Indonesia’s Data Centre plans gets a huge push

The Indonesian data centre market has experienced significant growth over recent years, following an increasing demand for internet and social media.

According to estimates, there are about 29 million new internet users, which has fuelled a boom in the e-commerce sector that has managed to grow by 37 per cent.

Government initiatives are further accelerating the growth for digital infrastructure and greater connectivity across the country. All of which are contributing to a boom in innovative data centre solutions.

These developments have caught the eye of the French government, which, through its finance ministry and banking institutions, plans to provide US$190 million to fund a feasibility study for Indonesia’s national data centre project.

Indonesia’s National Development Planning Agency (Bappenas) has appointed the European country to carry out the study, which is to be conducted by French engineering firm Sofrecom, according to a report by Jakarta Post. The funds would be guaranteed by export credit agency Bpifrance Assurance Export, the report added.

“Today, an important step has been taken, as we have signed a financial protocol that would enable financing and determine the modalities of such financing,” the French Embassy in Indonesia said. The release went on to explain that several French companies had shown interest in participating in an upcoming tender for the study project.

More DCs in the works

Around twenty data centre operators are looking at the possibility of launching operations in a technological park on Indonesia’s Batam island.

Already, a data centre operator has sealed the deal after President Joko Widodo granted the park special economic zone (SEZ) status, according to a report in The Straits Times.

“Most of them were waiting first for the SEZ to happen and started conversations only around the beginning of this year,” Nongsa Digital Park senior executive director Marco Bardelli was quoted.

“We have already signed with one party and I am having dialogues, at different stages, now with 19 different data centre parties,” he added.

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Additionally, the greater Jakarta area is experiencing increasing adoption of cloud-based services, among consumers, businesses and government. Indonesia is also home to some of the fastest-growing start-up companies in South East Asia.

Private players such as Tencent and Princeton Digital Group have outlined their plans for setting up data centres in Indonesia. Recently, Tencent Cloud announced its plans to launch a second Internet Data Centre (IDC) in Indonesia by the end of this year. It had launched its first IDC in April.

In August, Singapore-based Princeton Digital Group (PDG), plans to come up with a greenfield development in Jakarta, as part of its plan to expand its footprint in Indonesia.

The new 22MW data center, to be named Jakarta Cibitung 2 (JC2), is being built within the same 19,550m 2 campus that houses PDG’s existing data center JC1. This expanded campus of 35MW is well-poised to serve global cloud companies, domestic internet companies and enterprises with unmatched scalability, connectivity and reliability.

Indonesia’s data centre market size is expected to grow at a CAGR of 6 per cent from 2020−2026, on the back of increasing usage of tech adoption and government regulations, according to research from Arizton Advisory and Intelligence.

Venkatesh Ganesh

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