Editor’s Question: What industry factors and policy discussions will influence APAC’s data centre infrastructure, resilience and capacity demands in the coming years?

Editor’s Question: What industry factors and policy discussions will influence APAC’s data centre infrastructure, resilience and capacity demands in the coming years?

Founding members from the Asia Pacific Data Centre Association share insights on the key influences shaping the region’s data centre market.

Jeremy Deutsch, President, Equinix Asia-Pacific

Jeremy Deutsch, President, Equinix Asia-Pacific

The APAC region is witnessing a synchronous acceleration in digital infrastructure development, governments are introducing various policies to advance their digital capability and competitiveness.

For example, the Hong Kong Government announced the Hong Kong Innovation and Technology to develop Hong Kong into an international I&T centre. The Malaysian Government also aims to develop its digital economy through the MyDigital initiative. Digital infrastructure is quickly becoming a cornerstone for governments and businesses to achieve a competitive advantage and succeed in an increasingly important digital economy.

In today’s digital economy, volume of data is growing at a staggering rate as data-gathering devices continue to proliferate. To fully leverage the potential of AI, enterprises need to strategically acquire data from reliable sources and utilise appropriate models. The growing enterprise adoption of cloud computing and the focus on Edge Computing and AI to process and analyse data closer to the source will also require increasingly flexible and hybrid approaches to digital infrastructure.

Another trend is the rise of Everything-as-a-Service (XaaS), where on-demand digital services allow businesses to plug and play new digital capabilities at software speed that can be scaled up or down according to their needs. By 2026, IDC predicts that 65% of customers will opt to pay for their IT equipment and services through XaaS models, highlighting the growing popularity of this consumption model.

Growth of digital footprint should not come at a cost to sustainability, illustrated by the numerous technological and social achievements that reflect our steadfast commitment to climate neutrality by

2030. In Southeast Asia, we are making a significant contribution by offering sustainably powered and increasingly climate-neutral data centres, aligning with the governments’ environmental aspirations, for instance, the Singapore Green Plan 2030.

Jonathan King, Group Chief Strategy and Investment Officer, ST Telemedia Global Data Centres

Jonathan King, Group Chief Strategy and Investment Officer, ST Telemedia Global Data Centres

The APAC region is experiencing phenomenal demand for data centre colocation compared to the rest of the world. Between 2023 and 2028, APAC will see the strongest growth at 12.5% CAGR, compared to the Americas with 6.2%. In addition, it is projected that by 2026, APAC will account for half of the global colocation market. In the coming years we expect to see increased interplay between industry and policymaking in the APAC data centre landscape in the following areas:

The escalation in demand for compute capacity and higher rack densities means that sustainability and energy efficiency considerations are weighing heavier than ever on data centre operators. We must continue innovating in measures such as liquid cooling, AI-enabled power management, renewables and sustainable facility design to stay ahead of the curve.

Expect countries to push for greater control over data storage within their borders. While entities operating across multiple geographies and different regulations might face a fragmented market with higher compliance costs, this also opens opportunities to establish local data centres and colocation facilities to help meet local regulations.

The data centre industry needs more skilled engineers and technicians. Policymakers must work with industry to assist in the development of a robust talent pipeline, including policies that attract and retain both local and international expertise. Public-private partnerships must also play a deeper role in cultivating a skilled workforce.

The APAC data centre industry is at a crossroads; success hinges on the ability to navigate policy while driving sustainable innovation. Enterprises that prioritise collaboration and invest in future-proof digital infrastructure and talent will be well-placed to thrive.

Daniel Ong, Director, Solution Architect, Asia Pacific, Digital Realty

Daniel Ong, Director, Solution Architect, Asia Pacific, Digital Realty

The burgeoning enterprise AI market will be one of the biggest drivers of growth and presents a transformative opportunity for the data centre industry in APAC.

However, we believe AI adoption will not be a linear migration. Rather, AI infrastructure will mirror the dynamic evolution of the cloud, evolving from single provider models to the multi-cloud and hybrid cloud architectures dominant today. Increasingly, customers will look to combine private AI infrastructure with access to large public AI models. This allows them to access both public and private data securely for training and customisation, while maintaining control over data for enhanced privacy and security based on specific needs.

Data centres will need to evolve to meet customer demand for robust and adaptable data centre infrastructure that can help them unlock new levels of efficiency and innovation with AI. We see this in three key areas:

  • Open, hybrid architecture: Multi-tenant data centres with enhanced connectivity between facilities offer organisations the flexibility to integrate increasingly complex digital infrastructure deployments. With open and secure platforms, customers have access to a global ecosystem of service providers, allowing them to build and orchestrate their ideal solutions easily and efficiently without the constraints of physical location or closed ecosystems.
  • Modular infrastructure: Prefabricated, scalable solutions eliminate the need for costly, time-consuming overhauls. They enable data centres to seamlessly adapt to escalating AI demands while maintaining peak performance and reducing capital expenditure.
  • Sustainability: AI’s high power and cooling demands require a shift in digital architecture. Modular data centres allow adaptive cooling based on real-time IT equipment heat loads. This efficient power distribution reduces energy waste, offering a sustainable solution to supporting AI advancements.

By embracing hybrid infrastructure models, high-performance connectivity and sustainable solutions, the data centre industry can be the cornerstone for the region’s future AI ecosystem.

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