Exclusive Interview: Singapore Startup, Data Center First, Ventures into Batam, Indonesia

When news of a data center development in Nongsa Digital Park, Batam, was officially announced on July 2021, there were mixed reactions from industry watchers. After all, Batam is not the de-facto data centre investment location in Indonesia. It is Jakarta. 

We looked at Data Center First CEO, Mr Wong Ka Vin’s track record, his value creation (made through early investments in data centres) comes to mind instantly. Right from the way he expanded data centre business for 1-Net to his other previous stints such as Cyber CSF (now NTT Indonesia), Wong Ka Vin has been at the forefront of value creation for his customers and investors. Taking note of this, in July, Data Center First, along with Joint Venture partner, Gaw Capital Partners (GCP) announced their Data Centre deployment platform and appointed him to head the business. 

We sat down with Mr Wong Ka Vin for an exclusive interview to find out the reasons behind choosing Batam, whether the Singapore government’s moratorium prompted the company to set up its maiden venture in Indonesia and other insights. 

When was Data Center First founded?
The team was officially formed in May 2021. Our Joint Venture partner, Gaw Capital Partners (GCP) issued a press release on July 23, 2021 announcing their investment and creation of Data Center First as their Data Centre deployment platform ex-China.

How did the idea of Data Center First come about?
Starting out is never easy, we got this far because we have a clear vision on how to bring our version of the NexGen Data Centre Operations to the market and a core team that has the trust of the market to make this happen. The last piece of that made this story possible came when GCP saw the same vision and made an investment decision to implement the Data Center First vision. Belief in our intentions, Resilience against the opposition and Focus on our customer needs will be the cornerstone of our success.

So far, how has the reaction been?
Many congratulatory messages! But also many questions which when we answered shows the hidden value of NDP in Batam for the Digital Economy of Singapore and Indonesia.

Why did you choose Batam over Jakarta?
Batam is a strategic “digital gateway” for Jakarta to effectively expand its catalystic influence into the Sumatra 3 strategic Cities of Medan, Palembang and Pekan Baru. Batam with its extensive subsea fibre networks connecting itself to Singapore will become the most effective digital business portal for Singapore based businesses to extend its digital footprint into Indonesia. Beside this Batam is sheltered from the seismic fault lines, earthquakes and tsunamis. This means the Indonesian digital industry can now deliver a sustainable business model by leveraging the presence of International Data Centers in NDP like Data Center First’s Nongsa One DC.

Is the moratorium a key decision for Data Center First to start its maiden project outside of Singapore?
No, I believe Batam proposition with Singapore is based on something more fundamental that is related to the shared vision of a Digital Bridge that is aimed at expanding the digital market for both countries. The moratorium is just a catalyst that will accelerate the realisation of this shared success in the digital economy. Data Center First has been working on our Batam plans since 2017.

If the moratorium is lifted, will that be a risk for you if DC builds are approved in Singapore?
No, we do not see a negative impact to our plans in Batam if the moratorium is lifted because even if the moratorium is lifted the Data Centre Industry in Singapore would need to change as we believe new guidelines by the Singapore Government will have operating cost impact especially if the renewable energy adoption cannot be met completely. Data Center First believes that the new eco-systems between DC’s infrastructures in Singapore and those in NDP connected by the extensive fibre networks will offer customers in both the Singapore and Jakarta market new implementation dynamics to work with as they grow their Digital business in both these markets.

Why is the Singapore government supporting the Batam initiative?
We do not have an insights to the both Government thinking beyond the public statements that we see regularly in the press but we believe the NDP initiative in Batam is a win-win situation for both countries. The expansion plans in the Indonesian digital industry will complement the digital industry projected growth in Singapore. Businesses who are looking to expand their digital footprint now has an alternative implementation platform to consider, this is healthy competition which can only expand both the Indonesian and Singapore markets.

Do you consider this project to be high risk especially when Batam is a new market?
Every project has risks, I do not believe the risk in the Batam project will be higher or lower but it will be different from another countries or projects. With risk comes opportunities and that is why the land we acquired gives us the ability to deploy Phase 2 which will enable us to scale the business whilst taking advantage of the common infrastructure like power, network connectivity and customer communities which we created in the Phase 1 project.

Do you expect the pandemic to delay the construction of your facility?
We believe we should not have a delay in terms of constructing the facility as we have put in place some risk mitigating strategy (which we will not be discussing here) but any government intervention due to the pandemic protocol implementation will not be within our control and may have an overall impact on our project schedule. 

Has the Covid-19 pandemic impacted the demand for DC capacity in Jakarta?
We believe the Covid-19 pandemic has not played an influencing role in the demand for DC capacity in Jakarta or Indonesia overall but the pandemic is a wake-up call for businesses and economic policy makers to re-think what is really strategic about each of our businesses and how to rebuild our global supply-chain within this new geo-political-economic reality brought about by the Pandemic.

Who are your target customers and how do you see competition?
For Phase 1 deployment we are focused on delivering colocation services to our target market, which are all the major licensed Telcos (which include mobile players), Business ISPs, eCommerce, Mobile & Internet Banking Services and local Cloud Operators.

We see the data centre market not in a competition framework but more in a co-opetition framework, this will give the customers’ choice in pricing, growth and choice of location because the data centre market co-exist with the network market. This means, depending on the business situations and timing we could either be co-operating and/or competing with our competitors for the business.

Is there enough head room for competition in the data centre space? How are you different from your competitors?
There are 2 ways that Data Center First is different from most of our competitors; firstly we believe that the difference lies in the fact that we must not be afraid to change how we operate hence the term NexGen Data Centre Operations and secondly we see changes in the customers’ needs of the data centre facilities that they are buying and thirdly staying focused and learning to share the business pie with your customer community who will be doing business with each other at the DC.

What are your hiring plans?
We have a Core Management team of 6 persons currently, CEO, Head of Engineering, CIO (Chief Investment Officer), CTO, SVPs for Finance and Corporate Services. With the exception of our SVP Corp Services, the other members have been with me for the past 20+years starting with me in my early days in Equinix. We are all hardened professionals in the DC business but what sets them apart is their passion in the business and belief that the only certainty this Industry presents is constant change.

Are you looking to increase your headcount?
Yes, we will be growing our team in the early part of 2022 in conjunction with our expanding business plan execution around the region.

Data center entrepreneurship isn’t entirely new. Other data center entrepreneurs from Asia Pacific include Robin Khuda from Airtrunk, Rangu Salgame from Princeton Digital Group and Charles Lee from One Asia Network etc.

What’s Next? W.Media’s first documentary series “Inside Asia – Future of Data Centers” will be released in December 2021!

Join W.Media’s Singapore Cloud and Datacenter Convention 2021 & Asia Pacific Awards Ceremony and Gala at Marina Bay Sands on 1st December 2021 to find out the latest issues and innovation that concerns your digital infrastructure.

Vincent Liew

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