The APAC data center market outlook 2021-2026: Report 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.


SG | MY | ID | TH | VT | PH

When: 23-26 February 2021

Where: Online

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!

Modular data center market to double by 2025: Research and Markets

The worldwide modular data center market is expected to grow significantly from $18 billion in 2020 to $37.8 bilion by 2025, as per latest research from Research and Markets.

This growth will be driven by continued demand from all-in-one modules segment and translates to a 15.4 per cent Compounded Annual Growth Rate (CAGR).

Modular data centers are manufactured by integrating prefabricated modules that are built inside a factory and shipped to the client site where they assembled, deployed, and commissioned. These data centers are highly scalable and energy-efficient and can be rapidly deployed to meet the clients current and near-term needs.

All-in-one modules segment to grow at the highest CAGR during the forecast period. The all-in-one module is a highly integrated containerized data center facility used in enterprise data management, oil exploration, and disaster relief. It is a temporary module usually implemented in cases, wherein data center mobility is a concern, as it comprises modules with cooling, power, and IT systems built inside a single container.

These containerized modules are both portable and energy-efficient and provide an on-site, ready-to-deploy solution, which reduces the installation cost and time. They also enable scalability and flexibility to the IT infrastructure to adjust to the design and size for future deployments.

This advantage of the all-in-one module, wherein organizations can implement scale-out infrastructure is expected to fuel the market for modular data centers.

Further, the APAC region is expected to grow at the highest rate, according to Research and Markets.

APAC to drive growth

With many major developing countries in this region, APAC is expected to contribute significantly to the modular data center market during the forecast period.

More mature markets, including India, China, Japan, Australia, and New Zealand are also projected to witness mushrooming of new modular data centers in the coming years, the report pointed out.

The rapid growth of social media and the gaming sector in the APAC region has further increased the demand for explicitly scalable architecture that is capable of handling complex operations, which can be met by the effective deployment of modular data center solutions, the report said.

$4.9bn investment opportunity for India’s data center market following tripling in capacity

India’s data center market is expected to present a US$4.9 billion investment opportunity, following a tripling of data center capacity by 2025.

Research by property consultancy firm, JLL, revealed data center capacity will grow from 375 MW to 1,078 MW over the next five years due to increasing adoption of new technologies and impacting data localisation laws.

“India’s data center market will outperform over the next five years, supported by a combination of growing digital economy, increased investor interest and stable long-term returns,” said Ramesh Nair, the CEO and Country Head for India at JLL.

Source: JLL

Rising demands in the data center industry has been accommodated by colocation data centers offering lower costs, greater security and scalability.

The additional 703 MW of forecasted capacity will require 9.3 million square feet of space, opening up greenfield investments for real estate developers. 

This new capacity will support industries who are becoming increasingly dependent on digital infrastructures, particularly during the COVID-19 pandemic, including banking, e-commerce, social media and education.

“Powered by the transition to work from home arrangements during lockdown, the country’s data center industry became the backbone of the digital economy and ensured a level of business continuity and sustained large portions of the country’s education system,” said Rachit Mohan, India Head for Data Center Advisory at JLL.

Source: JLL

India’s data centers provided an immense boost to the digital economy during the first half of 2020, with a 14% rise in daily data center consumption seen during lockdown. And in the second half of the year, India is expected to see an additional 57 MW, which is twice that of the 27 MW of new supply in the first half.

“Given shifts in the economy, we will continue to see data consumption increase manifold for the foreseeable future,” said Mr. Mohan.

To manage the increasing consumption, India’s total data center supply increased by 8% to 375 MW in 2020 so far, with investments made by Equinix, Web Werks, Yotta as well as upcoming moves by Carlyle and NTT.

“Mumbai is expected to see highest capacity addition as it continues to be the preferred choice for large cloud players because of its infrastructure advantage,” said Dr Samantak Das, the Chief Economist and Head of Research and Real Estate Intelligence Services at JLL.

The cities of Chennai and Hyderabad also have potential to be data center hubs, due to low development costs, reliable power supplies, cloud computing demand and submarine cable landing stations.

Source: JLL

Just last week, Orient Link and NEC Corporation announced an agreement to build a MIST submarine cable system that will deliver high-quality, low-latency networks to India, as the nation charges forward with its digital transformation roadmap.

Looking forward to the future, India’s data center market is poised for a bright future with more hyperscale and colocation data centers as long as the country commits to data localisation laws and harnesses the true power of cloud computing and Industry 4.0 technology like 5G, edge computing and the Internet of Things.

What does the future hold for India’s data center market?

The need for data centers in India is growing exponentially, as data consumption by half a billion digital users is reaching unprecedented levels.

But how can you tap into this exciting market? And what is the best practice for data center operators and cloud service providers in the country?

Stay tuned for more fascinating webinars taking a deep dive into the data center and cloud markets in India!

Get involved in the conversation and connect with your peers on LinkedIn, Facebook and Twitter using #WMediaEvent!

$4.9bn investment opportunity for India’s data center market following tripling in capacity


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Stuart Crowley

Editor, W.Media

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