The annual World Economic Forum (WEF) in Davos is known to set the agenda for the way forward. Climate change, renewable energy usage, and such issues were seriously debated in the previous editions of WEF Summits. This year- Metaverse found its place in the universe.
Industry experts have predicted that Metaverse or the usage of virtual reality would help in various fields, especially medical and rescue operations which at certain times becomes impossible for humans to carry out tasks in person.
Metaverse by definition means a virtual reality setup with a nonfungible token (NFT) acting as a commodity which can be used to buy art, land, clothes etc. As governments wrap their head around Metaverse, South Korea has decided to take a lead.
Digital New Deal Initiative
As part of its Digital New Deal, a program for investing in new technologies in the country’s economy, the Ministry of Science and Information and Communication Technologies said that it plans to kickstart the metaverse industry in South Korea by supporting companies and creating jobs. Minister of Science and ICT Lim Hyesook called the metaverse “an uncharted digital continent with indefinite potential,” with the government earmarking 223.7 billion won ($177.1 million) for this initiative.
Further, Seoul’s metropolitan government is building a 3.9 billion-won metaverse platform to allow citizens to access public services virtually. In effect, all this fits into the concept of Web3, an umbrella term which covers the metaverse, virtual reality, augmented reality and blockchain technology, as well as digital assets such as cryptocurrency.
Impact on Data Centres
Technologies such as Web3, metaverse will all tie into higher digital adoption, which naturally translates into an exponential increase in data centre requirements at the back-end. The South Korea data center market size will witness investments of USD 5.25 billion by 2026, growing at a CAGR of 7.72% between 2021–2026.
The emergence of infrastructure solutions such as new hyperscale and colocation data center operators are expected to propel the market in South Korea. Ed Lenta, Senior Vice President and General Manager of Databricks Asia Pacific said:
“As one of the largest markets in the Asia Pacific region, Korea is a natural expansion for us and a reflection of growing demand from businesses looking to adopt an open, modern lakehouse architecture and accelerate their cloud data strategy.”
In April this year, a news development turned the heads of South Korea’s business fraternity. Digital Edge (Singapore) Holdings Pte. Ltd. (“Digital Edge”) has announced plans to significantly expand its operations in South Korea by building a 120 megawatt (MW) facility in Bupyeong-gu, Incheon through a strategic partnership with SK Ecoplant, a leading local developer. Samuel Lee, Chief Executive at Digital Edge said:
“Korea has one of the fastest growing data center markets and this investment forms part of our ongoing commitment to this dynamic country, as we seek to bring the next generation of digital infrastructure to Asia. By partnering with SK Ecoplant, a trusted local developer, we will combine their development knowledge with our data center build and operations experience, to deliver the largest, state-of-the-art data center in the country.”
The new facility will be based on Digital Edge’s next generation architecture and a highly efficient engineering design to minimise water and energy usage. With South Korea ranked fifth in the Asia Cloud Computing Association’s Cloud Readiness Index, this facility is designed to meet fast growing demand from local and international cloud providers, as well as other high power density applications such as hyperscale, large digital media, and enterprise deployments.
Located in Bupyeong-gu, Incheon, the site is well situated with easy access to Incehon International Airport and Seoul’s major business districts via the Seoul-Incheon Expressway. Moreover, the project will provide a natural extension to Digital Edge’s existing carrier dense location in Yeoksam (SEL1), with the two data centers linked via third party telco services as well as the Cross Link product to bring a wealth of connectivity options to existing and future customers.
Giants such as Alibaba are seeing immense potential in the Korean market. Since Alibaba Cloud entered the South Korea market in 2016, it has introduced proven technologies from the Alibaba ecosystem to serve a wide array of South Korean customers in various industries including retail, finance, manufacturing, logistics, media & entertainment, and internet companies.
Also, Canada Pension Plan Investment Board (CPP Investments) and Pacific Asset Management Company (Pacific) have announced a KRW 200 billion (C$214.3 million) joint venture to develop the largest carrier-neutral hyperscale data centre, Jukjeon Data Centre. Demand for data centres in Asia Pacific continues to grow and is boosted further by the COVID-19 pandemic.
Companies in South Korea are in need of digital infrastructure as the country is emerging as a technology and innovation hub in the region, noted Gilles Chow, Managing Director, Head of Real Estate North Asia, CPP Investments.