Data Center Locations: Asia Pacific
Why locate in the Asia Pacific
Strong economic growth in the Asia-Pacific region has drawn attention to the East, where many new data center strategies are being planned today. Kris Kumar, Digital Realty Trust’s regional head for Asia Pacific reveals what the region has to offer
upgrade power and connectivity capabilities to stimulate and support the level of data center construction necessary to sustain the area’s economic ascension. In Singapore, for example, the country’s decision to liberalize its telecommunications marketplace has led to the influx of familiar industry names, including DRT, Equinix and Savvis.
The diverse populations of the APAC region also make it a logical destination for data center development. ABI Research estimates the region will soon become the epicenter for mobile application development and innovation due to its language diversity and long road to market maturity. Technological efforts and their associated advancements in the coming years serve as harbingers for the continuing need for computing capacity within the region.
When asked why he robbed banks, US robber Willie Sutton replied: “Because that’s where the money is”. And this is exactly why companies should be considering locating data center facilities in the Asia-Pacific region. As a result of the globalization of the economic marketplace, the emergence of countries such as China and India and the drive within the region to build state-of-the- art telecommunications infrastructures, APAC will benefit from the organic data center requirements of its local business base and the need for multi-national firms to establish their own computing presences within the region.
Since 2006 capacity within the region’s data centers has risen by an estimated 45%. In a report released in March 2010, the Asia Data Center Alliance highlighted strong growth for the region in 2009, and the same for 2010/2011. It stated that its member companies as a result expected to see an average business growth of 18 to 30% for the year. Some estimates put that growth for third-party providers such as wholesale providers, colocation and managed services firms at in excess of 20% over the next few years, with the bulk of the opportunity coming from the 90% of
data center and server room space that is currently in-housed or in-sourced by the region’s business community. Digital Realty Trust research efforts confirm these estimates, as over 80% of the enterprise (with annual revenues above US$500m) indicate they will definitely or probably expand existing data center facitlities in the next 12 to 24 months.
Asia Pacific growth drivers Long viewed as the sole province of Japan, the economic story of the APAC in recent years has been highlighted by the generalized level of growth across the its largest countries, including not only China and India but also Singapore, Australia and Hong Kong. The Singaporean economy, for example, was estimated to grow by 15% in 2010. This is particularly significant when compared to the sub-3% rate of growth experienced by the US and Europe during the same period. Based on this continued rate of expansion, estimates indicate that APAC could make up as much of 40% of the world’s economy by 2030.
Due to this influx of capital countries such as Singapore, India, Hong Kong, Australia and China have taken dramatic steps to
Futhermore, a lack of existing data center capacity, the rapid growth of cloud-based services is catalyzing the demand for space within APAC.
Adrian Ho of IDC estimates that in Singapore all data centers are full or operating close to full capacity. This lack of space, coupled with the escalating cloud-driven data center demand, will overcome the pariochialism that has defined APAC’s data center environment up to now. Verticals such as the government and financial services have typically opted to own and manage their own facilities but Ho believes this will shift in favour of third-party hosted data centers in years coming years.
The globalized economy in practice The globalization of the world’s economies is undeniable. With the emergence of the Asia Pacific region as a major market entity, computing demands of both local and international firms will only continue to increase. The ability of companies to support the requirements of the market will necessitate data center presence within one or more of the countries that comprise the region. This level of demand and the new infrastructure in the region make it an area for intense consideration for data center development. n
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