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Secondary Markets for Data Centres Thrive Throughout Asia Pacific

Andrew Fray • 25/05/2021

Secondary Markets for Data Centres Thrive Throughout Asia Pacific

Andrew Fray • 25/05/2021
Kevin Imboden, Senior Global Research Manager specialising in Data Centre Insights, discusses how Jakarta, Mumbai, Seoul, Kuala Lumpur and Osaka, are growing secondary markets that are driving Asia Pacific’s potential as a key region for data centre growth across the next decade.

As ever more corporations and government organisations continue their IT transformations, these increasingly sophisticated users have demanded lower latency and a greater array of services from operators and major cloud platforms alike. In turn, these companies have embarked on development of new facilities in previously overlooked cities, launching considerable ecosystems that were once the hallmark of more established markets such as Tokyo, Sydney, Singapore, or Hong Kong. As these clusters form, the fiber, peering, and scalability that each city offers leads to ever-greater opportunity for development.

Certain growing markets serve as the entry points to their respective large countries, such as Jakarta or Mumbai. Jakarta serves as the largest and city and business hub of what was once arguably the most underserved data centre market in the world, now rapidly developing thanks to the proliferation of local applications requiring ever-increasing capacity. Hyperscale cloud services have rapidly moved in over the past couple of years, and several new operators have formed to construct large-scale facilities. 

Mumbai has enjoyed an explosion of interest, with global platforms such as Equinix or EdgeConneX competing against local firms such as Yotta Infrastructure or Sify in a battle for market share in what will soon be the largest market by population in the world. The growth in Mumbai has occurred as several other markets across the country have received considerable development capital, with the Delhi-Noida region, Hyderabad, Bangalore, and Chennai among the vanguard of these new expansions.

Cities can become data centre hubs for a variety of reasons. While Seoul is a primary market from a connectivity and overall capacity perspective, international operators are just beginning to compete locally, and global companies have begun to consider the city as a hub for regional deployments. These new possibilities have raised the profile of Seoul on the global data centre stage, showing the market to be exceptionally sophisticated and ready for further growth. 

Kuala Lumpur has long enjoyed the adjoining technical hub of Cyberjaya, but with the recent moratorium on new data centre development in Singapore the area is gaining potential as a home for workloads that would normally only reside to the south. 

Osaka has enjoyed several new hyperscale developments, as many of the large conglomerates based in the city and across the Kansai region required capacity closer to home than facilities available in Tokyo.

This selection of cities is but a sample of the growing markets regionally and the overall potential of Asia Pacific as a data centre region. As these secondary areas scale from 100 or 200 to a primary market level of 300 or 400 megawatts, other currently tertiary or smaller areas will continue their growth as local data use increases and more organisations move to cloud-based solutions. A positive trend across the continent then, with positive growth across the coming decade. 

For more information around what’s next for data centres across Asia Pacific, visit our data centre update page, which includes our latest report on primary markets around the region.

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