How Singapore faces a DC talent crunch

When it comes to business, Singapore has emerged as one of the premier destinations and is an economic powerhouse in the world. The nation also has a robust data center market with many regional and global players, and the only mature data center market in South-east Asia, research by Cushman & Wakefield shows.

Predicted to grow at a compounded annual growth rate (CAGR) of 12 per cent from 2019-2024, Singapore can continue to leverage the twin strengths of its mature local market and the emerging regional markets to navigate the next wave of data centre development.

However, there is a catch.

Just like many other data centre operators in the world, companies in Singapore have been having a hard time hiring high-demand roles such as technicians and analysts of power systems, control specialists of facilities, robotics technologists, amongst other factors.

Singapore’s information communications technology (ICT) sector currently employs about 200,000 people, and will require another 60,000 in the next three years, according to Vivian Balakrishnan, the Minister in charge of the national Smart Nation Initiative.

Yet, the education system is only producing 2,800 ICT graduates annually, which is 8,400 graduates over three years, leaving a 51,600 shortage. Edward van Leent, Chairman and CEO of UK-based energy consultancy EPI Group, at W.Media’s Digital Week in South East Asia 2021 points out something interesting. “There is a lot of churn in this segment as the work is demanding and people have to work on holidays. People tend to leave jobs after a few years and move into other industries.”

In order to improve Singapore’s profile as a preferred data centre host, it has to build up its manpower pool to meet the industry needs.

Skill requirements

The industry is seeing a mix of talent shortage as well as high attrition, which does not augur well. “What I am seeing practically is that you can get people, but to get the right skill sets, it is a problem,” opines van Leent. A specialised mix of skills are required for success in the data center industry.

First, infrastructure skills, such as first-hand mechanical or electrical equipment expertise are required.

It is also extremely important to have basic technology skills, such as programming and skill set with specific technology platforms and tools.

In addition, data centres need specialists with problem-solving abilities and the determination to practice them, the ability to think critically, a mission-driven emphasis on business objectives, and excellent customer support and teamwork ability. It’s a diverse applicant profile that has made it tougher than ever to fill today’s data centre positions.

What is causing the staffing shortage?

There are several causes of staffing shortages, ranging from attitudes and awareness to policies and new developments.

Firstly, there is a lack of awareness of DC as a possible career track for prospective engineers and knowledge of what to expedite identification of system problems. Adding to that, there are insufficient data-centre focused courses at institutes of higher learning (IHL).

As many locals shy away from jobs in data centres, there is a growing need for foreigners to fill up the positions, especially the entry-level jobs.

However, the Singapore government has taken steps to promote local hiring, one of which includes the recent increase in the minimum salary requirement for foreign workers. Thus, it is hard for foreigners with entry-level experience to get an Employment Pass.

With the growing sophistication of data centers, the industry’s focus has shifted from facilitation and operation to cloud ecosystem. This has increased the need for employers with the necessary specialized knowledge in ICT.

What exacerbates the demand for data center talents is a recent rise in uptake of hybrid cloud by Singapore businesses, outpacing the global average, Nutanix’s research showed.

The same study reported a slightly higher percentage of respondents in Singapore said that their IT department lacked skills for managing hybrid cloud environments (42%) than the global average (37%).

The Fix

The quick fix for the lack of awareness may not hard to come by in the short term. However, with the world’s data skyrocketing (growing at an average of 63% per month), it will only be a matter of time before data center careers begin to take the centerstage of public attentions.

More collaborations and information sharing between firms and schools. An example of such collaborations is the Work-Study Diploma in Data Center Infrastructure & Operation, an Institute of Technical Education (ITE) course that combines learning with practical experience. It would be more beneficial if educational policies institutionalize this exchange and expand it to other IHLs.

In fact, many of the skills can be learned on the job. Most jobs do not require a high level of formal education to carry out the role, even in positions where the employer may have initially required it. In other words, relevant experience, an internship/traineeship, or on-the-job training can often more than compensate for the lack of a formal qualification in most data center job roles.

Professional training of the existing employers will be crucial to keeping up with the changing requirements. Smaller operators may not have the capacity to train their engineers like their larger counterparts. Often, they pay a premium to hire experience data center operators. However, as the industry gradually evolves, what remains will be the larger players, who can afford to train their employers professionally.

Succession training is also critical to maintaining an adequate workforce at all levels of experience and forces the staffing discussion. It enables organizations to transition smoothly in the wake of retirements or other changes in leadership and helps them focus on the relatively new staffing challenge.

Even then, high staff turnover rates at the data center industry may defeat the benefits of training.

There are always fewer elements of uncertainty when we rely more on machines. Automation can reduce the stress on manpower. For example, Datacenter information/infrastructure Management (DCIM) software can expedite the identification of system problems.

According to Uptime institute’s research, 34% of data center operators believe that artificial intelligence will reduce their staffing levels in the next five years, and 43% think that it will take longer.

Uncertainties remain

Other solutions for the staffing challenges continue to dog the sector. Hiring overseas talents to address local shortage is an increasingly acceptable possibility, especially given the ongoing pandemic.

While remote management is a prominent shift in the data center industry, many other complexities related to remote hiring such as legal and tax issues will come hand-in-hand, points out van Leent.

It is also hard to predict how much additional manpower is required for new technology, such as Edge computing.

This is due to the fact that Edge computing will rely heavily on prefabricated data centre designs and will make considerable use of remote monitoring/operations, the staff requirement will likely be both lower than and different from those for centralized data centres, making it hard to predict in the near future, according to Uptime Institute.

Perhaps, all this could push up the need for automation in the sector.

How does Singapore’s Data Center Market impact the larger economy?

It is no secret that Singapore is the leading data center market in Southeast Asia, and one of the primary markets in the wider Asia Pacific region — decades of easy access and business-friendly policies have propelled the tiny city state into a meeting point for multinational tech corporations, and that includes some of the industry’s largest data center operators and investors.

So, what is the one largest impact of the data center industry on Singapore’s already bustling economy?

Ajay Sunder, Deputy Director of Strategy at SC-Nex, believes that it is the continued exemplary governance that Singapore takes around data protection and privacy that will make the country a leader in the region. As the volume of data grows, so does the need for stronger policies that guarantee data security. In this, therefore, Singapore can serve as a model for its neighbouring economies, thereby solidifying its position as the data hub of Southeast Asia.

On the other hand, Patrick McCreery, Head of Commercial at Keppel Data Centers, points out that the biggest impact of the data center industry on Singapore’s economy is added capability to develop next-generation technologies.

Data centers are directly tied to the digital ecosystem and infrastructure of a region, and Singapore already has the best conditions for a thriving tech hub. As such, it produces a synergic effect: 5G, AI, and Internet of Things (IoT) can thus be accelerated at greater speed.

Smart City initiatives and data centers

The capability of a data center is closely tied to the success of a smart city, and here is where the presence of data centers has the potential to influence the development of other sectors around it.

Mr. Sundar highlights how the data center industry cuts across the world’s six core sectors — metals, minerals, infrastructure, logistics, digital media, and real estate — making it one that is unique and thus charged with potential. Building a smart city requires a high level of skill in the core sectors, and a talented labour force. If a market has a large pool of talent in the above sectors, we will be able to see considerable growth.

Long story short, a data center enables the economy around it, and in this case, Singapore serves as a shining example.

Singapore’s short and long term challenges

However, this does not mean that Singapore’s data center market is without its challenges. Daryl Dunbar, a Singapore-based tech strategy leader and independent consultant, says that so far, much of next-generation tech skills are still constrained to the US and Western European market. This means that migration of such skills is one challenge that lays ahead if an economy such as Singapore wants to grow bigger.

“There needs to be a localisation of tech skills to allow for further growth,” he said.

Another challenge is sustainability. It is reported that data centers in Singapore consume about 20 percent more energy compared to the global average. Therefore, operators inevitably have to evaluate and improve on energy efficiency for data centers.

According to Mr. Sundar, questions that data center companies should address when going green, include: who their energy partner is, and how energy efficiency can be guaranteed.

“These will determine how operators will be perceived in the industry in the long run,” he added.

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Microsoft to launch first DC region in Indonesia

Microsoft has established its first data centre region in Indonesia.

This, the Tedmond-based tech major has done as part of its Berdayakan Ekonomi Digital Indonesia initiative.

The initiative is seen by Microsoft as a commitment to advancing growth and digital transformation for Indonesia, its developer and startup ecosystem, enterprises and the public sector. The establishment of this data centre is expected to generate investments will up to $6.3 billion for Indonesia and add about 60,000 jobs to the local economy.

The initiative is a collaboration with four universities and the Ministry of Communications and Information. It will also see Microsoft skill an additional 3 million Indonesians to achieve its goal of reaching over 24 million locals by the end of 2021, through its skills programs that are focused on cloud, cybersecurity, and AI.

“Microsoft’s investment to establish local data centres, digital skilling, and collaboration with the Government of Indonesia will support local innovation, economic recovery, and digital transformation,” Indonesia’s Minister of Communication and Information Johnny G Plate said.

“The Ministry of Communication and Information welcomes Microsoft’s plans to establish a local data centre region with highly secure and compliant cloud services, which will benefit local businesses, government, and individuals across all sectors.

“We also welcome Microsoft’s commitment to increase the capacity of Indonesian digital talent across all skill levels.”

Microsoft has over 60 data centre regions, globally. The Indonesian facility will feature Azure Availability Zones, which are unique physical locations equipped with independent power, network, and cooling. It will also support the company’s sustainability goals, including its commitment to shift to 100% supply of renewable energy in Microsoft data centres by 2025.

Microsoft has around 150 employees and 7,000 partners across Indonesia’s 17,000 islands.

Samsung begins mass production of SSDs for hyperscale data centers

Tech conglomerate Samsung has announced that it has begun mass production of its most advanced line of data center chips.

Dubbed the PM9A3, the SSD is built with the company’s sixth-generation V-NAND memory technology, a cell layer stacking method that increases the volume of data a chip is capable of carrying. PM9A3 has a sequential write speed of 3000MB/s, a 40 percent higher random read speed of 750,000 IOPS and a 150 percent higher random write speed of 160,000 IOPS.

Input/output per second (IOPS) is the measurement unit for how fast SSDs and hard drives are able to read and process data.

In terms of write speed, the chip is also 50 percent more energy efficient compared to its predecessors at 283MB/s per watt, making it highly suitable for modern data center facilities that place emphasis on green, renewable sources.

Why are SSDs so important?

SSDs form the core of a high capacity data center. Exponential cloud and 5G growth on a global scale means a demand for more data centers due to a need to store higher volumes of data, and this means a need for more powerful SSDs.

“Wider 5G deployment and accelerating growth in IoT devices are fuelling a hyperconnected lifestyle, driving the demand for more sophisticated hyperscale data centers,” said Cheolmin Park, Vice President of Memory Product Planning at Samsung.

“Providing an optimal mix of performance, power, reliability and firmware, we believe our new PM9A3 will help advance today’s data center storage technologies and expand the market for OCP-compliant SSDs.” he added.

On top of that, the PM9A3 is equipped with security features including user data encryption and authentication, and secure boot and anti-rollback mechanisms to block out unauthorised malware and ensure robust data protection.

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Pre IPO, Malaysia’s Bank Islam accelerates digital transformation

Bank Islam, which is set to become the first publicly listed Islamic Bank in Malaysia, before its IPO, has decided to accelerate its digital transformation efforts with local telco, TM One.

Both organisations have signed a Memorandum of Understanding (MoU) which will see TM One deploy digital solutions in cloud, big data analytics, cybersecurity, and data centers to optimise the bank’s operations.

Muazzam Mohamed, CEO of Bank Islam, said that the partnership with TM One will improve the bank’s functions and services to its customers, which are important parts of the business especially ahead of its listing.

“These solutions will intensify BIMB’s information technology (IT) infrastructure and centre for digital experience (CDX) digital banking products, by allowing new buying experience, away from the traditional banking approach,” he added.

On being selected as Bank Islam’s preferred digital partner, Ahmad Taufek, Executive Vice President and CEO of TM One, said that the company is honoured to be given the opportunity to extend its digital expertise to Bank Islam. “We are fully aware that digital transformation, data security and protection are the top priorities, especially for the banking sector,”

“This befits our role as part of TM Group, as the enabler of ‘Digital Malaysia’,” he continued. With a rapid increase in tech adoption post-COVID, countries such as Malaysia Digital Economy Corporation (MDEC), the country is looking to establish itself as a digital hub in the region.

KT partners with South Korea’s Land & Housing Corporation to build data centers overseas

KT Corporation (KT), South Korea’s largest telecommunications company, has announced a partnership with the country’s Land and Housing Corporation (LH) to build internet data centers overseas.

In a Memorandum of Understanding (MoU) signed by both parties, KT will be installing data centers in LH’s overseas industrial facilities and offer digital transformation services to both South Korean and foreign companies.

On the other hand, KT’s Head of Global Business, Moon Sung-wook, revealed that LH will help companies in overseas industrial complexes innovate by using KT’s digital platform capabilities.

“We will develop specific digital transformation strategies according to each market, contributing to the vitalisation of industrial complexes overseas,” he added.

South Korea sets its eyes on data centers

South Korea is the latest up-and-coming player in the data center industry, with homegrown tech giants forming partnerships with both the South Korean government and foreign tech firms to grab a bigger share of not only the data center market, but also the global chipmaking market, which is integral to powering data centers.

Seoul, the capital city of the East Asian Tiger economy was also recently named as a ‘Market to Watch’ for having a 300 megawatt (MW) data center capacity.

With the world’s fastest Internet speeds, significant government investment into ICT infrastructure, and a large talent pool, South Korea is quickly gaining recognition as one of the best places in Asia to build data centers.

LH’s Head of Global Business, Lee Yong-sam, said that he hopes the collaboration will create a synergy in developing new cities and industrial complexes.

“We plan on expanding cooperation with related firms abroad to help Korean companies’ entry into foreign markets,” he continued.

KT currently owns and operates 13 data centers in South Korea, including Seoul’s largest hyperscale data center in Yongsan which opened in November 2020.

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IBM to go carbon neutral by 2030

After the landmark EU Green Data Center Deal last week, IBM is the next tech giant to make a carbon neutrality pledge.

The veteran tech company announced its plans to achieve net zero greenhouse gas emissions 2030 to combat climate change.

CEO Arvind Krishna said that he is “proud” that IBM is leading the way to significantly reduce carbon emissions, and that this decision will put the company “years ahead” of the targets set out in the Paris Agreement.

IBM has laid out three short and long-term goals to achieve its ambition.

First, the company aims to reduce greenhouse gas emissions by 65 percent by 2025. This figure will be measured against the base year 2010. Next, it will set out to make 75 percent of its electricity consumption renewable by 2025, and 90% by 2030.

Last but not least, IBM also plans to utilise “feasible technologies”, such as carbon capture, to remove emissions in an amount which equals or exceeds the level of IBM’s residual emissions.

What is the EU Green Data Center Deal?

Introduced in late January, the EU’s Green Data Center Deal saw over 40 tech organisations, including Amazon and Google, come together to pledge to go carbon neutral by 2030. This deal was part of the EU’s 2019 Green Deal which aims to make Europe the world’s first climate neutral region by 2050.

IBM’s latest pledge will be carried out in more than 175 countries where it operates, and this may very well include its offices and facilities in Europe as well as China, where President Xi Jinping has also pledged to slash carbon emissions by at least half by 2030.

This also means that if all goes according to plan, IBM will achieve carbon neutrality ten years ahead of its rival Amazon.

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Report: Sydney, Singapore among the world’s biggest data center markets

Sydney and Singapore are among the world’s biggest data center markets.

These findings are according to real estate services company Cushman and Wakefield, which has published its latest report on the global data center market, ranking the world’s best cities for data center facilities in terms of land considerations, ecosystem advantages, and political and regulatory circumstances.

However, the top ten data centre markets are dominated by the US, with Northern Virginia and Chicago ranking first and second in the world respectively. Dallas, Seattle, and New York are other major cities made the list.

Two Asia-Pacific cities made the top ten: Sydney placed third, right in front of Silicon Valley, whereas Singapore came in at fifth place. As the biggest mover in overall rankings, the report attributed Sydney’s leap to third place to “Australia’s ongoing transformation in IT infrastructure”.

Singapore’s position, on the other hand, illustrates the city state’s “strong existing [market], dense fiber, and an array of available services.”

The report also shed light on secondary data center markets where the colocation sector “continues to blossom”, this includes Seoul, which entered the long list for the first time with a 300 MW data center capacity, Jakarta, and Mumbai. Data center markets to watch in APAC include Kuala Lumpur and Chennai.

The report evaluated 1,189 data centers and 48 markets all around the world.

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Equinix plans to develop a $91 million DC in Sydney

Equinix plans to develop a $91 million data centre in central Sydney.

The New York-listed company has submitted its plans, which include a facility, to be built across a 26,000 sq m site at 506 Gardeners Road in Alexandria. This was submitted to the Council earlier this week, the company said.

Equinix plans to provide up to 15,500 sq. metre of new rack space and offices in a new stand alone facility that will link directly with the first stage of its 9,220 cabinet SY5 centre and its existing SY4 centre on Bourke Street.

It will also benefit from direct fibre connect capability between its neighbouring IBX data centres SY1, SY2 and SY3. It will also connect with a new data centre, the SY6 IBX, in Silverwater, Western Sydney.

The new facility will give its users secure connections to more than 1,800 participants across all regions around the world, linking them to major cloud providers such as Alibaba, Amazon AWS, Google Cloud, Microsoft Azure, SAP Cloud, Oracle, and SoftLayer.

With this Equinix’s national footprint will go up to 19 data centres across Sydney, Melbourne, Perth, Canberra, Adelaide and Brisbane.

Globally, Equinix comprises more than 200 data centres across 26 countries, providing data centre and related services for 10,000 businesses, which includes more than 50 per cent of the Fortune 500 companies.

Perth has been highlighted by Equinix as a strategic location due its proximity to two 4,600 kilometre submarine cables linking to Singapore—the Australia Singapore Cable and Indigo cable.

In Perth, Equinix recently announced plans to develop a $76 million data centre, the third such facility. That first phase of that facility, to be located adjacent to its existing PE2 centre, will offer an initial capacity of 650 cabinets and a collocation space of more than 1,830 sq. metre by the end of this year.

When fully built, the facility will offer 1650 cabinets and a collocation space of more than 10,600 square metres. A day back, ExtraHop, a cybersecurity firm that specialises in cloud-native network detection and response, opened data centre facilities in Sydney to enhance access to its native security platform, Reveal(x) 360. 

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Hiranandani Group to develop a DC park in West Bengal

India’s real estate company Hiranandani Group, has entered into a Memorandum of Understanding (MoU) in the state of West Bengal to set up an industrial, logistics and hyper-scale data centre park in the region.

The combined investment by the group and their customers is estimated to be in the region of Rs 10,000 crore. Hiranandani Group has signed an MoU with Hindustan Motors to acquire a 100-acre land at Uttarpara, Kolkata, to set up an integrated logistics and hyper-scale data centre park by Hiranandani Group companies GreenBase and Yotta respectively, the company said in a statement.

The first phase of the industrial and logistics park will be up and running by June 2022 and the first data centre building will be ready by June 2023, the company said.

GreenBase will deliver 3 million sq feet of industrial and warehousing space along with essential utilities and support infrastructure built to international standards. Greenbase has a pan India presence providing industrial, logistics and warehousing solutions to clients.

A Joint Venture (JV) of the Hiranandani Group with global private equity firm Blackstone, Greenbase is developing industrial and logistics parks across Mumbai MMR region, Pune, Nashik, Chennai and Bengaluru and has plans to deliver 15 million sqft of space across the country in the next five years, having an investment outlay of $500 million.

Yotta, Hiranandani’s hyper-scale data centre division, will see a development of 6 hyperconnected data centre buildings bringing in 250MW of cutting edge data centre capacity over the next several years to the state. In 2020, Yotta inaugurated its Asia’s largest and World’s second-largest Uptime Institute Tier IV certified data centre in Navi Mumbai. It most recently announced its Greater Noida data centre park and Chennai data centre park.

“Kicking off this project would not have been possible without the tremendous support of the Government of West Bengal under the leadership of chief minister Mamta Banerjee. West Bengal is the gateway to the east. It is an ideal hub for logistics and industrial development with excellent road, rail and riverine connectivity,” said Darshan Hiranandani, Group CEO, Hiranandani Group.

Simultaneously, the data centre business will benefit from the digitization revolution, the upcoming Silicon Valley at New Town at Rajarhat and excellent fibre connectivity on land and the new submarine cable coming up at Tajpur. “By setting up a data centre park in Kolkata, we will not only serve the customers of the state but the entire eastern region including neighbouring countries,” he said.

The data centre industry is expected to add 703 MW capacity by the end of 2025, translating into an opportunity of 9.3 million sq ft of real estate development, according to a report by JLL.

 

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Report: Worldwide IT Spending to grow 6.2 percent in 2021

As the world continues to accelerate digital transformation at breakneck speed, worldwide spending on IT infrastructure is expected to grow by 6.2 percent this year.

Market research firm Gartner Inc.’s latest report in its 4Q20 Market Databook revealed that despite the availability of COVID-19 vaccines, the pandemic will continue to spur significant IT spending in 2021 up until 2022.

“With the economy returning to a level of certainty, companies are investing in IT in a manner consistent with their expectations for growth, not their current revenue levels. Digital business, led by projects with a short Time to Value, will get more money and board level attention going into 2021,” revealed John-David Lovelock, Distinguished Research Vice President at Gartner.

Among the top five IT segments researched, enterprise software and IT devices will see the highest growth in 2021 with spendings increased by 8.8 percent and 8 percent respectively. Data center systems came in third, with a 6.2 percent increase in spending.

Overall, the total IT spending for 2021 is projected to reach $3.9 trillion.

High spending in the devices market can be attributed to remote education and remote work from students and employees, which pushed the demand for tablets and laptops. Global IT spending for remote work, therefore, will reach $332.9 billion in 2021, a 4.9 percent increase from 2020.

Mr. Lovelock also added that digital business will remain the dominant technology trend in late 2020 and 2021, with areas such as cloud computing, core business applications, security and customer experience at the forefront.

“Optimisation initiatives, such as hyperautomation, will continue and the focus of these projects will remain on returning cash and eliminating work from processes, not just tasks,” he added.

The APAC data center market outlook 2021-2026: Report

Reportlinker.com announced the release of the report “APAC Data Center Market – Industry Outlook and Forecast 2021-2026”.

The APAC data center market share has been witnessing exceptional growth since the outbreak of the COVID-19 pandemic, which has increased the access to internet-related services aided by lockdowns and restrictions imposed by government agencies across the region.

The APAC data center market by revenue is expected to grow at a CAGR of approximate 6% during the period 2021–2026.

Colocation service providers witnessed a strong uptake of data center spaces by existing customers owing to the growth in demand during the pandemic.

Due to the emergence of a new business environment, cloud service providers and video conferencing service providers have significantly contributed toward colocation and data center services, the report found.

COVID-19 impacts vary

In Japan, the data center construction witnessed no impact due to the pandemic, however, data center operators implemented stringent precautionary regulations for the safety of their employees.

Similarly, in India, a country-wide lockdown lasted for around 60 days with a majority of operations performed via online and remote mediums, which increased internet users by 25%. Hence, the market witnessed a strong spike in the announcement of new projects across India, China, Malaysia, and Japan in Q3 2020.

Growth factors

The report identified the following factors are likely to contribute to the growth of the APAC data center market during the forecast period:

• Implementation of 5G Network triggering Edge Data Center Investments

• Procurement of Renewable Energy

• Installation of Innovative Data Center Technology

• Artificial Intelligence Enhances Liquid Immersion & Direct-to-Chip Cooling Adoption

Demand for computing infrastructure increased

The demand for high-performance computing infrastructure is increasing due to the adoption of IoT, artificial intelligence, and big data analytics in China and Hong Kong. The adoption of blade type servers is set to grow in China and Hong Kong. Over 90% of data centers in China have adopted blade servers for the high-density computing environment. The demand for supercomputers is also increasing with the adoption of digital currency in these countries.

The IT infrastructure spending in Australia will be dominated by cloud-service providers, followed by enterprises, involving self-managed IT infrastructure solutions. Over 50% of the business IT budget is spent on the migration to cloud-based services in Australia, with IaaS spending leading the chart.

In India, a rise in the cloud, big data, IoT, and artificial intelligence technology by enterprises is a major driver for the IT infrastructure market. Around 70% of start-ups in India are adopting IoT technology, with healthcare and manufacturing segments attracting the highest investment.

The demand for modular data center facilities deployed in Southeast Asian countries is high. The procurement of lithium-ion UPS is expected to grow in the region to avoid high OPEX on VRLA systems. The data center development is likely to be of higher capacity, typically over 5 MW, requiring the adoption of 2N redundant backup systems owing to challenges related to power fluctuations and outages.

In China and Hong Kong, a majority of data centers adopt a combination of air and water-based cooling techniques to cool down facilities. However, a few facilities are built to support free cooling techniques. Data centers in India mainly use air-based and few facilities operate using water-based cooling systems. However, data centers are not completely suitable for free cooling. Few states in the country support free cooling of up to 1,000 hours annually.

High air pollution levels in major cities across India could make free cooling an unfeasible option for operators. Most high-density environments are likely to consider water-based cooling systems, while small-scale deployments could operate through air-based cooling systems in the country. A majority of data centers in Singapore are designed to adopt water-based cooling techniques. The growth of data center construction market in APAC will aid in the development of facilities that would comprise multiple chillers, cooling towers, and CRAH units with N+N redundant configuration.

China led greenfield constructions; Malaysia expected to see more new projects

In terms of general construction, China leads greenfield construction. Hong Kong is expected to witness largely brownfield developments due to the space shortage during the forecast period. A majority of the construction contractors are located in these markets. Whereas in India, the increased interest to improve efficiency and reduce OPEX is driving data center operators to procure intelligent DCIM solutions for end-to-end monitoring of facilities.

Most data centers developed in Malaysia during the forecast period are expected to be greenfield. The market also has a strong potential for growth among modular data center projects. The labor cost in Malaysia is cheaper than in Singapore. However, the availability of a skilled workforce will be a major challenge among providers.

More high-tiered projects in the works

In the APAC region, several under-developed projects fall under the Tier III category, and the trend is expected to continue during the forecast period, with several operators likely to shift to the Tier IV category.

Higher tier means that the data center is capable of providing a higher level of service.These metrics of level include redundant electrical path for power, uptime guarantee, cooling capacity, and concurrent maintainability, to name a few.

In terms of colocation, these facilities will cost higher per rack basis than Tier I and Tier II facilities. Most new data centers are designed as Tier III standards with a minimum of N+1 redundancy. Tier IV data centers are equipped with minimum 2N+1 redundancy in every infrastructure that makes the facility fault-tolerant, with some facilities having 2N+2 redundancy of infrastructures such as UPS systems and PDUs.

Mega-projects in China & Hong Kong data center markets are designed to be of Tier III and Tier IV standards, which are leading to a high deployment of 2N redundant UPS systems. Multiple data center facilities with a power capacity of more than 10 MW are implemented in Australia, which is increasing the adoption of over 500 kVA capacity UPS systems. DRUPS systems are majorly adopted in the country.

Facebook, Apple, Microsoft, and Google are the major contributors to Tier IV data centers. These facilities generate more revenue for the APAC data center market, with focused investment on highly efficient cooling systems.

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Chindata establishes two new subsidiaries in two days

Chindata Group, a leading carrier-neutral hyperscale data center solution provider in Asia-Pacific emerging markets established two new subsidiaries within two days: Chindustry, to create more value for digital leaders; Chinpower, to contribute to a greener hyperscale data center industry.

Chindustry’s predecessor is the Group’s Project Delivery BU, which has the successful development and construction experience in planning, designing and building the next-generation hyperscale computing infrastructure.

The Group expects it to provide customized, cost-effective and full-stack solutions for its customers, adapting to global tech giants’ diverse needs.

Chinpower aims to develop a brand-new energy solution for the hyperscale data center industry, the Group released.

These new subsidiaries come after the Group raised $540 million in a U.S. initial public offering priced at the top of a marketed range and climbed 20% in its trading debut in October last year, Chindata Group after raising, according to statistics by Bloomberg.

Globally, investors are eyeing cloud computing service providers, necessary for employees working from home, Bloomberg reported.

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China Mobile International opens data center in Frankfurt

China Mobile International (CMI) has opened a new data center facility in Frankfurt, Germany.

CMI’s second data center in Europe, the new Tier-III facility will connect with CMI’s data centers in the UK and Singapore, and its Global Network Center in Hong Kong.

CMI is a subsidiary of Chinese state-owned telecommunications provider China Mobile.

Dr. Li Feng, Chairman and CEO of CMI, said that the company’s decision to place its data center in Frankfurt, the financial hub of the European Union (EU), is informed by their goal to provide secure and reliable high-speed connectivity between Europe and Asia.

“Technology is now an intrinsic part of almost all aspects of our lives, so more data needs to be processed and stored. This in turn means greater demand for cloud and content delivery solutions,” he continued.

“CMI provides professional one-stop-shop services to help carrier and enterprise customers respond to and meet the needs of their users in a new era of digital globalisation,” Dr. Li added.

This new data center has more than 80 Cloud Connect points of presence (POPs), a nine-layer security control system, and supported by a dual power supply from two different power substations. Its cooling system runs on a chilled water storage facility, the company said.

Founded in 2008, China Mobile International currently has a presence in over 37 countries, and is involved in developing and offering next generation technologies including cloud, IT, and Internet of Things (IoT) technology.

How Data Centers in China Are Heading Towards Carbon Neutrality

After Chinese President Xi Jinping pledged that by 2030 China would cut emissions per unit of GDP by “at least” 65 percent compared with 2005 levels at the virtual Climate Ambition Summit, China has sped up its decarbonization and development of a low carbon economy.

The announcement was met with a mixed response with some environmental observers questioning whether China can go this far.

“The most challenging part of the shift is not the investment or magnitude of renewable capacity additions but the social transition that comes with it,” said Wood Mackenzie analyst Prakash Sharma.

In China, representing the information backbone of an increasingly digitalized society, data centers are still a net producer of Greenhouse Gas (GHG) emissions and major electrical power users. Research from Greenpeace and North China Electric Power University estimated that China’s data center consumed 161 billion kilowatt hours of electricity in 2018, equivalent to 2 percent of the country’s total usage. The power consumption is projected to grow 66 percent by 2023, to 267 billion kilowatt hours, which means 163 million tonnes of carbon emissions are produced assuming China’s energy mix remains the same.

Tier-I cities in China such as Beijing, Shanghai and Shenzhen have applied strict PUE rules as a method to push the industry towards greener operations. While Beijing has implemented a complete citywide ban on new data center construction, Shanghai only allows new data center with a PUE of 1.3 or below and refitted ones with a PUE of 1.4 or below. Meanwhile in Shenzhen, data centers with a PUE of over 1.4 receive no subsidies and those with less than 1.25 could obtain a subsidy of over 40 percent. Besides, central government policy on more use of renewable energy remains one of guidance and encouragement. China manufactures around 70 percent of solar energy equipment such as PV panels and modules.

Renewed Renewable Energy push

Different from traditional infrastructure like roads and railways, construction of “new infrastructure” in China is boosted to remain the primary driver of energy consumption in the foreseeable future. With data centers rapidly expanding and depleting environmental resources, the energy and climate impacts are being one of top considerations in China, as well as the world in general.

Intensive energy use can be costly both in terms of the data center’s operating budget (often representing more than 50 percent of the budget) and the impact on the environment.

Interest in renewable energy in China has been growing for several years, and leading Chinese companies have already undertaken the exploration of renewable energy use.

Research from Greenpeace and North China Electric Power University also states that China is outpacing the US in renewable energy, and has made huge progress in developing solar and wind projects.

However, nearly three quarters of (data centers’) power comes from coal, said Ye Ruiqi, a climate expert from Greenpeace. “To prevent this, China’s data centers need to decouple their electricity consumption from their carbon footprint by relying more on wind and solar energy. They can build their own renewable energy capacity, buy clean energy on the market or purchase green certificates to offset their emissions,” she added.

A Turning Point

In the backdrop of all this, China’s proposal to achieve net zero emissions by 2060 aims can be seen as a turning point. To fulfill the goal of carbon reduction and pollution prevention, China’s tech giants, state-owned energy companies and other important players are encouraged to make great efforts, from advancing technologies that produce less greenhouse gases or air pollution, accelerating energy transition and taking more social responsibilities.

In December 2020, China Three Gorges Corporation, a Chinese state-owned power company operating the China Yangtze Three Gorges Project (one of the biggest hydropower-complex projects in the world), announced plans to construct its Dongyue Temple Data Center. It is planned to build about 28,000 cabinets and invest 5.5 billion CNY (around $855.8 million). In Stage I, about 4,400 cabinets will be put into use by October, 2021, with an investment of 830 million CNY (around $ 129 million).

Responding to Chinese government’s pledge of “carbon neutrality” and the scheme of “New Infrastructure”, the group will further utilize the advantages of clean energy, stock land and real estate to promote the big data industry. Although it has been involved in the big data industry since 2017, it is the first time that the group announces its ambition to expand business with such massive spending on the ICT market.

Chinese private enterprises seem to have got off the block. On January 12, Chinese internet giant Tencent released its plan of achieving zero carbon emissions with the help of technology. With this announcement, Tencent became one of the first Internet companies to take action in achieving carbon neutrality.

“As China announces its carbon peak and carbon neutrality targets, Tencent will also accelerate its carbon neutrality plan. At the same time, we will also increase the exploration of the potential of cutting-edge technologies represented by artificial intelligence in coping with the major challenges of the earth, and make great strides to promote the application of technology in industrial energy conservation and emission reduction,” said Tencent’s founder Ma Huateng (also known as Pony Ma).

Chindata Group, a leading carrier-neutral hyperscale data center solution provider in China, also releases its roadmap to be carbon neutral for all its next-generation hyperscale data centers in China with its 100% renewable energy solution by 2030.

As China becomes a more developed economy, accelerated efforts of decarbonization to accelerate technology innovation and industrial upgrading are made. China’s transition to a low carbon economy is not only possible but can be a driver of high-quality growth while bolstering the development of digital transformation.

How Far Behind

Since 2018, institutions globally are moving towards achieving carbon neutrality, even as concerns have been raised at the way in which this is computed.

Although more Governments and businesses are committing to achieve carbon neutrality by 2050, the world is still falling far short of that goal, UN Secretary-General António Guterres said in November in his latest push for a cleaner, greener future. Guterres reported that so far, the European Union, Japan and the Republic of Korea, along with more than 110 other countries, have made the pledge, while China is set to join them by 2060. “The window of opportunity is closing,” he warned.

In January, following the inauguration, President Biden signed an executive order at the White House, to reverse the previous administration’s withdrawal from the 2015 accord, which returned the United States to the worldwide fight to slow global warming and reduce greenhouse gas emissions. Alongside China, the United States is the world’s most carbon emitter.

Financial institutions have been accused of funding “dirty capital” into traditional power projects. All this is changing.

Goldman Sachs has ruled out direct finance for new or expanding thermal coal mines and coal-fired power plant projects worldwide, as well as direct finance for new Arctic oil exploration and production.

The policy makes a clear mention of protecting the Arctic National Wildlife Refuge,

Goldman Sachs said in a statement. Further, the bank has also committed to a phase out of financing for significant thermal coal mining companies that do not have a diversification strategy. Goldman Sachs’s new policy tightens the screw on thermal coal by including underwriting, and explicitly committing to phase-out, not just reduction.

This is a crucial step forward, as other US bank coal finance restrictions have geographic loopholes, industry watchers said.

While other major banks have committed to reducing credit exposure to coal mining, their approach restricts only lending, ignoring the large amounts of capital the banks facilitate for the coal industry from the underwriting of issuances of stocks and bonds. Activists have been vehement in their criticism of global financial institutions, which they say are turning a blind eye and undermining the Paris Agreement when it comes to phasing out coal-based energy production. Other financial institutions have followed suit too.

Jason Opeña Disterhoft, Climate and Energy Senior Campaigner at Rainforest Action Network (RAN), said that Goldman Sachs’s updated policy shows that U.S. banks can draw red lines on oil and gas, and now other major U.S. banks, especially JPMorgan Chase – the world’s worst banker of fossil fuels by a wide margin – must improve on what Goldman has done.

“The writing was already on the wall for coal financing. Goldman Sachs’s new policy puts that writing in flashing neon,” he added.

According to research by non-profit organisations like Urgewald, BankTrack and 30 others, banks and other financial institutions from January 2017 to September 2019, they have provided lending finance and underwriting services to 258 coal plant developers in the world. According to Heffa Schuecking, director of Urgewald, this has amounted to channeling $745 billion.

Countries like India have also committed to reduce energy emissions intensity by 30 – 35 percent from 2005 levels by 2030 and increase the share of non-fossil fuel energy to 40 percent of India’s energy mix by 2030.

Internationally, there is broad recognition of the need to reduce power use and emissions. This motivates greater efforts in developing future policies, and changes in regulation, taxation and electricity market. In the changing global landscape, data center, an increasingly critical part of the infrastructure for the digitalised society, have outsized importance in climate change mitigation efforts. This is the time when this industry needs to take responsibility and look at sustainability beyond lip service.

For more insights on China, do check out our digital event China Datacenter Market Insights happening on March 5!

Exclusive Insight into Hong Kong’s Datacenter Market: 2021 and Beyond

Hong Kong’s well-established financial and logistics industries are critical components that support the surrounding economy on both a city-wide and regional scale. Its excellent ICT networks position Hong Kong at a crucial juncture between Asia Pacific and the rest of the world, and it is a proven early adopter of technologies like 5G and GBPS Broadband. 

But underpinning these fast-moving businesses and systems are Hong Kong’s datacenters, a robust backbone to Hong Kong’s expansive digital infrastructure.  The digital transformation opportunities enabled by these datacenters is forecasted to add US$9 billion to Hong Kong’s GDP in the next three years–a year on year increase of 0.5 percent.

It’s important to look at the future of the Hong Kong market with a special focus on the heart of its data ecosystem: the data centers themselves. Our upcoming webinar “Hong Kong Datacenters: Market Insights 2021” will provide an unrivalled look into this dynamic market. 

Alex Perkins, Chief Development Officer for Status Data Centers and one of the featured panelists for the show, states:

“Hong Kong is one of the key established data centre markets in Asia Pacific, thriving on the excellent telecommunications networks linking Asia Pacific with the globe.  Being at the forefront of mobile networks connectivity with 5G mobile networks and Gbps broadband as a standard, HK has always been an early adopter of new technologies.”

Upon further reflection of this market,  Perkins went on to highlight the COVID-19 pandemic as a key accelerating factor. Hong Kong companies increased their rate of adoption of cloud computing platforms by 40 percent. In this same time frame, the Media and Entertainment data share has skyrocketed, with social media usage and gaming each up by around 35 percent and video streaming up by 50 percent.

This data boom is most acutely felt in the retail sphere, with e-commerce replacing brick-and-mortar spaces, and Hong Kongers quickly catching up to their mainland counterparts in China when it comes to digital wallet adoption.

 

How does this impact the Datacenter market?

These compounding factors have dramatically driven up demand for datacenters all over the world. In Hong Kong in particular, internet usage has increased 60 percent in the past twelve months. As Perkins explains:

“This has led to limited available capacity in the existing market, especially for larger demand of 2-5MW where options are limited, although major new projects coming to the market from 2021 should alleviate some of those issues.”

Regarding the scope and scale of these “major new projects”, Perkins admits that “Whether this satiates the need for the hyperscale players remains to be seen”, although he notes that “larger sites in TKO and Shatin may do that, however the price point will be key to attracting the big players for the longer term.”

Ultimately, Perkins notes, “The market is looking up.”

 

Learn More

W.Media’s “Hong Kong Datacenters: Market Insights 2021” series will focus on HK’s datacenter market: its business prospects, technological breakthroughs, and future trends. Registration is free. Our speakers will be discussing the commercial real estate outlook, cloud adoption in SME’s, and strengthening the market’s resilience.

Join us on Wednesday, 3rd February from 10.00am – 11.30 am for 90 minutes of invigorating conversation with Alex Perkins as well as other esteemed experts.

Huawei expands cloud presence in Latin America with new data center

Huawei has activated a second data center in Brazil, the AZ2, mainly as a backup center for cloud services offered from its other facility in the country.

Besides providing greater capacity, the redundancy facility is expected to attract customers concerned with the migration of critical workloads to the cloud, the company said in a statement.

“There is still a concern in the market that the service might occasionally falter, and this prevents companies from migrating their critical applications to the cloud. AZ2 brings more stability and increases the network’s delivery capacity in Brazil,” José Nilo (pictured), VP of cloud at Huawei Brasil, said in the release.

This is not Huawei’s first cloud presence in Latin America. Its cloud business arrived in Latin America in August 2019 with the activation of a datacenter in Chile, followed by data centers in Brazil, Mexico, Argentina and Peru.

In addition to the new facility Brazil, a second data center in Chile is expected to come online in coming weeks.

In a roadmap presentation last year, Duan Bin, director of Huawei Cloud LATAM, said the company has plans to reach all of Latin America, including Bolivia, Paraguay, Uruguay, Central America, and the Caribbean in 2021 and beyond.

The expansion in the region and concentration on cloud services can be seen as the company’s strategic move following international sanctions and resistance to its other businesses, TechWire Asia reported.

The manufacturer has faced hostility and suspicion from governments in the West following the Sino-US trade war, allegations of espionage, and alleged violation of trade sanctions. As a result, Australia and Czech Republic are just some of the countries that have banned the use of Huawei’s networks.

However, Latin America has been relatively friendly to Huawei’s technology. Besides the opening of several new data centers, it was reported this month that Brazil’s government will not seek to bar Huawei from upcoming 5G network auctions later this year. In addition, the company has secured major telecommunications contracts for the development of a 5G network, Latin America Tech reported.

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Hyperscale data centers doubled from 2015-2020: Synergy

The total number of large data centers operated by hyperscale providers increased to 541 at the end of the second quarter of 2020, more than double the mid-2015 count, according to analysis by Synergy Research Group, a leading market research firm for the networking and telecoms industry.

Hyperscale, in the data center industry parlance, refers to fitting more IT equipment in less space. Over the past couple of decades, servers have become more powerful and data center designers have a better ability to maximize the amount of servers that are in a data center.

While the US still accounts for almost 40 per cent of the major cloud and internet data center sites from 2015 to 2020, the EMEA and Asia-Pac regions witnessed the highest growth rates, with China, Japan, Australia, India and Singapore among the ten most popular locations globally.

From the second quarter of 2019 to the second quarter of 2020, new data centers were opened in 15 different countries, with the US, South Korea, Switzerland, Italy, South Africa and Bahrain having the largest number of additions.

Among the hyperscale operators, Amazon and Google opened the most new data centers in the last twelve months, accounting for over half of the total, with Microsoft and Oracle being the next most active companies.

Synergy research shows that over 70 per cent of all hyperscale data centers are located in facilities that are leased from data center operators or are owned by partners of the hyperscale operators.

John Dinsdale, a Chief Analyst at Synergy Research Group, said: “COVID-19 has caused some logistical issues but these are robust numbers, demonstrating the underlying strength of the services that are driving these investments. We have visibility of a further 176 data centers that are at various stages of planning or building, which is good news for data center hardware vendors and wholesale data center operators.”

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Amazon, Google among 40 organisations sign European Climate Neutral Data Center Pact

Some of the largest data center players in Europe have come together to create a Climate Neutral Data Center Pact that will make data centers in the region climate neutral by 2030.

In this Self Regulatory Initiative to achieve five data compute and storage objectives, as part of the climate neutrality pledge, 25 cloud and data center operators and 17 associations have come together.

They have agreed to address issues such as power efficiency, water efficiency, 100 per cent carbon-free energy, reusing and repairing servers, and recycling heat produced by data centers. The development assumes significance as many of the European companies have large technology footprint in the APAC region.

This Pact comes a year after the EU’s introduction of the 2019 Green Deal which urged for the industry to go climate neutral as part of its aim to make Europe the world’s first climate neutral continent by 2050. Companies joining the Pact represent the most significant industry players in cloud infrastructure and data centres in Europe.

Big names that have signed the Pact include Amazon, Google, Equinix, and NTT.

Frans Timmermans, European Commission Executive Vice-President for the European Green Deal, said: “Citizens across Europe use ever more technology to go about their daily lives and want this technology also to help secure a sustainable future for people and planet. Today’s pledge from important parts of the data industry constitutes a promise to society and offers a welcome first step towards achieving our common ambitions for a smart and sustainable future.”

Trade associations that have signed the Pact include the European Data Center Association (EUDCA), global cloud computing organisation Cloud 28+, and data center organisations from Poland, Denmark, and France.

“Data centers are the supporting pillars of the fourth industrial revolution and, as seen during the COVID-19 pandemic, are essential infrastructure of not only the digital economy but of the entire global economy,” said Apostolos Kakkos, Chairman of the EUDCA.

“It is our duty to commit to a self-regulatory initiative that will help to ensure the operational availability, sustainability and the future of our industry,” he continued.

Alban Schmutz, Chairman of CISPE (Cloud Infrastructure Services Providers in Europe) was of the view that with cloud infrastructure the backbone of the European Union’s digital economy, the industry is committed to the idea that we must all play a central role in addressing climate change.

This commitment underpins a roadmap for Europe’s cloud infrastructure industry to offer climate neutral services to customers by 2030, he said.

Panopto opens new office in Singapore

Cloud-based video platform Panopto has opened its new office in Singapore as part of its strategy to respond to the growth in demand in Asia.

Located in mixed-use development building Marina One, Panopto’s new base in Singapore will allow the company to continue serving higher education institutions and businesses in over 14 countries in Asia.

“It’s appropriate to ring in the new year in Asia with a new office in Singapore,” said Elle Hosek, General Manager of Panopto Asia.

“Panopto has been servicing customers in Asia on its Singapore-based cloud since 2018, and we’re excited to expand our presence,” she added.

The new office also builds upon Panopto’s data center in Singapore and further complements the company’s existing office in Hong Kong. With Panopto’s presence in Singapore, top local universities including the National University of Singapore (NUS) and the Singapore University of Social Sciences (SUSS) will be able to benefit from a series of cloud-based upgrades, such as seamless online learning.

Why the Transformation of State-owned Chinese Companies Will Take Time

China’s ‘new infrastructure’ plan has become a buzzword for attracting more players and investments. Even as plans are afoot to attract new companies, traditional state-owned companies, more popularly known as Public Sector Enterprises (PSEs), are also keen to expand their role, so that they can catch up with the wave.

Since China’s reform and opening-up of the economy, CCP (Chinese Communist Party) has been striving to gradually allow the markets to play a decisive role in resource allocation, the situation in China’s state-owned companies is much more complex. Some big state-owned enterprises are entering the ICT market or considering to enter the market but things are not going well. Case in point – the acquisition of Global Switch by a Chinese consortium led by Chinese steel maker, Jiangsu Sha Steel Group.

Traditional Industry Faces Challenges

In the 2019 annual competitiveness ranking by World Steel Dynamics, five Chinese steel companies were among the top 50 companies.

The top Chinese steel maker is China Baowu’s Baoshan Iron and Steel Co Ltd (Bao Steel) which was ranked at No 15. It was followed by China Steel in Taiwan at 22, Anshan Iron and Steel Group Co Ltd (An Steel) at 24, Maanshan Iron and Steel Co Ltd (Ma’gang/ Ma Steel) at 31, and Jiangsu Shagang Co Ltd (Sha’gang/ Sha Steel) at 34.

As a key fundamental industry of the national economy, the steel industry, like other traditional industries, is facing challenges such as overcapacity, cost reduction, efficiency increase, energy conservation and emission reduction. Digitalization is the only way for the transformation and upgrade of the steel industry.

Bao Steel, the leader, is the first to have led the consolidation in the Chinese steel sector in the last decade, and has consistently expanded output through several mergers and acquisitions. In August 2000, Baosteel established a subsidiary called Bsteel which is fully owned by Baosteel to delegate its own e-business implementation and maintenance to a separate business unit. At the end of 2006, Bsteel transferred its ICT coding and development business to a similar company fully owned by Baosteel: Baosight (/Bao’Xin Soft). Baosight focuses on Baosteel’s internal ICT platform, ERP, production specific applications, ICT infrastructure operations and user support activities.

Now, Baosight has a bunch of data center facilities. Backed by the Baosteel group, Baosight enjoys significantly resources and cost discount, benefitting by the parent company’s extensive networks and partnerships. From October 2013, Baosight has completed the construction of Baozhiyun Phase I/II/III IDC project through a series of equity financing and self-financing in Baoshan District, Shanghai. The largest data center industrial base in Shanghai focuses mainly in wholesale business and then service outsourcing business (including maintenance and repair of information system, rail transit vehicle system control components, cloud computing operation service, IDC operation service) with an industrial scale of nearly 20,000 cabinets in 2018. The operating income has reached 1.29 billion Yuan at that time. In 2019, the fourth phase of Baozhiyun plans to add 9,000 cabinets so that the four phases of Baozhiyun reached total 27,500 cabinets. Besides, in 2019, the Wuhan Iron and Steel Big Data Industrial Park is set to be built with 18,000 cabinets in the following two years (Phase I: 2216 cabinets in 2019).

State-owned companies in steel industry has boosted a lot of initiatives to heighten its corporate competitiveness in the age of ‘big data’, steer its business direction to meet the market demands for information, and optimize the synergy between the traditional industry of steel manufacturing and the new industry of information technology. Despite the success of the transformation of Bao Steel, the other four Chinese steel giants are not going well when exploring new business.

Being a well-established enterprise in the steel manufacturing industry, Shagang (Sha Steel) has also committed to a business diversification to data and information technology since 2017. It became the controlling shareholder of Global Switch in 2019. Recently, the owners of Global Switch are exploring a sale that could value the London-based data center operator at 8 billion pounds ($10.9 billion) or more.

Challenges and Dilemma

From the time Deng Xiaoping unleashed market reforms in an effort to increase investments in China, the onus was always on the government to whole heartedly lead the investment symphony. The scenario continues till this date. Recently, China has begun rolling out its ‘new infrastructure’ campaign all around the nation, which provides an opportunity for all market players. Compared with the traditional infrastructure, the main force for the investment of the ‘new infrastructure’ are market players instead of the government. Favorable policies have been issued not only for domestic investors but also for foreign ones.

Now, China is working on expanding and opening up policies to foreign investment, even more.

Under the ‘New Infrastructure’ push, it seems that the strengths of state-owned companies are weakened (although still have great advantages especially in resources) and they are brought to the same starting point in the race with other players. The difference is that they have their own responsibilities and path to step forward.

‘New infrastructure’ is not a strong stimulus, but a new economic growth engine for China in the future, which also serves as the most active and productive driver that is full of opportunities for productivity factor optimization and potential improvement. As the new infrastructure is closely connected with the development of new technology, all state-owned enterprises need to achieve their industrial upgrading before they explore new fields.

Besides, in terms of investment, it involves new form to attract public investments. In the process of promoting the ‘new infrastructure construction’, more attention will be paid to explore the innovation of investment and financing mechanism, so as to further stimulate the enthusiasm of private investment, foreseeably through Real Estate Investment Trusts or REITs.

Over years of development, the marginal utility and earnings of the traditional infrastructure decreases progressively. The ‘new infrastructure’, backed by technological innovation, will create jobs and increase earnings in a short period, and facilitate structural transformation and upgrading, thereby bringing along a sound economic development in the mid-and-long term.

Although the role of State-owned companies has been proved to be important in this economy as they have traditionally assisted the government in reforms, they face the challenges they never met before. Not to mention the state is encouraged to divest from other industries by decreasing its ownership.

With the geopolitical situation entering another new normal with the election of Joe Biden and the US President and a pandemic that still continues to hover, investment flows in the future will strongly depend on how age-old enterprises adapt in the post-COVID world. The sooner State enterprises realise this fact, the better.

For more insights on China, do check out our digital event China Datacenter Market Insights happening on March 5!

AT TOKYO to open new data center in 2023

Japanese data center company AT TOKYO announced the launch of a new data center in Tokyo which will commence operations in 2023.

 Named Chuo Center #3 (CC3), the data center will be located within Tokyo’s 23 Wards, special municipalities that are at the center of Tokyo’s Metropolitan area. The facility will be approximately 32,000 square meters with five server room floors.

Upon completion, this new urban-type data center will provide businesses in Japan with added value and boost their infrastructure transformation in Japan’s highly digitalised society.

Construction is expected to complete in September 2023, and operation inauguration is expected to be in October 2023.

Japanese data center market: one of Asia’s most valuable

The data center market in Japan is one of the largest in the Asia Pacific region, and according to advisory and intelligence firm Arizton, it is likely to continue growing at a CAGR of over 3% from 2020-2025.

As of 2020, the Japanese cloud services market is estimated to value at around $6 billion. Japan’s long-standing reputation as one of Asia’s main financial hubs means significant investments from the biggest colocation service providers, including AT TOKYO, NTT, and Equinix.

With the country currently still battling COVID-19, digitalisation in Japan has become more crucial than ever. In February 2020, the Japanese government appointed the services of cloud computing giant AWS to build a government cloud infrastructure for human resource and document management.

AT TOKYO currently has six data centers across Japan, with two in Osaka and four in Tokyo.

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The past year has seen incredible leaps forward in our embrace of digital solutions, and we think it’s time to come together and talk about it. We’re bringing together thousands of IT leaders from across Southeast Asia, covering everything from datacenter deployment to digital banking. Digital Week lets you expand your network and engage with new markets from wherever you are.

Want to learn more about ASEAN’s Cloud & IT ecosystem? Start your year off right and Register Today for Free!

Oz Def Min to exit Global Switch data centre biz by 2025

The Department of Defence in Australia has reneged on its planned 2020 exit from Global Switch’s Sydney-based data centre by up to five years after plans to move all of its data from the facility fell short last year. 

The department extended its deal with the Chinese-owned facility under a $53.5 million contract last October

Defence had planned to shift all of its secret files back into a government-owned data centre at the end of its 10-year lease agreement Global Switch in September 2020, as revealed by the ABC.

The decision to leave was prompted by a purchase of half of the centre’s parent company by a Chinese consortium in 2017, despite assurances from the company that its files are secure. 

The move was slated to cost up to $200 million when planning began around three years ago.

But the new property lease gives Defence access to Global Switch’s Ultimo facility until September 2025.

Meanwhile, other federal government agencies, including he Australian Taxation Office and, more recently, the Australian Securities and Investments Commission, have either moved – or are in the process of moving – out of Global Switch by 2022.

Australian Defence has also extended a separate property lease with Global Switch until September 2025 under an existing deal at a cost of $8 million.

A spokesperson told iTnews “the size of the Defence holdings made it impractical to migrate all the holdings from the data centre prior to the expiry of the Defence lease in September 2020”.

The department did, however, migrate some of its data holdings to an undisclosed “alternative data centre”.

“This was completed in mid-2020,” the spokesperson said, adding that “Defence has developed a plan to migrate its remaining holdings to cover the next three to five years, as supported by the government”.

Defence also uses other data centres, including Canberra Data Centres (CDC) for its billion-dollar enterprise resources planning (ERP) modernisation hosted on Microsoft Azure.

Asked whether sensitive data was stored at the data centre, Defence said it still “has data holdings at GSU [Global Switch Ultimo]”, adding that the facility is subject to Foreign Investment Review Board controls.

Last month, the Australian Strategic Policy Institute found that over half of all current federal government contracts were with one data centre provider, widely understood to be CDC, iTNews reported. 

“Contracts with the dominant provider totalled $620 million, or 79 percent,” it said in its ‘devolved data centre decision report’ [pdf] after analysing 87 current data centre contracts on AusTender.

Founded in 1998 and led by Chief Executive Officer John Corcoran, Global Switch, owns, operates and develops data centers in Europe and Asia Pacific. The company’s footprint currently spans about 390,000 square meters and its tenants include government organizations, mobile carriers and financial institutions, its website shows. The company posted revenue of about 439 million pounds in 2019, its annual report showed.

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HGC brings hyperscale fiber optic network to data center in Hong Kong

Internet service provider HGC Global Communications (HGC) has announced that its hyperscale-focused fiber optic network is now available at AirTrunk’s latest hyperscale data center in Hong Kong.

Also based in Hong Kong, HGC will see its fiber optic network link said data center to not only other data centers in the island, but also to others in the Asia Pacific region.

The data center in question is owned and operated by Sydney data center company AirTrunk. Named HKG1, the facility opened its doors in December 2020 near Tsuen Wan, an important hub for international connectivity in Hong Kong.

“With state-of-the-art network infrastructure, far-reaching connectivity and software-based capability, HGC is well positioned to capture widespread market opportunities arising in the digital economy,” said Thomas Lee, Assistant Vice President of Global Carrier Data, International Business at HGC.

Hong Kong’s data center market to grow bigger

The availability of HGC’s high-speed network to AirTrunk’s data center illustrates Hong Kong’s status as a global financial and technology hub. Cloud and data center consulting firm Structure Research estimates that the Hong Kong data center market will reach a value of $1.7 billion by 2023.

A new data center is coming to Noida, India

India’s city of Noida will see the development of a greenfield data center campus in the near future.

Singaporean data center group, ST Telemedia Global Data Centers (STT GDC), is backing the project. The proposed data center campus will cost an estimated Rs 600 crore, and will have a critical IT capacity of 18 Megawatts (MW) in its first phase.

As for the second phase of the investment, Alok Kumar, Chief Secretary of IT and Industrial Development at STT GDC in India added that a land parcel of around three acres has been identified by the investor, which means that IT capacity would be increased to 36 MW in phase two. This will be an additional estimated investment of Rs 500 crore.

“In view of the web-based and digitally driven economy gaining prominence, the state government is preparing a new data center policy with the objective of creating state-of-the-art data and IT ecosystem to meet the requirements of industry, enterprises and citizens,” Mr. Kumar added.

STT GDC’s presence is good news for both Singapore and India

A subsidiary of Singapore’s state-owned investment management firm Temasek Holdings, STT GDC has been expanding its footprint in India for several years. In 2016, the company acquired a 74% stake in Indian telco Tata Communications to grow its data center business in both India and Singapore.

This new data center campus is in line with the Uttar Pradesh government’s program to promote digital economy growth, said Uttar Pradesh Chief Minister Dinesh Sharma.

Upon completion, the data center will cost a total of Rs 1,100 crore and is expected to provide nearly 80 direct job opportunities and around 1,000 indirect employment opportunities.

These initiatives are part of STT GDC’s expansion plans. Recently, it entered into  a strategic partnership with Hyosung Heavy Industries as it forayed into the South Korean market. This partnership is through a joint venture, where 60 percent of the data center partnership will be held by STT GDC and the remaining 40 percent will be held by Hyosung Heavy Industries.

Netskope expands security cloud services in Singapore data centers

US-based Netskope has announced the expansion of its security cloud services to data centers in Singapore. 

As part of the company’s efforts to grow its investments in the region, Netskope’s flagship private security cloud network, Netskope NewEdge, will be available to its customers in Singapore.

This means that some of Netskope’s most well-known clients in Singapore will be able to enjoy a range of cloud-based cybersecurity services. They include Trustwave, the cybersecurity arm of Singapore’s national telecom Singtel.

Tony Burnside, Vice President for Netskope Asia Pacific, comments that the company’s move shows that Netskope is a “champion for the modern workforce”. 

“With this NewEdge expansion to Singapore, Netskope is enabling organisations to securely scale their businesses without sacrificing speed or performance,” he added.

Improved performance cloud security services by Netskope NewEdge also means smoother operations for data centers not only in Singapore but also surrounding Southeast Asian countries including Malaysia, Indonesia, Thailand, and the Philippines.

According to a survey by cybersecurity company Palo Alto Networks Indonesia, Southeast Asian countries are becoming more aware of the importance of cybersecurity and protection from cyber threats.

Surung Sinamo, Country Manager of Palo Alto Networks Indonesia who conducted the report, said that 400 leaders of tech companies from Indonesia, the Philippines, Thailand, and Singapore are becoming more aware of the importance of preventing and thwarting cyber attacks that can potentially disrupt businesses, as we have seen in the last few years.

Spike in remote work postings since Covid-19: LinkedIn says

During the pandemic, Asia-pacific regions saw a spike in remote work job postings, according to data from LinkedIn.
Linkedin’s statistics show that both remote work postings and applications have increased significantly in 2020. From March to May 2020 alone, India’s remote job applications grew to a multiple of 4.65 times, closely followed by Australia and China, outperforming the global average with an increase of only 2.28 times.
Indirectly, this is expected to drive demand for robust cloud-based platforms and AI-driven cybersecurity solutions. The steady increase of cloud solutions provides employers and employees with access to data and collaborative platforms regardless of their physical locations.
The increasing availability of fast, steady and reliable broadband connection and cloud computing, lay the infrastructural groundwork for remote working, reported Statista, a German company specializing in market and consumer data.
Cloud-based service providers meeting the growing demand

With the demand for remote work expected to be outlasting the pandemic, Statista forecasts that spending on cloud-based business applications, collaboration tools, cybersecurity, and remotely managed IT services are projected to grow by almost 100 billion U.S. dollars over the next few years; on the other hand, spending for on-premises service is predicted to stagnate.

Growing hand in hand is the revenue from the cloud email and collaboration market, which is set to double in size and worth by 2024 from 2020.

Data centers are crucial to the virtual workplace as the key point of access for data and assets, utilized by remote workers when they log in to the network. Thus, how streamlined and secure the process is will determine the experience of a virtual working arrangement.

Leading cloud solutions businesses are ramping up their data center capacity to meet the demand. For example, Zoom Video Communications, Inc. also expanded its co-located data center in Singapore, where it has already had a presence for 2 years.

AppDynamics, part of Cisco Systems, which focuses on managing performance and availability of applications across cloud computing environments and inside the data center, recently started to offer its Software-as-a-Service (SaaS) offering in Asia.

This enables customers to access AppDynamics solutions via a local cloud location and accelerate their digital transformations.

How China’s Data Center Industry is Likely to Shape Up in 2021

The year 2021 could be termed as a “Year of Renewal”. The world is still in chaos with continuing uncertainties, while at the same time rapidly accelerating and transforming.

As a distinct growth pole of global economy, China’s rapid recovery from the Covid-19 has been commendable. Since the last two decades, it has benefited from fast economic growth, and the country has stood out in the developing world for its unique strengths in its market size, diversity and vitality.

Moreover, with the renewed emphasis on infrastructure in its Five-Year Plan and long-term strategy as well as the new policies boosted to empower the digital economy, new infrastructure development and significant increase in demand for data center is being seen on the ground. Case in point- the undersea data center in Zhuhai.

New Infrastructure Push

Fueled by a surge in demand for local demand for digitalization of business and consumer environment, the construction of new infrastructure including 5G and data centers has developed into a strategy, which enables it to meet the twin urgent goals of increasing employment and preparing for new changes in the global economy.

At the 2020 National People’s Congress, the CCP first emphasizes a digital infrastructure public spending programme. Now, building ‘new infrastructure’ has already become a top development priority for China. Since the Covid-19 outbreak, China has witnessed the potential of cutting-edge technologies like artificial intelligence, big data, and cloud computing.

Several tech giants in China have announced plans to scale up their data centers. Following China’s ‘new infrastructure’ initiative, Chinese internet giant Tencent revealed its $70 billion investment on key sectors over the next five years towards making advances in cloud computing and artificial intelligence (AI) while Chinese e-commerce behemoth Alibaba announced to invest $28.7 billion into its cloud and data center infrastructure over the next three years. Also, Baidu, the leading search engine in China, has planned to set up 5 million servers in the next 10 years.

Real Estate Investment Trusts (REITS) it is!

The National Development and Reform Commission of the People’s Republic of China (NDRC) and the China Securities Regulatory Commission (CSRC) jointly issued the ‘Notice Concerning Work in Relation to Advancing Infrastructure Real Estate Investment Trust Trials’ in April, with an aim to channelise personal savings and private capital into infrastructure projects.

Then in August, NDRC announced that it had recently issued the ‘Notice Concerning Effectively Performing Infrastructure REIT Trial Project Application Work’, which indicates that the Chinese government will give priority to “national key strategic” infrastructure projects when receiving applications for REIT trials, as well as “encourage the undertaking of trials for new forms of infrastructure.”

The Notice further indicates that “national key strategic” infrastructure projects will include those associated with regional development plans for the Beijing–Tianjin–Hebei (Jing-Jin-Ji) area, Xiong’an New Area in Hebei province, the Yangtze River Delta, the Greater Bay Area, and the Hainan Free Trade Port.

As per this new initiative, China expedites infrastructure REITs so that fresh capital could be converted into investment capital in the long term while reducing leverage. Dozens of companies have begun preparing for launching publicly tradable REITs since the trial released. However, the applications are still under consideration as the requirements are very strict.

In the next three to five years, such products are likely to provide about 6 trillion Yuan (around $900 billion) in financial support for China’s infrastructure construction, thus further improving the speed and efficiency of China’s infrastructure build out.

New Area

This is closely linked to new development and is being framed in new ways. ‘New Area’ has rocketed to ubiquity, especially when we consider the site selection. Government influence may steer investors’ location preferences here in China.

To promote urbanization and industrialization, and now digitalization, many new areas and zones have been established to concentrate investments and the labor force as well as resources within designated region with more flexible management systems.

For example, Xiong’an New Area, in Hebei province, was announced to be a National New Area as the “Millennium Plan, National Event” by the State Council and the Central Committee of the Communist Party of China. It has become the third new special zone with “national significance” after Shenzhen SEZ and Shanghai Pudong New Area while the other two have already driven the rapid development of the Pearl River Delta and Yangtze River Delta respectively. Xiong’an New Area connects the Silk Road Economic Belt and the 21st-century Maritime Silk Road with the Guangdong–Hong Kong–Macao Greater Bay Area, so as to drive the development of the Beijing–Tianjin–Hebei economic triangle in Northern China.

Currently, China is speeding up its digital transformation of economy with a plan to build industrial ‘big data’ centers nationwide, enabling massive amounts of information to be used for developing more efficient industries. Supported by government, construction of data center is boosted in these regions such as the Beijing–Tianjin–Hebei (Jing-Jin-Ji) area, Xiong’an New Area, the Yangtze River Delta, the Greater Bay Area, and the Hainan Free Trade Port.

Power Usage Efficiency (PUE)

The word ‘PUE’ never loses its power. The availability and cost of electricity are important factors influencing data center site selection in China. The energy consumption quota of data centers must be approved by governmental agencies including National Economy and Informatization Commission and National Development and Reform Commission.

Electricity resources in coastal areas and tier I cities are restricted as local electricity generation is insufficient to meet consumption, meaning that obtaining approval for large energy consuming businesses can be problematic.

In order to ensure effective control of energy consumption, improving energy efficiency in major energy fields and accelerating the application of energy-saving and low-carbonizing technologies have become the main goals and tasks of local government during the 13th Five-Year Plan period.

China’s Tier-1 cities, with their high concentrations of data centers and infrastructure, have been first to act, guided by the central government’s 13th Five Year Plan targets for energy use and intensity. Beijing, Shanghai and Shenzhen have already applied strict PUE rules when approving new data centers, pushing the sector towards greener operations with higher energy efficiency.

Although Beijing, Shanghai, Shenzhen, Guangzhou and other coastal areas are the major data center markets in the country, areas like Inner Mongolia, Gansu, and Guizhou pop up to be players under central policy support. National-level big data and data center pilot projects sprout up in these renewables-rich provinces for they offer ample electricity supply and cheap tariffs. Local governments in these areas also offer discounts for electricity consumption by data centers, which can further reduce operating costs.

Built-to-suit Data Center

Data center investment continues to rise in China with growing interest. Larger population bases, more social media activities, data protection and cyber security legislation forcing users to switch to onshore data centers. Does it mean that to invest in this market never fail? Of course not. The consensus of ‘Customer-centric’ is being embraced by players in China market.

As a part of this, ‘built-to-suit’ data center was developed. Customizing a data center, ‘built-to-suit’, is a much different, more challenging undertaking for a certain type of business buyer, or even specific client.

Different from before, one-size-fits-all data center solutions are no longer a priority at a larger scale. More data center service providers are looking to be in tune with clients from pre-development and align with their expectations.

At the same time, built-to-suit also provides a cost transparency and speed to market. As it is specifically designed to fit the clients’ every need, built-to-suit data center can meet the goals with best practices. In 2020, Dictionary.com selected “Unprecedented” as the word of the year. In 2021, it could be “Transformation”.

For more insights on China, do check out our digital event China Datacenter Market Insights happening on March 5!

Huawei launches Smart PV solution

Huawei FusionSolar, the Smart PV solution from Huawei has launched an integrated system for residential solar energy solution.
This announcement was made at its launch event in Ho Chi Minh City.
In 2020, Huawei delivered a total capacity of 4.3 GW inverters in Vietnam. To further develop the market, Huawei FusionSolar launches a new range of products for a complete integrated system for Vietnamese homeowners including Smart Energy Controller SUN2000-2-5KTL-L1 and SUN2000-5-10KTL-M1, ESS (Energy Storage System) LUNA2000-5/10/15-S0 and Smart PV Optimizer SUN2000-450W-P.

Alen Zhang, Sales Director of Huawei FusionSolar Vietnam said: “With 30 years of expertise in digital information technology, we’ve incorporated many latest ICT technologies for optimal power generation, in building the foundation for solar to become the main energy source. Vietnam is a country with high solar power potential and we look forward to contributing towards greater adoption of solar energy among Vietnamese families with Huawei FusionSolar solutions”.

When it comes to residential PV rooftop systems, residential installers are usually expected to provide homeowners with a robust, cost-effective, self-consumption system that remains highly efficient, flexible and easy to install, and comes with smart applications and reliable customer service. Huawei’s new range of products has been developed to focus on delivering three main benefits: optimal electricity cost, active safety and better experience.

Optimal Electricity Cost
PV energy generated by solar panels meets the electricity demand of homes in the daytime, and the surplus energy generated is used to charge batteries, which then discharges to meet peak electricity consumption in the night time. In this way, residential PV systems could achieve high self-consumption levels and this is where Huawei’s residential intelligent battery Smart String ESS LUNA2000-5/10/15-S0 could truly shine. Each battery pack has a built-in energy optimizer and supports independent charge and discharge management.

The AI-Powered Arc Fault Circuit Interrupter (AFCI) proactively mitigate fire risk with rapid shutdown technologies achieving zero voltage on the rooftop and zero arc risks for dual-layer protection. Huawei is the first in the industry to integrate the AI algorithm into AFCI, enabling three unique features: accurate arc fault detection via local neural network algorithm, speedy arc fault protection by inverter shutdown in 0.5s which is far below 2.5s which is stipulated in UL1699B, and pinpointing arc fault positioning, saving 80 per cent onsite troubleshooting time and cost.

The FusionSolar inverter portfolio consists of single-phase (Smart Energy Controller SUN2000-2-5KTL-L1) and three-phase (Smart Energy Controller SUN2000-5-10KTL-M1) products, both are compatible with Huawei’s SUN2000-450W-P power optimizer.

The Smart PV Management System, available in both web portal and mobile application, provides real-time energy flow and energy balance readings, and PV panel-level performance management.

ATMs at Japan’s Lawson Bank to accept SBI Remit’s international money transfer

International remittance services provider SBI Remit Corporation and Lawson Bank, said that ATMs at Japan’s Lawson Bank will accept SBI Remit’s international money transfer service.

SBI Remit is the largest money transfer provider in Japan with over 10 billion Japanese yen monthly, with 90 per cent of its customers being foreigners living in Japan, the company said in a statement.

Through the partnership with Lawson Bank, its customers can use the “Remit Card” to make international money transfers 24 hours a day, 365 days a year and at more than 13,400 Lawson Bank ATMs, according to SBI Holdings.

The ATMs are located in Lawson convenience stores throughout Japan and offer an international money transfer service that allows customers to send money to more than 220 countries and regions around the world in as little as 10 minutes.”

SBI Remit can be used to send money to students abroad, to send living expenses to family members, or to send money to a local agent if users do not have a bank account abroad.

In a letter published on Ripplenet, SBI remit’s customers would be enabled to benefit from Lawson’s ATM network without even holding an account with the bank. The users are just required to have SBI’s “remit card” to utilize Lawson’s quality remittance services through its 13,400 ATMs.

The Lawson bank offers its services in 220 countries so, Bank’s scope will also enable customers to make transactions all over the world at any time or day of the week including on public holidays as well. The network only takes 10 minutes to perform the transaction no matter how far the two dealing parties are.