year, and the number of other large manufacturers' versions was also mostly in the low and middle single digits. From the perspective of proportion, the proportion of small and medium-sized manufacturers obtaining version numbers has increased.

     

    Sailing to sea has become a must for game manufacturers. The reduction of the number of domestic games will affect the product release rhythm of game companies As a result, most game manufacturers focus on overseas markets Future focus. The game going to sea has basically become a must for game manufacturers. For example, Tencent and NetEase have said that they have not To vigorously develop overseas game business, aiming to increase the proportion of overseas game revenue to 50%, there is still much room for improvement.

    The margin of public opinion has improved, and the industry is expected to recover next year. With the strong supervision in recent years, The game industry has basically achieved standardized development, and the public opinion on the game industry has marginally improved Trend, start to pay attention to the positive value brought by the game industry, which we believe will help the game industry Long term healthy growth. Due to the low base effect this year, we expect that the revenue of the game industry will be able to It has rebounded. It is suggested to pay attention to head game manufacturers in the headwind of the industry. The distribution of game version numbers has been tightened, making game manufacturers Shrink the R&D production line, eliminate low-quality games, emphasize the refinement of games, and pay more attention to the R&D of game products Success rate. We believe that the importance of game manufacturers' R&D capability will More prominent; At the same time, the stock competition in the industry is intensifying, and strong operation capability is also the key to success; In addition, due to the uncertainty of game version number acquisition, the powerful existing game product matrix will provide For defensive purposes.

    SaaS: continue to focus on domestic alternatives, suitable for long-term layout

    2023 Outlook

    The uncertainty of the macro environment is still the biggest constraint that affects the demand of the industry in the short term. We are optimistic about the industry next year The demand gradually recovers, but The recovery progress of To B enterprise services may be slower than that of To C business; In the long run, in the context of digital transformation, the growth potential of the SaaS industry is still worth looking forward to. The current valuation is close to the bottom, suitable for long-term layout;

    Review of 2022

    because The overvalued attribute of the SaaS industry has suffered more severe valuation contraction in the downward period of the sector, with UFIDA Kingdee down about 35% and Kingsoft software down 21%.

     

    The valuation continues to repair, and the leading US stock market is still the valuation anchor. In the long run, in the context of digital transformation Next, The growth potential of the SaaS industry is still worth looking forward to, and the current valuation is still in the low range, suitable for long-term layout. There is still a certain gap between Chinese SaaS enterprises and American SaaS leaders, and there is huge room for growth in the future. This is mainly due to the environmental differences between the domestic and American ToB markets, which are at different stages of development. The domestic To B business, especially the SaaS track, is still in the early stage of market cultivation. In particular, there is still much room for improvement in the standardization of different customer processes. In addition to SaaS products, the corresponding value-added services are also particularly important. In terms of valuation, the valuation of China's SaaS companies will still be anchored by the leading US stocks. In the first half of this year, affected by the expectation of liquidity contraction and the decline of digital "dividends" brought by the epidemic, the SaaS sector of the US stock market experienced a sharp correction, with a decline of more than 50% from the peak, and relatively stabilized in the second half of this year.

     

    View details
  • IDC Internet Data Center Research Report in 2023
    IDC Internet Data Center Research Report in 2023

    Chapter I Industry Overview Internet Data Center（ Internet Data Center (IDC) is a large-scale data storage and processing facility used to store, process, manage, and distribute Internet related data and applications. IDC usually consists of a series of network devices, servers, storage devices, backup devices, security devices, refrigeration devices, power supply devices, etc. They are usually operated and managed by large Internet companies, telecom operators, cloud computing service providers, government agencies, etc.

    The main functions of IDC include:

    • Data storage and management: IDC provides data storage and management services to store and manage various types of data, including documents, images, videos, audio, etc.
    • Server hosting and management: IDC provides server hosting and management services, manages and maintains a large number of servers, and provides users with server leasing, maintenance, upgrading and other services.
    • Network operation and management: IDC provides network operation and management services, and provides users with bandwidth, network access, network monitoring, flow control and other services.
    • Safety assurance and management: IDC provides security assurance and management services to ensure the security and privacy of user data, including physical security, network security, data backup, etc.
    • Cloud computing services: some IDC providers provide cloud computing services, including virtualization, elastic computing, cloud storage, cloud database and other services.

    IDC plays a vital role in modern Internet applications and is one of the core infrastructures of many online services and applications

    In the first half of 2021, the overall market of China's edge computing grew at a high speed of 84.6%. It is expected that by 2025, the Chinese market will grow to US $7.4 billion, and the global market will grow to US $34.7 billion. The global edge computing server market demand will grow explosively. Inspur Edge Computing Server continued to take the first place in the market with 49.4%, and its share further expanded.

    Digital business IoT and AI scenarios have diversified demands on computing power. Driven by the Internet of Things and AI, computing power demands are not only concentrated in cloud data centers, but also extending to edge data centers and edge computing units. At the same time, diversified edge computing scenarios are also further feeding back the application development of cloud computing.

     

    In the data center industry chain, the upstream infrastructure mainly includes IT equipment, non IT equipment, software and construction projects; The midstream is the data center operation service provider; The downstream is the application industry, mainly including the Internet industry, financial industry, software industry and manufacturing industry.

    Based on this, we can IDC integrated industrial chain further streamlined and analyzed the process. Through further analysis of the whole industrial chain, we found that data is the core of IDC's comprehensive industrial chain. The collection, storage, analysis, sharing, application, and value-added services of the whole life cycle data of industrial products and production and operation activities are showing rapid changes in vitality, which has spawned a series of new products, new models, and new formats, and has accelerated the transformation of the manufacturing industry to digital, networked, and intelligent.

    It is also the same IDC integrates all elements and industry wide links, so that data can play a role between internal optimization and industry wide global optimization, so as to better solve the problem of industry information islands:

    • Data island: It is difficult to share and exchange data.
    • System islands: data problems that need to be integrated between systems that are isolated from each other.
    • Business island: enterprise internal network system problem ——Data problem/financial problem of production and marketing disconnection.
    • Control island: disconnection between intelligent control equipment, control system and management system.

    The upstream of IDC is the infrastructure and comprehensive equipment provider, which mainly produces various equipment and servers in the data center machine room; According to the type of equipment, generators, electrical equipment, UPS power supply, distribution cabinets, and cooling systems are the main cost items.

    IDC power distribution system: UPS power supply

    At present, China The UPS market is still dominated by foreign manufacturers. With the acceleration of digital traffic and domestic substitution, Huawei, Kehua Data, Keshida and other leading domestic UPS providers still have large growth space and development prospects.

    IDC cooling system: data center desuperheater

    IDC cooling system is the "cooler" of data center, which is the key to reduce PUE, and improving the efficiency of cooling system is the key to transformation and upgrading. The new cooling system can significantly reduce the PUE index of the data center. In the context of green data center upgrading, the new indirect cooling evaporation system has a large space to replace the traditional cooling system. The head cooling system suppliers include Viti/Jialitu/Aite Netneng/Imikon/Huawei/Invik, etc. Domestic equipment still has broad growth space under the background of upgrading and transformation of traditional cooling systems and domestic substitution.

     

    IDC cabinet: bearing IDC data equipment, power supply and cooling

    The cabinet is the carrier of network equipment, servers and other equipment in the data center machine room. along with IDC demand growth, IDC cabinet demand is expected to grow steadily. According to the statistics of the Ministry of Industry and Information Technology, it is estimated that by 2025, China's IDC will need 750000 new cabinets every year.

    Optical module: data center Basis of "traffic" generation

    The optical module is a component to realize photoelectric signal conversion and data transmission. The optical module is connected to the optical fiber cable to realize the long and short distance transmission of data. Common applications for The optical module speed of IDC is 100G/200G/400Gbps. The wavelength supports 850nm, 1310nm, etc. From the first quarter of 2021, the demand for 400G optical modules begins to increase, and will gradually transition to 800G as the mainstream in the future.

    Yole's latest research predicts that the global optical module market will develop rapidly at a compound annual growth rate of 15% from 2019 to 2025. At present, high-end optical modules are firmly controlled by Finisar, and the domestic market of middle and low end optical modules is dominated by Jixuchuang. Domestic manufacturers are also continuing to expand overseas markets. In the next few years, as domestic optical chips gradually replace foreign optical chips, the cost of optical module manufacturers will decline. In combination with the continuous expansion of market scale and demand, it is expected that manufacturers will have a large space for profit improvement.

    IDC switch: network equipment for signal forwarding

    A switch is a network device used for signal forwarding. The scale of the domestic Ethernet switch market has grown steadily, and the scale of the domestic Ethernet switch market is about US $4.11 billion. The market share of domestic switches is relatively concentrated, with Huawei and Xinhua accounting for a relatively high proportion.

    Server: The overall scale of server shipments in China is steadily rising

    In the third quarter of 2022, China's server shipments, Inspur released data on the global and Chinese server markets in the third quarter of 2022. In the third quarter, the global server market shipped 3.305 million units, up 20.7% year on year; The sales volume was US $27.21 billion, up 29.3% year on year. China's server market shipped 897000 units, up 20.1% year on year; The sales volume was US $6.51 billion, up 34.2% year on year.

    Servers are generally purchased by customers, Servers placed in IDC machine rooms are generally purchased by customers, which is the basis for customers to calculate and store. The expenditure cost of servers is usually part of customers' capital expenditure.

    IDC server chip: CPU chip

    The server CPU chip is the core component of server. The barriers in the server chip industry are extremely high, and only a few enterprises at home and abroad can provide products stably. Foreign representative manufacturers include Intel, AMD, IBM and ARM. The most active ones in China are Longxin with MIPS architecture, Shenwei with Alpha architecture, Feiteng with ARM architecture, Hisense, and Huaxintong.

    IDC server chip: GPU chip

    In addition to ordinary computing tasks, the server sometimes processes image related tasks. These operations are usually performed through the server GPU chip. There are only a few domestic GPU manufacturers, including Jingjiawei and Changsha Shaoguang.

    The midstream of IDC is a "comprehensive IDC" provider, which mainly includes operators, professional third-party IDC manufacturers, and traditional enterprises such as Hanggang.

    Current third party IDC vendor service modes can be divided into retail, wholesale, customization, base, and cooperative development with operators. Wholesale data centers grew rapidly, and some IDC manufacturers turned to wholesale+retail dual wheel drive.

    At present, China IDC's market share is still dominated by the three major basic telecom operators. Although operators have access to bandwidth resources, their capital expenditure budgets are relatively inflexible, and they can cooperate with third-party IDC manufacturers to jointly develop and build. Therefore, under the favorable influence of domestic policies, third-party operators have developed rapidly, and the market share of leading operators has gradually increased.

    The downstream of IDC is the application part. Under the catalysis of the epidemic situation, the IT architecture of the government and enterprise departments has accelerated its restructuring, bringing an incremental market space of 100 billion yuan. The peak period of construction in the past three years has brought potential growth space for the IDC industry driven by the upgrading of the enterprise IT architecture. At present, the domestic public cloud is still in the introduction period, and the total scale is expected to exceed 230 billion yuan in 2023, corresponding to an annual review growth rate of 35%

     

    Chapter II Business model and technology development

    2.1 IDC Integrated Industrial Business Model

    In the research of traditional sub industry model, science and technology have played a greater role, but most of them have not achieved interconnection and function. The core of IDC integration is to connect all kinds of equipment and products that need to be monitored, including fixed or mobile equipment placed in the factory and various use sites, as well as the transportation and use process of products, to achieve process traceability, remote monitoring of equipment status, fault early warning, etc., and on this basis to achieve intelligent factories and intelligent services.

    Due to the impact of the epidemic, there are many new scenarios, and New formats such as "home economy", "non-contact economy", cloud learning, cloud office, etc., promote the industry to comprehensively upgrade from traditional commodity trade to Internet based service trade. The digital economy represented by the Internet is becoming a new industry supporting economic development. The most remarkable feature of these changes is that the new generation of information technology, such as big data, cloud computing, artificial intelligence, blockchain, and so on, with data as the carrier, has become the operational basis for carrying the new cycle of economic development in the future. IDC, as an important digital infrastructure, will provide power support for major emerging industries. Under such a background, the new infrastructure policy was implemented smoothly and the REITs pilot was gradually promoted, which fundamentally solved the construction and financing problems in the development of IDC.

    According to China IDC circle data shows that the size of China's IDC market in 2021 has reached 301.27 billion yuan, with a year-on-year growth of 34.57%. In the future, the compound annual growth rate of the domestic IDC industry will be close to 30%, benefiting from the growing maturity and commercial popularity of China's 5G technology, the sustained and rapid development of the Internet industry and other factors.

     

    As a complete ecological chain, IDC's upstream is mainly IDC's hardware suppliers, that is, infrastructure service providers, including IT equipment suppliers, power system supply integrators, land, refrigeration and broadband service providers, such as servers, switches, diesel generators, etc. At present, the main companies include Huawei, Cisco, Inspur, Dell, Dawning, Schneider, Delta and ZTE.

    The downstream of IDC industrial chain is the ultimate target customer. At present, any industry that needs computing must rely on the data center. With the acceleration of the global 5G commercialization process, the traffic growth in all walks of life is unstoppable, so the end users include all cloud computing enterprises, Internet enterprises, financial institutions, etc. that need to store/run content on the IDC room hosting server. According to the annual report of the listed company Wanguo Data, cloud computing enterprises represented by Alibaba Cloud and Tencent Cloud account for a large share of the downstream customer structure. Therefore, the future cloud computing industry will have an important impact on the development of IDC.

    In fact, recently In the past 20 years, with the emergence of the Internet and mobile Internet, data interaction has shown a geometric growth trend. IDC developed in this context. Especially this year, affected by the COVID-19 epidemic, it stimulated the demand of many downstream industries for data processing and interaction, and promoted the development of IDC industry.

    • Online office and video conference: This epidemic has enabled a large number of enterprises to open the remote office mode, such as nail, WeChat, Tencent conference and other office types APP downloads grew rapidly.
    • Online education: the implementation of online teaching in various places has led teachers and students to develop a long-term habit of using online education.
    • Online diagnosis and treatment: The National Health Commission issued the Notice on Doing a Good Job in Internet Diagnosis and Treatment Consulting Services in Epidemic Prevention and Control, which clearly proposed to vigorously carry out Internet diagnosis and treatment services, and the number of major online diagnosis and treatment platforms reached one million during the Spring Festival.

    The application demand in these scenarios directly drives the growth of cloud platform companies' business. Tencent and Alibaba even had to add millions of servers at the beginning of the year, and the growth of these cloud platform companies' business will be driven along the demand chain The improvement of IDC industry market scale. In addition, it has also accelerated the digital transformation of traditional enterprises, which has led to the further acceleration of IT construction of many medium and large enterprises, and will also increase more demand for the IDC industry.

    From the perspective of industry supply side, license plate licensing, power supply, network environment, energy consumption indicators, construction cycle, etc. have always been the supply constraints of data center development, which make There is always a mismatch between supply and demand in the IDC industry, especially in the IDC market in the first and second tier cities. Because the demand continues to rise, but the energy consumption restriction policy has not been relaxed, it is difficult to bridge the mismatch between supply and demand in a certain space and time, and its investment value will be very huge.

    2.2 Business model analysis

    Based on the severe situation facing China's economy, promote The "new infrastructure" investment represented by 5G network, data center, Internet of Things, artificial intelligence, etc. is the best choice to promote China's stable economic growth. Real estate investment trusts (REITs), as a direct financing tool, are very suitable for asset types with strong real estate attributes in new infrastructure.

    at home Among IDC chain participants, trust companies have a shorter time limit for raising funds than domestic banks, leasing companies and mature foreign funds, generally 1-3 years, and trust customers tend to rely on short-term "rigid cashing" financial products. The investment of IDC projects is characterized by large capital investment and long investment construction cycle, so how to match and adapt trust funds with IDC assets has become the primary goal that trust companies need to consider when participating in IDC industry chain investment.

    On the one hand, trust companies can use short-term and medium-term funds to IDC enterprises provide liquidity loans and fixed asset loans to participate in the early infrastructure construction of IDC enterprises and solve the financing problems of IDC enterprises; On the other hand, trust companies need to aim at long-term funds, cooperate deeply with banks, insurance companies, government funds, and real estate and steel enterprises with a strong interest in the IDC industry chain, tap high-quality IDC project resources, carry out joint mergers and acquisitions and other equity investments, guide institutional funds to cultivate IDC and hold assets for a long time, and use their own resource integration advantages to accompany the growth of enterprises.

    Trust companies are developing IDC's industrial investment and financing business should be committed to identifying potential projects that meet the industry development trend and the company's risk control selection criteria, and selecting assets that meet IDC's project access criteria, have higher geographical value, and have stronger later stage operation service capabilities.

    stay In terms of IDC project access, according to the relevant provisions of the Telecommunication Regulations, the Administrative Measures for Telecom Business License and the Telecommunication Catalog, operators need to obtain a value-added telecom business license with the business type of IDC before they can engage in IDC business, so they should attach importance to the review of the qualification of counterparties. In addition, as a high energy consumption industry, the environmental protection problems caused by IDC projects have also become important reference indicators for IDC industry investment. At present, Beijing, Shanghai, Guangdong and other IDC concentration areas have made restrictions on the PUE index (power usage efficiency) of new IDC. For example, Beijing, Shanghai and other cities have issued policies requiring the PUE index of new IDC to remain below 1.4, which does not meet the mandatory energy-saving standards, The authorities responsible for project examination and approval according to law shall not approve or approve construction.

    In addition, trust companies hold shares in the form of equity under the background of continuous compression of financing loan trust business IDC projects and asset appreciation through excellent operation team management have become the preferred way to participate in the IDC industry chain. Therefore, the ability of the operation team is also the long-term value point that trust companies pay attention to when investing in IDC projects. The IDC project is not a simple infrastructure investment, and the team's initiative is crucial. Just like commercial real estate projects, the advantages of excellent service providers in project resource acquisition, operation ability, channel expansion ability and sales ability can play a decisive role.

    chart Financial model and industrial economy

     

    domestic IDC investment institutions usually cooperate with listed companies to realize investment exit through acquisition and self holding of listed companies or combination with financial products. The exit route of the project is relatively simple, the market liquidity is poor, and a large number of IDC assets are still held by institutional investors. Referring to the mature overseas market, IDC manufacturers have a large number of data center assets, and also need a large amount of funds for the self construction and acquisition of IDC resources. They often complete the withdrawal of IDC projects through the REITs (real estate trust investment funds) structure, and achieve the purpose of improving asset liquidity, reducing effective tax rates, and improving valuation levels.

    U.S.A Among the six pure data center REITs, there are two companies with a market value of more than $40 billion, namely Equinix (EQIX) and Digital Realty (DLR), the two data center giants listed in the U.S. stock market, with a market value of $66.611 billion and $40.2 billion respectively, far exceeding the market value of other data center REITs CyrusOne ($8.97 billion), CoreSite ($5.68 billion), QTS Realty ($4.66 billion) Keppel DC (US $3.49 billion).

    Equinix, as the leader of the global data center industry, has 211 data centers in 26 countries. At the same time, in order to increase production capacity in 14 countries, 32 construction projects are still in progress. Equinix's revenue grew 6% year on year (up 2% from the fourth quarter of 2019) to $1.45 billion due to the expansion of its customer relationships with Zoom Video Communications, TikTok and Hurricane Electric. The revenue of Digital Realty, whose market value is second only to Equinix, was $823 million in the first quarter, an increase of 1% over the same period last year and 5% over the previous quarter.

    The organizational forms of REITs are divided into contract type and company type. The data center REITs in the United States are mainly corporate, that is, the data center company is listed as a whole, and the investors, as shareholders of REITs, entrust the management to operate and manage. The management of REITs holds a certain amount of equity (about 10%) to reduce moral hazard. Singapore data center REITs are mainly contractual REITs, that is, single property projects will be listed after being placed in the SPV. Contractual REITs need to hire external managers to manage trust assets, which is a layer of principal-agent relationship more than corporate REITs.

    In the data center field, projects are generally divided into whole leases according to the business model (Wholesale), Colocation and Interconnection. Data center REITs mainly receive dividends from shareholders through rent and value-added services. From the perspective of REITs, the project types can be further refined according to the different control power of assets, so that different projects can benefit from REITs in different degrees (most of them are found in the annual report).

    2.3 Investment and merger

    In the context of the global digital economy, government affairs, finance, education, logistics, transportation and other fields are all on the cloud. Artificial intelligence and Internet of Things technology need a lot of computing support. The intertwined demands of the times have aroused the development boom of cloud computing. In the context of supply and demand, the expansion demands of major Internet and cloud computing customers further promote IDC followed the development trend of the industry to achieve high-speed expansion.

    Synergy Research data shows that from 2015 to 2020, the data center's M&A transaction volume and transaction volume continued to grow rapidly, with a total of nearly 400 M&As in five years. A large number of asset purchasers are operating in the form of REITs (real estate trust funds).

     

    2.4 Technical development

    Internet Data Center（ IDC) can be divided into the following stages:

    • Initial stage: IDC began to appear in the early 1990s, when it was mainly used to provide network access and server hosting services. The data center is mainly built on large-scale servers, storage equipment, network equipment and other infrastructure, and is mainly applied to Web servers, mail servers, etc.
    • Standardization stage: Around 2000, data center standardization began to receive attention. The hardware equipment and software system of the data center began to develop towards standardization, such as cabinet standardization, rack standardization, network standardization, etc. The main applications in this stage are virtual host, cloud computing, etc.
    • Energy saving stage: Around 2010, energy and environmental issues began to attract the attention of data center operators. Energy saving and green design of data center become key words. In terms of energy conservation, the data center has adopted a variety of technologies and measures, such as server virtualization, energy consumption monitoring, and low-power processors.
    • Intelligent stage: Around 2015, the data center began to usher in the stage of intelligence. With the development of new technologies such as artificial intelligence and big data, the data center has begun to introduce intelligent management technology and intelligent equipment. For example, the data center began to use AI technology for machine learning, data analysis, and automated fault diagnosis and predictive maintenance.
    • Marginalization stage: Around 2020, with the development of new technologies such as the Internet of Things and 5G, data centers will begin to develop in the direction of marginalization. The data center began to move closer to edge devices, providing users with computing, storage, network and other services closer to the terminal, and improving user experience and application performance.
    • Reliability stage: During the development of data center technology, reliability has always been the focus of attention. In order to ensure the high availability and reliability of the data center, the data center gradually introduces a variety of technologies and equipment, such as redundant power supply, redundant network, redundant storage, etc. At the same time, the data center is also strengthening the monitoring and management of the system, and improving the ability of fault diagnosis and repair.
    • Security phase: With the continuous emergence of security issues such as data leakage and network attacks, the security issues of the data center have gradually become the focus of the industry. The data center began to take multi-level security measures, including network security, physical security, application security, data security, etc., to ensure the security and credibility of the data center.
    • Independent and controllable stage: under the current national informatization and security environment, the data center continues to improve its independent and controllable ability, including independent design, research and development, operation, etc. In addition, the data center is also strengthening cooperation with domestic suppliers to promote the process of domestic substitution, so as to improve the ability and level of the data center's autonomy and controllability.

    With the continuous emergence of new technologies, the technological development history of the data center will be more diversified and enriched. In the future, more attention will be paid to the reliability, security and autonomous controllability of the data center. At the same time, the data center will also develop in a more intelligent, marginalized and sustainable direction to meet the changing market demand and user demand.

    2.5 Policy supervision

    The competent department is the Ministry of Industry and Information Technology, which is responsible for overall supervision and technical policy planning. stay Under the unified guidance of the IDC comprehensive special working group, strengthen overall coordination, strengthen departmental coordination, ministerial and provincial cooperation, and build a working mechanism that bears its own responsibilities, closely cooperates, and operates efficiently. Local competent departments in charge of industry and informatization, education, human resources and social security, ecological environment, health, emergency management, state-owned assets supervision, market supervision, energy, national defense science and technology industry and local communication administrations should strengthen cooperation to form a joint force.

    Self discipline Association is China IDC Enterprise Club, whose member enterprises are mainly domestic and foreign private data centers, basic telecom operators, and large enterprise users, such as Pacific Telecom, Wanguo Data, Zhongjin Data, Shanghai Datacom, KDDI, data centers in various industrial parks, telecommunications mobile operators in various provinces and cities, Baidu, Sina, Sohu, LeTV, Ali, 360 Shanda and others are in the operation and maintenance and procurement departments of large Internet enterprises.

    Chapter III Industry valuation, pricing mechanism and global leading enterprises

    3.1 Financial and valuation indicators

    IDC comprehensive industry valuation method can choose P/E ratio valuation method, PEG valuation method, P/B ratio valuation method, P/P ratio, EV/EBITDA valuation method, DDM valuation method, DCF discounted cash flow valuation method, NAV net asset value valuation method, etc.

    3.2 Price driven mechanism

    New Data Center

    The new data center refers to the construction of the data center based on the traditional land and according to the data center level standards IDC special buildings and ancillary facilities, and become a comprehensive data center park with complete functions.

    chart New data center cost

     

    Rebuild data center

    Rebuilding the data center refers to changing all or part of the existing buildings that do not meet the requirements of the data center to meet IDC comprehensive platform requires buildings in the data center. Through a series of analysis, we can get the project cost of rebuilding the data center:

    • The user shall purchase the buildings to be reconstructed and conduct overall reconstruction according to the grade standards of the data center.
    • The user shall transform and use a building according to the requirements of the selected area level.

     

    Long term operating cost analysis

    Long term operating costs of data centers refer to various expenses incurred during the operation and maintenance of data centers, which can be classified as follows:

    • Amortization or rental of housing construction and land costs: Amortization of land costs of self built data centers, amortization of self built or rebuilt buildings and depreciation of decoration costs should be included in the long-term operating costs of data centers. If the data center adopts leasing, the rent paid to the lessee in each period should be included in the long-term operation, and the cost and amortization should refer to the relevant system.
    • Equipment depreciation and rent: depreciation of equipment purchase costs should be included in long-term operating costs. If the data center adopts the leasing mode, it needs to pay amortization and related systems in each period. See the national financial system.
    • Water and electricity cost: the water and electricity cost of data center operation accounts for a large proportion in the long-term operation cost, especially the power cost. How to effectively save power during the operation of data center is critical.
    • Network communication costs: including telephone communication costs, Internet communication costs, telephone communication costs and special line communication costs. As the demand for communication lines increases, the cost of network communication in the data center increases significantly.

    3.3 Industry risk analysis and risk management

    IDC comprehensive security threats and risks are increasingly prominent

    Technical security issues can be said to follow closely, such as data destruction, data loss, account or business flow hijacking, insecure interfaces and API, cloud service abuse, and insufficient review of cloud computing and sharing of technical vulnerabilities before deploying cloud services. The main reason is that some IDC enterprises tend to invest less in security, and their personnel costs tend to be more business level, which leads to the opportunity for others to take advantage of security vulnerabilities.

    Compliance risk

    At present, business compliance issues should be placed at a high position, and evaluation is a very important part. National strong regulatory measures have come, or are on the way. Big name If IDC or users fail to make comments, there is a great chance that government approval will require business rectification. If they fail to meet the deadline, they will take various restrictive measures from power restriction to power outage.

    For existing projects, if the assessment is insufficient, all investments can hardly be effectively realized except for the scope allowed by the assessment. At the same time, online business rectification, user reputation and turnover have declined to varying degrees.

    Energy saving risk

    As the most important indicator of energy conservation review, PUE has caused many crises for some inefficient IDC. Beijing has issued subsequent punitive electricity tariff rules for PUE non-compliance. If the contract and lease are separated, IDC will pass on the risk to the user, which is a more direct way, but there are also certain operational risks.

    Bargaining Power of suppliers

    IDC comprehensive industry has a strong scale effect. There are fewer IDC comprehensive industry enterprises in China, and the industry competition is mild; IDC integrated downstream applications are manufacturing industries, which need strong docking capabilities; The relevant enterprises are large in scale, strong in strength, have high requirements for service products, and have strong bargaining power.

    Bargaining Power of Buyers

    On the whole, The bargaining power of IDC integrated industry buyers is prominent. Because the data center is a product with high demand side requirements, it has a great market impact. However, because IDC integrated enterprises are few at present, and they are all concentrated in high-tech fields, and the buyers of Internet products are mostly large enterprises or government policy support fund projects, Therefore, the bargaining power of buyers is relatively stable.

    Threats from new entrants

    The products and services provided by the industry have a greater impact on the production and operation of downstream enterprises. There are high barriers for products in the industry to enter the market, which also hinder new entrants to a certain extent. There are fewer threats from new entrants in the industry;

    Threat of alternatives

    From the perspective of the threat of alternatives, the industry is in its infancy, and its downstream demand application has particularity. Most products are customized products, and there are basically no alternatives outside the industry. In general, the threat of alternatives is low.

    Competitive degree of competitors in the same industry

    The competition degree of upstream products in IDC integrated industry has obvious regional characteristics. Because the data center is a product with high demand side requirements, it has a great market impact. However, because IDC integrated enterprises are few at present, and they are all concentrated in high-tech fields, and the purchasers of Internet products are mostly large enterprises or government policy support fund projects, Therefore, the project output is high, but because IDC project itself has certain risks, it is relatively narrow in the investment audience, mainly policy investment.

    3.5 Important participants of Chinese enterprises

    Nanxing Shares: Nanxing Equipment Co., Ltd., founded in In May 1996, it was a representative enterprise in China's woodworking machinery industry. The company is a national high-tech enterprise; National "Torch Plan" key high-tech enterprises; Guangdong famous trademark, Guangdong famous brand product enterprise; Top 500 manufacturing enterprises in Guangdong Province; Top 100 equipment manufacturing enterprises in Guangdong Province. The company's shares were listed on the Shenzhen Stock Exchange in May 2015, becoming the first furniture equipment manufacturer to enter the A-share market in China. Stock name: Nanxing Shares, stock code: 002757.

    Yunsaizhilian: a listed company under Shanghai Instrument&Power (Group) Co., Ltd., is a professional information technology service enterprise with cloud computing and big data, industry solutions and intelligent products as its core business.

    Incorporated in December 1986. In January 1987, the company, as the first state-owned enterprise to try out the shareholding system, issued shares to the public, and was one of the first "old eight shares" listed in China (A-share code: 600602). In November 1991, the company was the first to be approved to issue shares overseas, becoming the first B-share company in China (B-share code: 900901). In July 2002, it was selected as a sample stock of Shanghai Stock Exchange 180 Index. In December 2005, the company carried out the share trading reform.

    Easter Group (stock code: 300376 National technological innovation demonstration enterprises, national intellectual property rights demonstration enterprises

    3.6 Important global competitors

    Hong Kong Tai Po Data Center: NTT Hong Kong Tai Po Data Center is a professional data center building designed according to the Uptime Institute Tier 3+standard. It has vast space, more than 3000 cabinets on the seventh floor, high energy efficiency, and the industry's outstanding connectivity capabilities in Hong Kong, China, Asia, the world and even major cloud providers, especially suitable for technology, online games, e-commerce, online media Companies in cloud computing, data hosting and other industries help customers reach Asia and the global market more quickly and closely.

    Equinix America: At Equinix IBX Center, Equinix has access to more than 900 network operators and ISPs, including the world's largest IP backbone network, among which network operator customers include overseas AT&T, British Telecom, Deutsche Telekom, France Telecom, KDDI, NTT, Singtel, Sprint and Verizon, as well as China Unicom, Telecom The three major mobile operators and network application service providers such as Lanxun and Wangsu. Enterprise and content provider customers include Adobe Software, IBM, Electronic Arts, Facebook, General Electric, Google, HP, Sony, Microsoft, and Yahoo.

    Digital Realty: Digital Realty Trust, Inc. was established in Maryland on March 9, 2004. The company is the world's leading provider of data center, hosting and interconnection solutions, targeting customers in multiple industry verticals, from cloud information technology services, communications and social networking to financial services, manufacturing, energy, healthcare and consumer goods. The Company is a Maryland limited partnership that operates its business of owning, acquiring, developing, and operating data centers. The Company operates REITs for federal income tax purposes.

    Chapter IV Future industry outlook

    With the rapid development and application of cloud computing, Internet of Things, artificial intelligence and other new technologies, Internet data centers will face new development opportunities and challenges:

    • Large scale cloud data center: With the popularization of cloud computing services, the future Internet data center will become larger, more efficient and intelligent. Cloud data center will become cloud computing, big data analysis Important infrastructure for applications such as AI.
    • Edge computing: Edge computing will become an important development direction of the Internet data center in the future. Edge computing can perform computing tasks on devices close to end users, reducing the burden of network latency and data transmission.
    • Green energy: Internet data centers in the future will pay more and more attention to sustainable development, energy conservation and emission reduction. Solar energy, wind energy and other renewable energy sources are used to supply power, and advanced refrigeration technology, circulating water cooling system and other technologies are used to improve energy efficiency, so as to achieve green and sustainable development.
    • Security: With the popularization of the Internet and the increasingly prominent problem of data security, the security of the Internet data center will become an important development direction. Strengthen data encryption, identity verification, vulnerability management, security training and other measures to improve the level of data security assurance.
    • Multi cloud architecture: future Internet data centers will pay more attention to the design and implementation of multi cloud architecture, integrate different cloud services together, and form a more flexible and efficient Internet architecture. Multi cloud architecture will become one of the infrastructures of future Internet applications.

    past times In 2010, the global data volume CAGR was nearly 50%, and the compound growth rate of 26% remained in the past five years. In the same period, data traffic also maintained a rapid growth. The growth of data volume drives the IDC demand of global data centers to maintain at 15%~20%, and the annual growth of China's data center demand exceeds 30%. The epidemic accelerated the process of global digitalization, and the demand for streaming media, e-commerce, video conferencing, remote office and other services increased rapidly and remained high. In addition, enterprises accelerate their migration to the cloud, and 2C and 2B requirements jointly drive the growth of data center requirements. In the future, driven by new technologies such as 5G, AI, IoT and application scenarios, global online data traffic is expected to enter a new round of growth cycle, driving data center market demand further beyond expectations.

    View details

 

Japon Network - a professional IDC integrated service provider.   Because of focus! So professional!

Floor 2, Block E, Building 6, West Taihu Science and Technology Industrial Park, Wujin District, Changzhou, Jiangsu Province

CopyRight 2022 Japon Network All rights reserved