- Malaysia’s solid market has driven need in the data center market
- Country’s data center market prospect excels in SEA due to enormous strength, skilled labor
In the second quarter of 2024, Malaysia became the fastest-growing data center business in the company’s fastest-growing area, according to new insights released by international real estate and proptech firm Juwai IQI.
Malaysia is becoming a major contender in data centers as a result of its rapid transformation, according to Juwai IQI co-founder and team CEO Kashif Ansari. ” If all the state’s planned new data centres come online, Malaysia will become Asia’s third biggest market, behind just Japan and India. He continued, adding that that will result in tens of thousands of local jobs that are qualified.
International Changes
According to Ansari, the global data centre industry is growing quickly this year because of demand from artificial intelligence ( AI), machine learning, e-commerce, and cloud computing. ” All four fields use significant amounts of computing power from data centers. Their rapid development has resulted in the growth of large-scale data centers. The largest example of these large services is comparable to Vatican City in size, measuring roughly the size of 75 sports fields. By comparison, a typical medium-colocation information center is only about 10, 000 m² in length. That is equivalent to around two soccer grounds”, he added.
” Data centers consume so much power that, in the next two and a half years, the consumption of AI electricity will likely account for 50 % of all global electricity consumption, and it will only continue to grow.” Every 100 times, almost every 100 days, AI’s need for computing power doubles. The supply of power is such high that power supply has become a major drag on the growth of data centers in every significant industry, from Singapore to Virginia. According to Ansari, designers are responding by creating new data centers close to existing power plants or by constructing new ones in addition to their existing data center projects.
Malaysia’s Fast Rise
Let’s take a look at why Malaysia’s information center industry is expanding so fast. The state is Southeast Asia’s most fast growing data center market- its strategic location, advantageous government policies, proximity to Singapore, and tastefully priced land, power, and water are behind this growth. In Malaysia, the data centre business development network consists of 1.2 GW, which represents 600 % rise over the next five times”, Ansari said.
Major cloud service providers such as Amazon Web Services ( AWS), Microsoft, Nvidia, and Google have recognised Malaysia’s attractive market. All have pledged to invest a lot of money in this. Also, Malaysia’s robust economic efficiency has helped raise demand in the data center industry.
The country’s GDP growth rate has been consistently high by global standards. The nation has also undergone a transformation in its economy, shifting from a reliance on exports of raw materials to a diversified economy with a significant services sector. Services now make up more than half of GDP, the report highlighted.
The Malaysian data center market also benefits from government policy support, it added. The government has offered tax incentives, grants, and regulatory support to attract data centre investments.
Additionally, a single point of contact between the Malaysian Investment Development Authority and the Malaysian Digital Economy Corporation has been established to facilitate digital investments. Additionally, they created the Green Lane Pathway, which would allow for 12 months for new data centers to get electricity.
The existence of a highly developed telecommunications infrastructure in Malaysia is another sign of a far-sighted government, according to the report. This ensures high-speed internet connectivity and low latency, both essential for data centre operations.
According to the study, data centers deserve government support because they produce significant employment, adding that there are direct employment there as well as by many external employees and clients and suppliers. A single hyperscale data center can take more than five years to build, and it has more than 1, 000 employees working on-site every day. This is also labor-intensive when building data centers.
Malaysia’s Key Market Metrics
The data centers in Malaysia have the power to keep 280 megawatts of computers running all the time, and the power is measured in megawatts ( MW). According to the report, other data centres are already under construction, about to start construction, or in the planning stages. In total, the live capacity and the under-construction and planned capacity equal 3, 221 MW.
It highlights that:  ,
• Total Live Capacity: 280 MW ,
• Total Under Construction Capacity: 159 MW ,
• Total Committed Capacity: 766 MW ,
• Total Early-Stage Capacity: 2, 016 MW
Key players in the Malaysian data centre market include NTT Global Data Centres, AWS, Microsoft, Google, and local firms such as TIME dotCom and Bridge Data Centres. Greater Kuala Lumpur and Johor are almost entirely the early-stage planned construction of new data centers, with about 55 % of new projects planned for this year.