The demand for data centers in Southeast Asia has been growing rapidly in recent years due to the region’s increasing digitalization and the growth of the internet economy. This trend has been fueled by several factors such as the increasing internet penetration, rising demand for cloud computing, expansion of e-commerce, government support, and also its strategic location.
According to Arizton Advisory and Intelligence, the Southeast Asia data center construction market size was valued at USD 2.77 billion in 2022 and is expected to reach USD 3.02 billion by 2028, growing at a CAGR of 1.48%. The market has grown significantly, with a major contribution from countries such as Indonesia, Malaysia, and Thailand.
In 2022, the moratorium on data center construction in Singapore was lifted, with the pilot phase relating to sustainable data center development currently underway. Once this phase is deemed successful, it will result in strong growth in Singapore from 2024. The Southeast Asia data center construction market also is witnessing several telecom operators’ investments to establish edge data center facilities. For instance, DITO Telecommunity, a new entrant in the Philippines telecom space, deployed edge data centers in Iloilo, Roxas, Bulua, Baler, and Ibajay Aklan.
Several countries in the region, such as Indonesia, Malaysia, and Thailand, are offering special lands for industrial corridors to develop industrial properties. Such factors are further expected to escalate the Southeast Asia data center construction market. The rapid growth in colocation demand from major industries such as cloud/IT, government, BFSI, and other enterprises have been a boon for the development of data center construction in the market, along with attracting global hyperscale cloud operators for increasing their presence in the region.
However, as the demand for data storage and processing continues to grow, data centers are becoming more critical to businesses and society at large. This increased demand also brings with it new risks and challenges for data centers.
Cooling in Countries with Tropical Climate
Out of the common data center risks, the environmental risk is the main concern nowadays. Data centers consume a significant amount of energy, contributing to climate change and as Southeast Asia has a tropical climate with high temperatures and humidity, they can be challenging environments for data center cooling.
Brunei, Burma (Myanmar), Cambodia, East Timor, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand, and Vietnam are included in the countries in Southeast Asia with tropical climate.
Cooling is essential for data centers to ensure that the equipment operates at optimal temperatures and avoids overheating, which can lead to system failures and data loss. There are various cooling methods that can be used in data centers, including air conditioning, liquid cooling, and free cooling.
Air conditioning is the most common method used in Southeast Asia, as it is cost-effective and can be easily deployed. However, liquid cooling and free cooling can also be used to reduce energy consumption and increase efficiency.
It is important to note that the type of cooling system used should be carefully chosen based on the specific requirements of the data center and the local climate conditions. Proper planning and design can ensure that data centers in Southeast Asia are able to operate efficiently and effectively.
Shortage of Skilled Workers in Data Centers
Aside from the cooling system, Southeast Asia has been experiencing a shortage of skilled workers in the data center industry. This shortage is due to a few reasons, including lack of education and training programs; lack of awareness; and lack of investment.
The technology industry in general is experiencing a crisis. By 2030, experts predict that the technology sector will experience a labor-skills shortage that will reach 4.3 million workers.
Across the world, tech companies are waking up to this realization, putting time and money into a whole plethora of initiatives designed to help encourage more people to pursue careers in the technology sector and improve the retention rates of those they already employ.
Countries in Southeast Asia are also expected to feel the impact of skilled labor shortage within the next two decades, particularly in the data center industry because there is a lack of education and training programs that specialize in data center technology. As a result, there are not enough trained professionals to meet the demand for skilled workers in the industry.
Additionally, many people in Southeast Asia are not aware of the opportunities available in the data center industry. This lack of awareness makes it difficult to attract new talent to the industry.
There is also a lack of investment in infrastructure and technology in Southeast Asia, which makes it difficult to develop and maintain data centers. This lack of investment also makes it difficult to attract skilled workers to the region.
The demand for skilled workers in the data center industry is high in Southeast Asia due to the growing number of data centers being built in the region. However, there are not enough trained professionals to meet this demand.
Data centers are complex facilities that require a high degree of precision and expertise to operate effectively. A single mistake by a human operator can have significant consequences, such as causing equipment failure, data loss, or even a complete system outage. Hence, human errors can certainly bring data centers down.
To minimize the risk of human error, data center operators must implement strict operational procedures and train staff thoroughly on how to perform their jobs safely and accurately. Additionally, automation and monitoring tools can be used to reduce the need for manual intervention and provide early warning of potential issues.
Overall, the key to avoiding data center risk is to implement a comprehensive risk management strategy that includes redundancy, backups, disaster recovery planning, physical security, and SLAs. By taking these steps, you can help ensure the availability, integrity, and security of your critical data and systems.
