Asia Pacific is eyeing billions of dollars’ worth of investments connected to data centers, amid the intense pace of AI adoption in the region.
The Guidepoint Insights Team is closely watching this evolving landscape, gauging demand outlook, identifying key market drivers, and conducting comprehensive market analysis.
Here, we delve into the pivotal data center markets that are being actively observed by our team.
Malaysia’s Promising Data Center Landscape:
Malaysia is poised to emerge as a data center powerhouse in Southeast Asia.
Guidepoint teamed up with seasoned experts including a Director of Strategic Partnerships of Global Data Solutions and a Senior expert of government relationships from Bridge Data Centers to conduct a thorough market scan and assess the demand outlook.
Key takeaway:
“In Johor, the data centers being built are mainly large-scale customized data centers, catering to cloud service providers, international operators, large internet companies, AI model training companies and more.”
“Around 60-70% of the clients in Malaysia are Chinese.”
“Malaysia’s dual center development shows significant differences in scale, speed, customer structure, and development direction.”
“The main issue is the reserve energy. We are not entirely confident yet.”
“The demand will likely remain strong for the next two years. However, beyond that, it may decline significantly.”
Hong Kong Data Center Evolution:
Hong Kong strides toward solidifying its position as a strategic data hub in the region.
Guidepoint Insights recently hosted key discussions with a former account director of EQUINIX and a sales director from GDS to shed light on essential market dynamics, the burgeoning demands from AI, Fintech and cryptocurrency sectors, and the potential implications of geopolitical developments of Hong Kong’s future status.
Key Takeaway:
“The finance customer is the key customer within the data center market. It’s essential to have this core segment in order to maintain a healthy income.”
“New demands are coming from AI, Fintech, Crypto sectors”
“I don’t think the land and the electricity pricing will affect providers in the coming years.”
“As long as the Chinese network security firewall is still in place, Hong Kong will remain an attractive point for overseas players to set up their data port.”
“Hong Kong’s future status may be delicate, as it may serve as a frontline for data exchange or sharing between China and the United States, or between China and other countries.”
Japan Data Centers – A Nexus of Growth and Limits:
Japan has led dealmaking activities in the global data center market this year. In light of the AI-driven trends, what are the expected changes in competitive dynamics and energy supply?
Guidepoint Insights held discussions with the CEO of SpiralGroup and an Executive Consultant from KOCHI to understand the challenges and discover untapped opportunities.
Key takeaway:
“Market players include telecom company like NTT, IT manufacturers like Hitachi, typical power utility companies and foreign companies are looking to build hyperscale data centers.”
“In Japan, energy supply is limited. Electricity shortages will begin.”
“AI service data centers are building capability in rural areas with better renewable energy resources.”
“This multi-availability zone functionality is very popular in Japan.”
“Generative AI needs very big power consumption and cooling capabilities.”
India’s Soaring Trajectory in the Data Center Market
The India data center sector is on an impressive expansion trajectory, booming to drive 10 million sqft in realty demand by 2026.
Guidepoint Insights recently partnered with Chief Digital Officer from Yotta Infratructure to provide pivotal insights into the sector’s explosive growth.
Key takeaway:
“The Indian data center industry is in the explosion stage thanks to favorable government policies including the DPDP Act, streamlined regulatory processes and improved digital infrastructure.”
“Five years back we used to see data center capacity of around 300–400 racks. Today, people are talking about 30,000 racks in a typical data center park.
“AI-driven investment is revolutionizing the market.””
“Data centers like Yotta, are coming up with their own public cloud, which will compete with AWS and other hyperscalers.””
“Mumbai accounts for almost 50% of the new supply followed by Chennai, which is almost 25%. Noida is coming up in a big way.””
Through ongoing pivotal discussions with renowned industry experts across major markets, Guidepoint Insights will continue to monitor the evolving trends in the APAC data center market, providing analysis of the latest technological advancements and their implications, while staying abreast of the breaking market events.
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