Aliyun (AliCloud), the cloud computing division of Alibaba Group, has announced that it will open its first data facility in Hong Kong on May 12.

This move marks Aliyun's initial step in its international expansion plans. The opening of the data center was announced less than a week after Alibaba had listed in the US in one of the biggest initial public offerings (IPOs) in the industry, according to TechCrunch.

Like Us on Facebook

It would seem that Aliyun is not keen to expand into the US. It is instead aiming to tap into Chinese companies in Southeast Asia and the Greater China region.

Alibaba explained that Chinese firms wanting to open businesses beyond the border of mainland China would need to set up additional local Web servers to handle the higher volume of traffic. This usually entails dealing with additional Internet regulations in every country.

Renting the servers of Aliyun will help companies get around those regulations, reduce costs, and facilitate easier entry into a new market. At present, Aliyun runs three data facilities in Beijing, Hangzhou, and Qingdao.

Among Aliyun's strongest competitors is Amazon Web Services (AWS), which has recently expanded into China. This is the first time that Amazon has entered the business of cloud computing in the Asian country.

The clients of the Alibaba subsidiary include Xiaomi, Kingsoft, Qihoo 360, and other big tech names. AWS also caters to small and medium-sized businesses (SMBs).

Although there are several American tech firms such as Google and Facebook that have failed to enter China due to censorship and tight regulations of its government, cloud computing now provides an entry option for them because of the lack of infrastructure.

To accommodate the country's increasing number of smartphone users, the Chinese government is pouring a lot of cash into the construction of data centers in the country.

China's cloud computing industry's value is expected to rise to $122 billion in 2015, according to information presented by China Software Industry Association.