Alibaba is set to establish a data center in Vietnam, aligning with local regulations mandating data storage within the country. Currently reliant on government-owned facilities, the move reflects the company’s adaptation to comply with legal requirements.
As per Nikkei Asia, Alibaba currently leases server space from Vietnamese telecommunications giants Viettel and VNPT, illustrating how businesses have adjusted since the implementation of a contentious law in 2022.
Despite opposition from tech giants like Google and Amazon, Vietnam’s data localization policy was enacted towards the end of that year, prompting companies to explore cross-border alternatives.
Dang Minh Tam, Alibaba Cloud’s solution architect lead, revealed that the company employs colocation strategies with the state-owned companies to house client data locally.
Additionally, data backups are stored in Alibaba’s server farms spanning the region, from Taiwan to Singapore. The decision to build a data center in Vietnam stems from the country’s rapid economic growth, according to Tam.
While specifics such as cost and timeline remain undisclosed, the endeavor could surpass $1 billion, reflecting the substantial investment required. Tam emphasized Vietnam’s immense potential as a market ripe for expansion, underscoring Alibaba’s strategic focus on meeting burgeoning demand in one of Asia’s fastest-growing economies.