Malaysia is emerging as a data center powerhouse in Southeast Asia and the continent more broadly as demand surges for cloud computing and artificial intelligence.
Over the past few years, the country has attracted billions of dollars in data center investments, including from tech giants like Google, Nvidia and Microsoft.
Much of the investments have been in the small city of Johor Bahru, located on the border with Singapore, according to James Murphy, APAC managing director at data center intelligence company DC Byte.
“It looks like in the space of a couple of years, [Johor Bahru] alone will overtake Singapore to become the largest market in Southeast Asia from a base of essentially zero just two years ago,” he said.
Johor Bahru was named as the fastest growing market within Southeast Asia in DC Byte’s 2024 Global Data Centre Index.
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The report said the city has 1.6 gigawatts of total data center supply, including projects under construction, committed to or in the early stages of planning. Data center capacity is typically measured by the amount of electricity it consumes.
If all planned capacity comes online across Asia, Malaysia will only be surpassed by the larger countries of Japan and India. Until then, Japan followed by Singapore currently lead the region in terms of live data center capacity.
The index did not provide a detailed breakdown of data center capacity in China.
Shifting demand
The vast majority of data center infrastructure and storage investments have traditionally gone to the established markets of Japan and Singapore, as well as Hong Kong.
However, the global pandemic expedited the world’s digital transformation and cloud adoption, leading to surges of demand for cloud providers in emerging markets like Malaysia and India, according to a report from global data center provider EdgeConneX.
“Increased demand for video streaming, data storage, and anything done over the internet or on a phone, essentially means that there’s going to be more need for data centers,” said Murphy.
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Booming demand for AI services also requires specialized data centers to house the large amounts of data and computational power required to train and deploy AI models.
While many of these AI data centers will be built in established markets such as Japan, Murphy said emerging markets will also attract investments due to favorable characteristics.
AI data centers require a lot of space, energy and water for cooling. Therefore, emerging markets such as Malaysia — where energy and land are cheap — provide advantages over smaller city-states like Hong Kong and Singapore, where such resources are limited.
Spillover from Singapore
Friendly policies toward data centers have also made Malaysia an attractive market. Authorities launched the Green Lane Pathway initiative in 2023 to streamline power approvals, reducing the lead time to as short as 12 months for data centers.
However, another major catalyst in recent years has been policy across the border in Singapore.
While Singapore’s talent pool, business trust and fiber connectivity make it an attractive area for data centers, the government began moderating data center capacity growth in 2019 due to the scale of their energy and water consumption.
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Thus, a lot of investment and planned capacity has been redirected from Singapore to the bordering Johor Bahru over the years.
Singapore recently changed its tune and laid out a roadmap to grow its data center capacity by 300 MW on the condition more projects meet green-friendly efficiency and renewable energy standards. Such efforts have attracted investments from companies like Microsoft and Google.
Still, Singapore is too small for wide-scale green power generation, thus there remain a lot of limitations on the market, said DC Byte’s Murphy.
Resource strains
While the boom in data centers has helped lift Malaysia’s economy, it’s also created concerns about energy and water requirements.
Kenanga Investment Bank Research estimates that potential electricity demand from data centers in Malaysia will hit a total maximum demand of 5 GW by 2035. The current installed electrical capacity for all of Malaysia is about 27 GW, according to Malaysian electricity company Tenaga Nasional Berhad.
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Local officials are increasingly concerned about the extent of this power usage, as quoted in a recent report from The Straits Times.
Johor Bahru city council mayor Mohd Noorazam Osman reportedly said data center investments should not compromise local resource needs, given the city’s challenges with its water and power supply.
Meanwhile, a Johor Investment, Trade, and Consumer Affairs Committee official told ST that the state government would implement more guidelines on green energy use for data centers in June.
据报道，随着对云计算和人工智能（AI）的需求激增，马来西亚正崛起成为东南亚乃至整个亚洲的数据中心强国。在过去的几年里，该国吸引了数十亿美元的数据中心投资，其中包括来自谷歌、英伟达和微软等科技巨头的投资。
根据数据中心情报公司DC Byte的亚太区董事总经理James Murphy的说法，上述大部分投资都集中在与新加坡接壤的小城市新山(Johor Bahru)。
“现在看来，在未来两三年内，仅新山一地就将超越新加坡，成为东南亚最大的市场，而就在两年前，它还几乎一无所有。”他说。
DC Byte的2024年全球数据中心指数（Global Data Centre Index）将新山列为东南亚增长最快的市场。该公司报告称，包括在建项目、已承诺或处于规划初期阶段的项目在内，该市的数据中心总供应量为1.6吉瓦。数据中心容量通常以耗电量来衡量。
报道还称，如果亚洲各地所有计划中的数据中心都上线，马来西亚在日本和印度之后，仅位列第三。
需求变化
传统上，数据中心基础设施和存储投资的绝大部分都流向了日本、新加坡等成熟市场。然而，根据全球数据中心提供商EdgeConneX的一份报告，新冠病毒大流行加速了世界的数字化转型和云采用，导致马来西亚和印度等新兴市场开始崛起。
Murphy表示，“对视频流、数据存储以及通过互联网或手机完成的需求都在增加，本质上意味着对数据中心的需求将会增加。”
而人工智能热潮更是引爆了这些需求，因为AI服务需要专门的数据中心来容纳训练和部署人工智能模型所需的大量数据和计算能力。Murphy表示，虽然许多人工智能数据中心将建在日本等成熟市场，但新兴市场也将因其有利的特点而吸引投资。
据了解，人工智能数据中心需要大量的空间、能源和冷却用水。因此，相对于资源有限的新加坡等较小的城市国家，马来西亚等能源和土地价格低廉的新兴市场具有优势。
最后，对数据中心友好的政策也使马来西亚成为一个有吸引力的市场。马来西亚政府在2023年启动了“绿色通道”计划，将数据中心的审批时间缩短至最短12个月，以简化电力审批流程。
不过，尽管数据中心的繁荣推动了马来西亚经济的发展，但也引发了人们对能源和水资源需求的担忧。有机构估计，到2035年，该国数据中心的潜在电力需求将达到5吉瓦的最大需求。