Making Asean the next data center hub | Inquirer Opinion
Commentary

Making Asean the next data center hub

/ 05:02 AM November 11, 2022

Fueled by the shift to hybrid working arrangements, businesses have adopted digital and cloud-based applications at an unprecedented rate. Rapid digitalization, alongside the rise of over-the-top services, artificial intelligence, and 5G, has led to an increasing demand for high quality and scalable data centers.

Asean, in particular, has become one of the fastest-growing data center markets today. According to Eco-Business and Digital Realty, the Asia-Pacific colocation data center market will be worth $28 billion by 2024—surpassing North America to become the largest worldwide over the next decade—with Southeast Asia driving much of this growth.

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Asean has seen a boom in the construction of data centers in recent years, with local telcos, data center operators, and hyperscalers building new facilities to support future growth and a latency-free experience. In Indonesia alone, operators like Telkom Indonesia, ST Telemedia, and hyperscalers like Microsoft, have announced plans to build new facilities over the next few years.

Clearly, everyone wants to tap the massive promise presented by the region’s fast-growing tech-savvy population, with 40 million new internet users coming online in Southeast Asia in 2021. In tandem with the 5G rollout, the explosion of internet-based companies, and efforts to strengthen global connectivity, the region holds immense economic potential as a strategic data center hub for Asia-Pacific—and the world.

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But before this can happen, what else needs to be considered?

Charting a sustainable, secure path. Today, business growth needs to take into consideration everything from climate change to cybersecurity. Top of mind is sustainability—specifically, the need for sustainable ways of cooling data centers. Currently, 95 percent of Asean’s data centers use highly inefficient air-based cooling systems, which is especially concerning since cooling makes up more than a third of a data center’s total energy consumption.

Energy-efficient methods present a huge opportunity to offset the carbon footprint of data centers while saving dollars in the process. Newer methods like liquid cooling are particularly suitable for the region’s warmer climate, reducing energy consumption by 20 to 30 percent and water usage by up to 50 percent. Other solutions like solar photovoltaic and green hydrogen are also being adopted by forward-thinking operators.

Operators and regulators alike recognize the need to balance the economic promise of data centers with sustainable growth. Policymakers are stepping in to regulate energy consumption, with Singapore piloting new criteria for new data centers, such as having a minimum power usage effectiveness measure of 1.3.

The same attention is being given data security. With more people going digital, the amount of personal data being stored in the cloud is multiplying exponentially, catching the attention of cybercriminals who have taken to breaching systems to steal important data.

Thankfully, we’ve witnessed a steady buildup of data protection policies to protect national security and economic interests—from country-specific laws like Singapore’s Personal Data Protection Act, to intercountry regulations such as the Singapore-Philippines cooperation pact on personal data protection to further enable trusted cross-border data flows.

For operators, keeping data secure goes beyond just complying with regulations, or problem-solving post-attack. It is often a fundamental consideration from as early as the design phase—making sure the center’s infrastructure is secure, intelligent, and able to prevent attacks before they even take place.

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Laying the right foundation. With multiple considerations to juggle, the region’s data center growth story is clearly not cut and dried. Underscoring these critical challenges is the need for a data center’s underlying network to be reliable, adaptable, and advanced.

New, AI-powered cooling technology to reduce energy consumption can be bandwidth intensive; so are always-on networks to ensure little to no downtime for cybercriminals to exploit. Furthermore, operators constantly have to contend with the increasing demands of a hyperconnected society.

This necessitates AI-driven, energy-efficient data centers that deliver greater computing and storage capabilities—all while keeping information safe, without leaving a massive carbon footprint behind.

Solutions like data center interconnect (DCI) can help make that a reality by enabling resource-sharing across multiple data centers, resulting in more computing power and storage without the need to build more centers. This is especially helpful for some land- or power-limited Asean hubs.

By putting the right building blocks in place and incorporating solutions like DCI, Asean can become a blueprint for other regions to connect the on-demand society of the future.

Getting things in order. Data centers lie at the heart of our digital economy and can unlock huge value for consumers, businesses, and operators alike. But at the heart of every data center, we first need fast, reliable, and adaptable networks. Only then can we address larger and more enduring challenges like sustainability and security to make our vision of Asean as the next global data center hub a reality.

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Dion Leung is regional managing director of Asean, Ciena.

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