Speaking at an FICCI (Federation of Indian Chambers of Commerce and Industry) event, Jeff Bezos, CEO of E-commerce giant Amazon, said the company is considering setting up a data center in India for its AWS (Amazon Web Services) cloud.

Research firm Gartner estimates that the public cloud services market in India will grow from US$423m in 2013 to US$1.3bn in 2017, making India the fastest growing cloud market in the world.

Gartner research director Naveen Mishra said in August: “we hear that Amazon is considering setting up a data center in India but nothing has happened yet.”

Big potential

Earlier this week during a visit to India, Microsoft CEO Satya Nadella announced that his company is building several data centers in the country - which are expected to be fully operational by 2015.

It looks like Amazon could follow suit. “We have AWS. We started it long time ago and it has grown into a very large business, separate from our consumer business,” Bezos said.

“We are building new data centers and are looking where we should put them and evaluating these in India as well.”

In July, Amazon announced an additional investment of $2bn to beef up its operations in India, where e-commerce is still in its nascent stages. Bezos said ‘Amazon.in’, which was launched last year, has rapidly expanded to serve customers in India and is on its way to hitting US$1bn in gross sales.

“India is unbelievably energising; the people are focused on learning and extremely inventive,” Bezos said.

Cloud wars
Bezos said the AWS business has grown incredibly fast. Earlier this year AWS entered a ‘cloud price war’ with Google and Microsoft in a bid to drive higher sales.

In its Q2 2014 results – ended June 30 – Amazon recorded net loss of US$126m up from US$7m last year. Bezos put this down to the decrease in prices of AWS and higher investments for its retail products and online services.

In a recent move in the price slashing wars, Google announced it has cut the price of its Compute Engine cloud Infrastructure-as-a-Service (IaaS) product by approximately ten percent worldwide.