[Shenzhen, China] Interview with local subsidiary after entering China

BEYOND's Chinese office, " Yeyou Technology (Shenzhen) Co., Ltd. ," has begun full-scale operations in China from February 19, 2024.

This time, we interviewed Mr. Ohara and Mr. Takashiro from Beyoutoku Technology (Shenzhen) Co., Ltd.

◆ Interviewer: Asaka Komatsu (Beyond Public Relations)

Please tell us how you entered the Chinese market and what your current efforts are in China.

Ohara : Around 2018, Chinese services such as Alibaba Cloud started to enter Japan more and more, and when we felt that Chinese IT services were gaining momentum, Beyond also started considering entering the Chinese market. This is the trigger.

The first thing I did in preparation for my expansion was to visit various regions in China. We will continue to conduct research by conducting interviews and meetings with local Chinese companies and similar Japanese companies that are expanding into China, and at the same time, we will discuss how to open a local subsidiary in China and how to prepare for opening. We have also made progress little by little.

However, in the midst of this, there was a time when we were unable to travel to China due to the spread of the new coronavirus, and Beyond's research and exchanges in China were at a standstill. So I started gathering information on the internet and looking for partner companies.

Takashiro: In the Shenzhen and Guangdong province areas where we are located, there are many customers in the manufacturing industry, but I get the impression that there are very few IT companies like us that mainly operate server infrastructure businesses. We are working on thinking about how to develop Beyond's services in such fields, and what kind of needs there are, as our themes.

---Is your China office business an extension of Japan?

Ohara : First of all, Beyond operates a business called ``MSP'' in three countries: Japan, China, and Canada, where we handle the construction and operation of clouds and servers such as AWS and Alibaba Cloud.

The business of this Chinese office is also an extension of Japan, but when people ask, ``We're doing well in Japan, can we do the same in China and other countries?'' That's a different story. .

I feel that localization is necessary, such as adapting to the culture and business practices of China and other countries, and what kind of services are needed, so I am repeating trial and error in that area.

Please tell us about the differences in business between Japan and China.

Ohara: In Japan, when you meet a customer for the first time, you exchange business cards with the customer, actually greet them, exchange information, and have a face-to-face conversation as if there is anything you need. There are many.

However, in China there is a strong tendency to have a referral culture where people buy from or do business with acquaintances, and this difference in business customs makes it difficult. Also, as IT services and apps are becoming more widespread, I feel that most things can be completed using WeChat and its mini programs, which is a big difference from Japan. I think so.

---Are WeChat, SNS, etc. important in China?

Ohara: In addition to WeChat, smartphones are a very important lifeline. In fact, in everyday life, we can't do anything without a smartphone. In terms of business as well, communication is based on WeChat, and more than 90% of the transactions are completed through his WeChat. Many people don't have paper business cards in the first place, so most of them start greeting each other by exchanging contact information on his WeChat.

---Are paper business cards not used much?

Ohara: There are paper business cards, but I don't think they're as important as they are in Japan. Also, when we exchange contact information on WeChat, we can send business card data and create that business card data using his WeChat mini program app, so we rarely exchange paper business cards.

Takashiro: When I was in Japan, I was told that there was a difference between business in China and Japan, and one thing that stood out to me was the "sense of speed." Before I went to China, I had heard that communication and response times are very quick in China, but when I actually worked there, I got the impression that they were really quick and agile in communication and response times. I had an image of speed, but since I had nothing to compare it to, it was just an image. As is the case in my daily work, the people I interact with are all really quick to respond.

For example, when it comes to quality, I think Japanese people have a mindset of ``submitting to the customer in a state as close to 100%'' as possible. On the other hand, in China, work is carried out in the following manner: ``We submit the work to the customer at a 50% to 60% degree of completion, then make corrections to bring it to 80%, and then a few more exchanges to bring it to 100%.'' I feel like it's happening.

In terms of speed, it's certainly fast, and it may feel like everything is progressing. When I think about Japanese business customs and the way work is done, I feel that there are quite a few differences between Japan and Japan.

---Was that something you felt only because you actually went to China?

Takagi: Yes. Even if you are in Japan, you can learn about it by looking it up on YouTube or Google search, or by hearing stories from friends. I feel like we were able to get to know each other in the truest sense because we had the experience of actually living and working in China.

---If that's the case, then if you don't have a sense of speed, won't you be accepted?

Takagi: I think it's a possibility. For example, let's say we proceed with something based on our common sense and predicting that ``this will be the best for the customer.''

However, if we do not understand that what we define as the best is not necessarily what the customer thinks is the best, I think the difference in speed will become apparent. In this regard, I think it is necessary to take action to adapt yourself to the culture of that country to some extent.

Please tell us about the gap between the Chinese cloud market and the Japanese market.

Ohara: In Japan, I think AWS has a large share, followed by Azure and GCP, but in China, Alibaba Cloud has a large share, followed by cloud services such as Huawei Cloud and Tencent Cloud. Masu. China also has AWS and Azure, but they don't seem to have an overwhelmingly large market share like they do in Japan.

---When you think of cloud in China, do you think of Alibaba Cloud?

Ohara: In addition to Alibaba Cloud, Chinese customers also use different server environments according to their needs, including clouds such as Huawei Cloud and Tencent Cloud, as well as clouds and hosting provided by local data center operators in China. I am. I feel like this varies from person to person depending on their image, so I can't generalize.

---Do you handle the Chinese version of AWS?

Ohara: Beyond is multi-cloud compatible, and AWS also builds and operates infrastructure using various cloud platforms such as Alibaba Cloud. This is the same system at Beyond's China office, which is built and operated in the cloud according to the needs of Chinese customers, so there is no problem either way.

Additionally, the Chinese version of AWS can only be opened and used by companies with local subsidiaries in China, so Japanese companies that do not have local subsidiaries in China cannot use it even if they want to. In this regard, Beyond has established a local subsidiary in China and is now able to use the Chinese version of AWS, so we are now able to provide technical support for the Chinese version of AWS.

Please tell us the differences between MSP technology and companies in China and Japan.

Takashiro: Previously, I participated in the Huawei Cloud partner event (Huawei Cloud APAC Partner Connection Summit) held in Dongguan, China, and when I spoke with partner companies similar to Beyond, I was impressed by the industry. I had the impression that there were many cases in which they focused on providing MSP-like services.

For example, I heard that a company specializes in fields and industries related to fintech and AI, and even builds and operates infrastructure. It is true that if you specialize in a certain field or industry, you can reuse similar technologies even if the details are different, creating an environment where it is easier to accumulate knowledge within the company, making management and operations more efficient within the company. It looks like it's done.

Currently, Beyond's China office does not have a specific industry in mind, and our sales and engineering teams work together to advance the project, depending on the customer's case or project. However, with other overseas vendors, I had the impression that a surprisingly large number of companies focused their MSP services on one industry only, so that is what makes Beyond different.

Indeed, by narrowing down the target industry/field, it may be less likely that you will be in complete competition with other vendors, and I felt that it would also lead to differentiation from the competition.

How are Beyond's technologies and services received in China?

Ohara: Currently, I am mainly working on projects for Japanese companies, so when I introduced Beyond's technology and services, I heard that they felt there were issues with the current state of the system at their Chinese subsidiary. I listen carefully.

In addition, there are cases where people say, ``In Japan, we are able to use AWS to a certain extent, but we don't really understand Chinese clouds such as Alibaba Cloud.'' Japanese IT vendors that can flexibly respond to these challenges are It may be surprisingly small. When faced with such a situation, I feel that there are many Japanese companies who have latent concerns, thinking, ``I wish I could ask a Japanese IT vendor who understands Chinese cloud technology.''

Takashiro: Beyond provides technical support, of course, but I think one of the great features of Beyond is that it is staffed 24 hours a day, 365 days a year by engineers who are knowledgeable about server technology.

This may not be unique to China, but when I talk to various people, I find that while they say they are available 24 hours a day, 365 days a year, they say, ``The reception itself is available 24 hours a day, but the actual work is as follows. We often hear stories such as, "The server operation itself is outsourced to another company."

On the other hand, as is the case in Japan, Beyond often receives favorable reviews from customers for its ability to provide technical support 24 hours a day, 365 days a year, while its own engineers interact with customers. In this regard, we have received good responses even when we are expanding our services in China.

---Do the strengths of Japanese services resonate in China as well?

Takagi: Yes. Although price competition is fierce in the Chinese market, Beyond has this advantage, and I feel that this is a strength that allows us to demonstrate the basis of the value of our services.

---Is price particularly important in China?

Takashiro: I think this is not limited to IT services in particular, but ultimately there is price competition in every field. This may be fine for those receiving and enjoying the service, but for the service provider, how to consider the price and provide it is a very important factor.

Please tell us about what we can do and what our strengths are.

Takashiro: First of all, I think that having a local subsidiary in China is a really big deal, and through the actual experience of being stationed there, I am absorbing first-hand information about China, so my knowledge increases every day. Our strength is that we can deliver superior information, not just information gleaned from the news or the internet.

Unless you are actually in China, there are many cases where you cannot understand the situation, so by transmitting an approach from China such as ``This is how we will proceed'', we can put ourselves in the customer's position. I think that's one advantage.

---It seems to be a source of peace of mind for customers.

Takagi: Yes. I would be happy if it could be a source of peace of mind.

Ohara: Our Chinese office is located in Shenzhen, which is known as the center of technological innovation in Asia, so we can quickly catch up on new technologies and ideas.

Other Japanese IT vendors tend to have their headquarters geographically close to Japan, such as Shanghai or Dalian, but this may be due to the fact that there are many hardware companies in Shenzhen. I feel that there are few Japanese IT vendors that handle such server and software services, so Beyond can be expected to have an advantage there as well.

I feel that Shenzhen's location is great because it allows us to provide local IT support for Japanese companies in trouble in Guangdong Province, and because it is close to the Hong Kong area, we can expand our business.

In addition to being a Chinese cloud MSP, we can also handle web system development, Chinese homepage production, WeChat mini program development, etc. We are able to proceed with projects while working closely with Beyond's Japanese headquarters, which is another source of peace of mind for our customers.

---Are there any things you brought in because you established a local subsidiary in China?

Ohara: Yes, like opening a local subsidiary in China, there were many things that I didn't realize until I actually worked and lived there. In particular, there were some problems with the Internet, and because of our own experience, we were able to launch a SIM service that can be used in Japan, China, and other countries.

We came up with this service because we felt that ``the things that we had trouble with are also needed in the world,'' and we actually use it not only for ourselves, but also for other members of Beyond when traveling overseas or on business trips. I am using this service.

◆ Global eSIM service “Beyond SIM”
◆ Chinese SIM service “Choco SIM - powered by beyond -”

How do you differentiate yourself from Chinese IT vendors?

Ohara: Beyond's MSP supports the stable operation of our customers' systems and applications 24 hours a day, 365 days a year, and continues to support their business.

However, in order to maintain high-quality technical support 24 hours a day, 365 days a year, there is an unavoidable barrier of "nighttime support," so it is difficult for each country alone to provide constant and stable technical support. I think it's difficult.

In the case of Beyond, we also have a base in North America (Canada) as a wholly owned subsidiary of Beyond, so we are differentiated by our ability to provide high-quality technical support that takes advantage of the time difference between day and night. I think there are very few IT vendors, not only in China but also in Japan, that have established this operational system.

Takashiro: What we especially want to appeal to our Japanese-affiliated companies in China is that, of course, we can provide services in a way that is similar to what we would experience in Japan, and with the same quality as in Japan, not only in terms of language, but also in terms of language. In a sense, being able to express Japanese characteristics and work together with customers is what differentiates us from local IT vendors in China.

Please tell us about the future strategy and business development of Yoshitoku Science and Technology.

Ohara: We will develop a service that will become synonymous with "If you are looking for science and technology, then this is the service for you." In addition, it would be interesting to re-import the services developed by Shiyoutoku Science and Technology to Japan and develop them in the Japanese market. Also, I would like to expand the market within China and provide services to countries such as Southeast Asia while being based in Shenzhen.

---So it's not just limited to China.

Ohara: Since Shenzhen has relatively easy access to other countries in Southeast Asia, we are considering business collaboration involving such countries and regions in the future.

In Southeast Asia, where the economy is rapidly developing, although it may not be exactly the same as China, there are bound to be some similarities, so when considering cultural areas and time differences, it is still easier for Japanese people to expand compared to other countries. I think so.

Also, in Japan, the number of inbound tourists is increasing considerably, perhaps due to the weak yen. For the future, I would like to continue to develop his WeChat mini program for Japanese companies to attract inbound customers between Japan and China.

What do you most want to convey to your Chinese customers?

Ohara: Since we are ``Beyond's MSP in China,'' I would like people to try using Beyond's services.

Takashiro: BEYOND has many engineers who act flexibly and are technically capable, so I would be happy if they could entrust us with servers and infrastructure in China as well!

summary

This is an interview from Beyond's China office.

Through this interview, I feel that my image of China, which I had not been able to imagine very concretely before, has gradually become clearer by actually listening to their voices. Of course, this time's content is only a small part of China and its history, so I would like to continue catching up on various information in order to further deepen my understanding.

There is no doubt that the establishment of the China office, Biyou Technology, will have a major impact on Beyond as we create a new future. Please continue to pay attention to developments at Beyond's China office, Beyou Technology.

Beyond and Biyoutoku Technology provide technical support for cloud/server construction and operation for Japanese companies and local subsidiary customers expanding into China.

If you are a Japanese company in China and have any trouble with cloud/servers or systems, please feel free to contact us.

◆ Interviewer: Asaka Komatsu (Beyond Public Relations)

Company Profile

● About Beyond Technology (Shenzhen) Co., Ltd. (
https://beyond-shenzhen.cn ) * English: Beyond Technology Shenzhen Co., Ltd.
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Chairman: Masahiro Haraoka
General Manager: Yuya Ohara
Headquarters: Guangdong No. 5, Fulin Hotel Building 5 (Chuangfu Port), No. 1085, Heping Road, Luohu District, Shenzhen, Province
Established: August 31, 2023
Capital: 20 million yen (Japanese Yuan)
Business content: Cloud/server business, system development business, Japan-China IT business support
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● Main services
◇ China cloud / server construction / operation maintenance
◇ WeChat mini program development
◇ AWS China region cloud construction / operation maintenance / monitoring service
◇ Aliyun cloud construction / operation maintenance / monitoring service
◇ China SIM Service "Choco SIM - powered by beyond -"
◇ Chinese Cyber ​​Security Law Grade Protection System Certification Support
◇ Japan-China IT Business Support