The global surge in cloud computing, big data, online network services, and AI applications has triggered a massive expansion of data centres, with Southeast Asia emerging as a hotspot.
While China leads in data centre infrastructure due to affordable utilities and vast land, Malaysia is now gaining attention as a key regional player.
Strategic advantages such as stable infrastructure, geographical positioning, and growing foreign investment make Malaysia a prime location for hyperscale data centres.
Hyperscale Data Centres in Southeast Asia
Southeast Asia, driven by the increasing need for online services after the COVID-19 pandemic hit, is experiencing a wave of investments in hyperscale data centres.
China’s data centre sector, which had been steadily developing for the past 20 years, also experienced a significant surge during the pandemic due to the demand in online services such as global live media, e-commerce, and online banking, leading to the company’s active promotion of cloud computing and big data.
Currently, major tech companies are turning to Malaysia, Thailand, Indonesia, and the Philippines for expansion due to factors such as lower costs, government incentives, and a young, tech-savvy population.
Malaysia, however, stands out due to the country’s favorable geographic position within the ASEAN region, strong government support, and investor-friendly policies, making it a compelling location for data centre development.
“We are seeing an increasing investment in this hyperscale data centre being announced. Malaysia is right at the hottest location to set up data centres within the ASEAN region.
That’s happening in the developed countries like the US, Japan, Korea, Europe.
We are seeing a new trend which is the AI data centres, which is enabled by NVIDIA’s GPU.
The AI data centre is entering a fast-growing track”, said Kent Seet, Director at JLL Capital Markets data centre.
In particular, Malaysia has become an ideal destination for companies looking to establish a data hub in Asia.
The future of data centres lies in AI. Powered by NVIDIA’s GPU technology, AI data centres are being designed to handle the growing demands of artificial intelligence applications.
In 2023, NVIDIA expressed its willingness to support Malaysia’s AI growth by agreeing to help build a centre of excellence to facilitate AI learning and research, as well as creating Malaysia’s own AI cloud computing system (Source: PMO).
Recently, a collaboration between NVIDIA and YTL Power International was established to enhance Malaysia’s artificial intelligence (AI) infrastructure.
It includes plans for developing a large language model in Bahasa Melayu and bringing the country’s fastest solar-powered supercomputer to the YTL Green Data Center Park in Johor (Source: BERNAMA).
Although China is investing heavily in this field, Malaysia is quickly catching up, with several hyperscale AI data centres launching in the region.
These centres will form the backbone of next-generation AI services across Southeast Asia.
“While it takes around 2 to 3 years to construct a data centre, the impact of AI-enabled centres will be transformative once operational.
After the data centre is built, it may take another half a year or one year to fully operate.
Hence, at this stage, we have not seen a complete AI data centre yet, but we know that there are a number of industrialists who are periodically coming into Malaysia”, said Chan Kee Siak, Founder and CEO of Exabytes Group.
Today, Malaysia is already a destination for data centres and it is on track to lead ASEAN’s AI data revolution.
Conclusion
As the region looks to the future of digital infrastructure, Malaysia’s role as a data centre hub is becoming more evident.
With an influx of investments and the rise of AI data centres, the country is poised to become a critical player in the global data landscape.
The future is bright for Malaysia as it positions itself as the gateway for data services in Southeast Asia.
