Welcome back. In this part of the course, we're going to switch gears a little bit and focus on what we call, Go China. We used to refer to this as China Gateway. Essentially it is a set of Alibaba Cloud solutions that are geared at helping businesses enter the Chinese market. I know that this isn't directly relevant to the ACA or ACP exam, but I assume if you're taking this course because you're at least a little bit interested in Alibaba and probably by extension China. This part of the course will serve to inform you about the regulatory environment in China for foreign businesses, especially online businesses, and how we can help you navigate that because it really is different from the rest of the world. There's a lot of material to cover here. We're going to start out in this video by covering these everything except the last two items here. We'll talk about why go China, challenges and solutions, the three C's, then we'll get into some more specific technical material around ICP licensing, network security, content security, and personal information protection. Then in the next video, we'll get to the last two sections here, tying it all together and phases and scenarios. Let's jump right in. Why Go China? Well, there are a lot of answers to this question, but the obvious one is, scale. It's all about scale. There are 730 plus. I think this is actually higher now, this is an old number. There's more than 731 million Internet users in China that's far more than the United States and roughly equivalent to Europe, at least Western Europe. This is a very, very large number. It's not just that there are a lot of users, everything else operates at an enormous scale too. These are 2018 figures, actually, these are all higher now. But in 2018, Alibaba's annual GMV was $768 billion, was 600 million annual active users of our e-commerce apps, 666 million monthly active users on mobile, and then a 100 million packages being delivered a day across the country. Everything here happens on an enormous scale. This 2018 figure on the right here for AliPay, 900 million users, that's now more than a billion. AliPay is I think now the number 1 online payment platform in China. Alibaba Cloud is the support tier that makes all of that possible, where the infrastructure that the rest of the Alibaba group is built on top of and maybe your business also if you choose to get into China. If you want to be apart of this enormous online space, then please consult with us. We'd be more than happy to help you get into the Chinese market. What are the challenges and solutions? Well, it's not easy to get into China. It's a very difficult market to do business and as a foreign company, it's big and it's very highly regulated. Most of you have probably heard about the great firewall, see you know that a lot of website content is either filtered or blocked out. If you want to visit Google and use Google Search or Google Mail, use Facebook, Instagram, most of those things are blocked here. There's also the physical distance issue. If your users are in China's Western provinces, that's a long way for data to travel. If your server is in Shanghai and your customers are in Xinjiang, it's going to take a while just for that packet to physically get there because China's very large country geographically. There's also a split in terms of the telecom providers. There are certain telecom providers that are more prominent, more prevalent in Northern China and some that are more prevalent in Southern China and they don't always pier with each other so it can be very difficult to get your traffic delivered to your end users reliably. If you're on a different telecom provider than your end-users are, there's the network security law to comply with. If you want to start a website, you need to have a special license called an ICP in order to start your website. Before you deploy a server in China, you need to go through what we call real name registration. You actually have to have a real name and ID number, like a passport number or an ID card number on file before you can even startup any ECS virtual machine. There's a lot to contend with that is new in the Chinese market that you might not be used to outside. There are essentially challenges in three domains. The first challenge is regulation. That's applying for an ICP license for your website, understanding the Network Security Law, personal ID before you can deploy a virtual machine, all of that. Then there's Infrastructure, that's the second challenge. Again, China's a big country, you really need to do a lot of advanced planning. Think about where your users are going to be, think about how you're going to deal with the top three telecom operators. Then there's the cultural differences, there're local marketplace. China is a very unique place. It's not only big, it's very different from its neighbors culturally, very different from the rest of the world culturally, so you have to be prepared to adapt to this new environment. There are market and license differences, and it's a very global-first society. Most applications that succeed here, succeed because they have a strong mobile user interface, a strong global presence. You can't get away with just having a desktop or a PC website in China because it's a very mobile-first society. So how can you answer these challenges? This is where Alibaba cloud comes in. This is our home market, this is the area we know best. This is where we can help you out. We are the number one cloud provider in China, bigger than the next three or four competitors combined. We currently control about 40 percent of the public cloud market in China were are also the number one in Asia, we are actually bigger than Microsoft and AWS in Southeast Asia, and we're growing worldwide. We continue to expand and grow and add more data centers and locations both inside and outside of China. Let's talk a little bit about this concept of the China Gateway. I mentioned the 3Cs earlier, so the 3Cs are; Cloud Infrastructure, Compliance and Comprehensive solutions. The idea here is we can help you with these three things. When you're getting into China, you need help with cloud infrastructure, compliance, and comprehensive solutions, and we're there to offer support. The mission and vision of the company is, to make it easy to do business anywhere. Actually, you can see that on the slide here with the Chinese above it, in the figure on the right. To make it easy to do business anywhere that's the overall goal for Alibaba. We're happy to help you get into this market if we can. The first C, Cloud Infrastructure, let's talk a little bit about Cloud infrastructure. Alibaba's global infrastructure is 22 regions at 66 availability zones with 2800 plus CDN nodes. The CDN nodes are distributed across 70 different countries, so we have the infrastructure to provide you with cloud services no matter where you are, no matter where your end-users are, and in particular if you look at the right side of the figure here, we have a very large cluster of data centers throughout Asia and particularly in our home market, China. Inside of China, we're well-distributed across the north and south of the country, and we've even got some databases out in the west now as well. We also offer global connectivity. You can connect Alibaba Cloud data centers in any region to any other region over our private network backbone. We have a tool called CEN, Cloud Enterprise Network that can help you do that. No matter where your virtual machines are located, no matter which Alibaba Cloud services you're using, in which region, you can connect them seamlessly together inside and outside China. One of the key services we provide for companies that are based outside of China is our network services, in particular Cloud Enterprise Network or CEN, which you can use to establish low latency, high speed links between regions inside China and regions outside. If you're a business and you're trying to use a service that's difficult to use in China or you're having network latency issues, you can use CEN to overcome those. Traffic passing over CEN, passes over Alibaba clouds private network backbone, so it is much faster than traffic passing over the Chinese border, over the public internet. In addition to CEN, we provide VPN gateway, so that you can connect mobile clients or individual computers up to CEN. We also provide a device called an SAG, a smart access gateway, which can also be used to help a small office or maybe a department store connect to your Cloud Enterprise Network on Alibaba Cloud. An SAG is like a router device that you would put in the corner of your office, and then any computer that connects to this SAG will be automatically connected to your CEN private network. So you can link up your offices around the world no matter where they happen to be. But it's not just Alibaba Cloud products and services and Alibaba Cloud Infrastructure. Yes, that's a big component of it, we do care about our 66 global AZs and we're proud of the 200 plus products that we've built. But really, Alibaba Group is supposed to be a business enabler and infrastructure alone might not be enough. So of course, by being an Alibaba Cloud customer, you can tap into other parts of the Alibaba Group Ecosystem like team all for online stores, tying out for deliveries and financial for payments, Gauta maps for street level mapping and navigation. There's a lot of other components of the Alibaba Ecosystem that you get access to. Now let's talk about the second C, Compliance. How do we solve compliance issues? Well, you're going to hit a few compliance issues when you try to get into the Chinese market. If you're new to the market, you won't have a local entity, which means a local business license in China, and a local office, which means it will be hard for you to apply for an ICP license. You'll also have to deal with cyber security law compliance issues around transferring data across the Chinese border, for instance, some types of data on Chinese citizens has to remain in the Chinese mainland. So you have to have solutions to some of these issues. Alibaba Cloud provides a complete set of CSL compliance solutions that are designed to help you deal with some of the more complex regulatory requirements of the CSL. By the way, CSL means Cyber Security Law. This is a law that was passed and went into effect in 2017. It governs essentially how online platforms and businesses work in mainland China. If you take a look at the gray boxes in the bottom, you can see some of the regulatory challenges you face under the CSL. Then in the orange boxes on the top, some of the solutions and products that we have to help you solve those issues. For instance, there are provisions in the CSL that require you to store data locally in China and to encrypt and protect consumer data. We have backup and encryption tools to help you with that. Then there are other requirements for logging network traffic and maintaining those logs for a certain period of time, usually six months. We have security center and cloud firewall to help you with those requirements. We also offer a variety of consulting services. We do most of this through our partners. For instance, we're partnered in China with Deloitte. Deloitte can provide cybersecurity law consulting in the following areas. I won't spell out everything on the slide, but it's a wide variety of consulting services that they can provide. We also have local partners who can help with registering that local entities of Chinese business and with ICP filing or licensing. The "Third C", comprehensive solutions. Let's take a look at what solutions we can offer. One of the first issues companies run into when they try to get into the Chinese market is the cross-border network connectivity issue. What some companies will do as in step 1 here on the slide, is they will try to make use of the public internet. Unfortunately, if you're trying to access something that's based overseas from within China, there's a very good chance that you will have limited bandwidth, packet loss, and relatively high latency, especially if it's something like Google Mail or Google Drive that's not normally accessible within China. You can get around some of those issues by using a leased line. Perhaps you deploy a leased line from your site in China to Hong Kong, and that will get around some of the packet loss and latency issues, but it ties you to a particular telecom operator. It's very expensive, there's high up-front costs and it's not very flexible. You cannot adjust the bandwidth of the lease line up and down on demand, which is why we recommend number 3, here on the right-hand side of this slide, which is where you use Alibaba Cloud, CEN, our internal network to dynamically allocate bandwidth between different Alibaba Cloud regions. Then you use the CEN to route traffic between those regions over Alibaba Clouds private network. This allows you to create a truly global enterprise private network on top of Alibaba Clouds backbone infrastructure. Let's just look at one scenario where you could use Alibaba Clouds, CEN to achieve acceleration for some cross-border applications that you want to use. Let's assume that you've opened your first office in China and now your employees need access to Salesforce or SAP or Office 365. How are they going to get that? If they go over the public internet to a region outside China, it's going to be very slow. What you can do is use a VPN tunnel or a smart access gateway device deployed in your branch offices in China to connect up to Alibaba Cloud CEN, that traffic can be routed to another Alibaba Cloud region, like our region in US West Silicon Valley or our region in Frankfurt, Germany. Then the traffic can egress from there back onto the public internet and access Office 365 or Salesforce or whatever third-party application you need without any delay or latency, as would normally be the case over the public internet for service outside of China. This is a way to get accelerated access to foreign applications for your business users within China. Let's now move on to ICP licensing. Let's talk a little bit about what an ICP license is. I want to start the ICP license section by clearing something up. Even though in casual conversation we often talk about ICP licenses. Technically to types of ICP. There's the ICP filing and the ICP license. The ICP filing is what you need for a noncommercial website. The ICP license is what all commercial websites must have. Also if you can read Chinese, you'll see that there's this table on the left. The type of ICP filing you have to perform is based on the type of business that you're operating. These categories here, B11, B12, B13. These are decided based on what industry you're company operates in. Depending on what industry you're in, there may be more or less stringent requirements for your ICP filing or ICP license. How do you decide if you need an ICP license? Well, it's fairly and simple. The table is a little bit complex, but if you look at it, you'll realize that there's a clear distinction between when you do and do not need a license. The distinction is, are you hosting a public web service or not. If you're connecting your local IDC in China to an overseas IDC for your employees. You don't need an ICP license if you're conducting your local employees in China to a local service that's only for them to use, that's hosted on an ECS instance on Alibaba Cloud or on another cloud provider. Then no, you don't need an ICP license for that because it's just for your own employees. It's not being made available publicly to other people. However, if you're accelerating your website for general Chinese users, even if that just means using CEN in China, not even hosting your site in China, then yes, you still have to have an ICP filing or a license. If you're launching a new domestic website in China? Yes, you need an ICP. If you're launching an online shop, yes you need an ICP. The distinction is whether or not the service you're offering is a public facing web service. If it is, you need at least an ICP filing, and if you plan to accept money, then probably an ICP license as well. The application process is fairly complex and you need to collect information about your Chinese business entity, you need to take photos against a specific backdrop and submit them along with your filing. You need to have a host or a server instance of some kind, located within mainland China, you need to register your domain name and get that recognized by MIIT, which is the authority in China that handles these kind of registrations. You need to have a local Chinese phone number, and you need to apply through your telecom operator or cloud provider for the ICP license or filing. This can all be quite complicated, especially since the filing form itself is on a government website and is only available in Chinese. But don't worry, we have a portal on alibabacloud.com that can help you understand the ICP process and help you to complete your filing. In fact we list all the steps required on the website and we have links that can help you get through each step and understand each step. But again, it's ideal to have someone who speaks Chinese to help you with this process, as you might want to find a local partner who can help you navigate the final filing. Network security, risk management in the network security domain is a major part of complying with China's Cybersecurity Law so I wanted to include it here in the talk, so Article 21 of China's Cybersecurity Law, the CSL, states that operators have the following duties, and you'll notice that there are specific duties here like prevent computer viruses, prevent attacks, prevent ex-filtration of customer data, and that these duties all come with fines or penalties if you fail to perform them. Having adequate security in place is something that is a requirement under the cybersecurity law, backup and encryption of data is also a requirement under the cybersecurity law. In order to help you with this, we have a variety of compliances and certifications for our own cloud platform, so if you are worried about us being compliant with SEC or ISO 27001 or you're wondering whether or not we have PCI DSS? The answer is yes. We are a fully certified cloud platform. On top of that though, you need to do some work to secure your own systems, to help you with that, we offer cloud firewall, which we discussed earlier in the security system, which could protect you against threats on the internet and internal threats within your private network. We have web application firewall, which can prevent certain types of injection attack, cross site scripting, and some types of data exfiltration or theft as well it can help prevent against those. Then security center to help you with monitoring, logging and to help you in post attack analysis, if someone does succeed in attacking your site. Content security, we can also help you here. We talked again in the security section about the content moderation service. Under Article 47 of China's Cybersecurity Law, network operators shall strengthen management of information published by users. Unlike under say, American law, where information published by users is the user's responsibility. Under Chinese CSL, the information that users put on your platform is your responsibility, and so it's your job to keep information that's not allowed or that is prohibited off of your platform, including things like pornography. We have the content moderation service to help you do this. Again it's a symbol API that you can build into your application, which will perform an automatic review of text, images, audio, and video to look for content that falls into those categories that are prohibited by the CSL. It's just an API, you submit a piece of text or a video to the API and it will analyze it and give you back a result telling you whether or not this content should be allowed. Of course you can have humans do a second step review if you're not sure. Personal information protection, so Articles 24, 41 and 42 of the CSL, talk about the need to collect users real identity information when they sign up. If you're allowing users to sign up for your platform in China, you need to collect their identity information, you can't allow anonymous users. You need to be clear about what user data you collect. You need to be clear about that both with the government and with those users, and you're responsible to prevent the leak of any of that information. Under Article 42, if you fail to do that, there are stiff fines and penalties in place. You have to collect certain amounts of personal information in order to comply with the law, but on the other hand, if you've leaked that personal information there are penalties. It's a tough law to fully comply with. You really need to think well ahead about what you need to collect and how you need to protect it. In order to help you with identity verification for your users, we offer a identity verification service, so this is again, essentially an API that you can call, which will match a picture of a user's face with their Chinese ID card. You can use that to authenticate users at sign up time. Make sure that they are legitimate real users. We also provide a database backup tool called DBS Database Backup Service that can provide real time incremental backups of Alibaba Cloud Databases. Again these are both local and encrypted, so there's encryption in transmission and at rest to protect your data and keep it local in China if that's required. That's all for this video. In the next section, we'll see how we can tie all this together and apply what we've learned to chart a path into the Chinese market.
