Equinix plans to open its first data centre in Kuala Lumpur in the first quarter of 2024 as it seeks to stake a huge share of Malaysia’s robust cloud and e-commerce market. The news comes six months after the company first announced its expansion into the country last November with an IBX data centre in Johor. That data centre dubbed JH1, being built under an initial US$40 million investment, is also expected to open on Q1 2024.
According to Synergy Research, Malaysia is already the third largest data centre colocation market in the ASEAN region, and is forecast to have a compound annual growth rate of approximately 11% from 2022–2027.
With continued investment in 5G, Malaysia is one of the fastest growing data centre markets in the ASEAN region, with much of the development attributed to Johor and Kuala Lumpur. Equinix’s expansion is expected to provide greater digital infrastructure capacity in Malaysia to address rising demand from local and global companies expanding in the country.
“Over the past several years, we have witnessed Malaysia emerge as an increasingly strategic location for global digital infrastructure, and we believe it to be an attractive destination for data center growth and investment. Following our initial investment in Johor, we are excited to add another data center in Kuala Lumpur,” said Jeremy Deutsch, president, Asia-Pacific, Equinix.
“By expanding Platform Equinix in the two most strategic metros in Malaysia, we will enable Malaysian businesses, as well as multinationals with a presence in Malaysia, to leverage a trusted platform to bring together and interconnect the foundational infrastructure to power their success. We believe the two data centers will fuel Equinix’s existing data centre momentum and support Malaysia’s aspirations as a digitally driven connectivity hub.”
In Asia-Pacific, Equinix currently operates 51 data centers in 13 metros across Australia, China, Hong Kong, India, Japan, Korea and Singapore, with expansions announced in Indonesia and Malaysia.
Supporting Malaysia’s digital goals
As Malaysia enters Phase 2 of its MyDIGITAL blueprint for a digital economy, demand for digital infrastructure is expected to remain robust. With extensive global experience in supporting 5G development, Equinix’s new facility aims to accelerate the digital vision laid out in the government’s blueprint to establish Malaysia as a hub for colocation in ASEAN and a regional digital economic powerhouse.
The new facility in Kuala Lumpur, named KL1, together with JH1 in Johor, will also provide digital infrastructure that businesses need to capitalise on the country’s digital economy.
The KL1 IBX data centre will be in Cyberjaya within Kuala Lumpur. Cyberjaya is a key part of the Multimedia Super Corridor in Malaysia, a government-designated zone to promote and boost Malaysia's digital economy.
The first phase of KL1 will provide an initial capacity of 450 cabinets and colocation space of 1,300 square metres. When fully built, it will provide a total of 900 cabinets and colocation space of 2,630 square metres.
"Malaysia is a vibrant market for digital infrastructure, driven by a strong economy, growing demand for digital services, a favorable location and increasing investments from the world's leading hyperscale operators. That is opening up major long-term growth opportunities for leading data centre operators,” said John Dinsdale, chief analyst and research director, Synergy Research Group
KL1 will enable global networks, content providers and enterprises to exchange high volumes of internet traffic via Equinix Internet Exchange. Through one of the world’s largest global peering solutions at scale, internet service providers will have access to new digital corridors to exchange data directly with other internet service providers, participating in the flourishing digital economy and e-commerce landscape in ASEAN.
Malaysia has positioned itself as an attractive digital infrastructure and cloud services hub, providing additional capacity to meet neighbouring Singapore’s demand for digital infrastructure. With its strong multicloud connectivity, KL1 and Equinix Fabric will enable companies to deploy their infrastructure to connect with leading cloud service providers, including Alibaba Cloud, Amazon Web Services (AWS), Google Cloud and Microsoft Azure, safeguarding their business-critical data in a private and secure environment.
Malaysia digital leaders welcome move
For the country’s digital leaders, Equinix’s expansion into Johor and Kuala Lumpur is a show of confidence in Malaysia’s potential as a top-tier data centre destination. And they expect the KL1 and JH1 data centres to speed up the development of the digital economy nationwide.
“These data centres will act as catalysts for digital innovation, enabling businesses to harness the power of advanced technologies such as cloud computing, artificial intelligence and big data analytics,” said Datuk Wira Arham Abdul Rahman, chief executive officer of the Malaysian Investment Development Authority (MIDA).
Mahadhir Aziz, chief executive officer of Malaysia Digital Economy Corporation (MDEC), echoed the same sentiment: “Equinix's investment and expansion in Malaysia propels us closer to our vision of firmly establishing Malaysia as the digital hub of ASEAN.
He added: We are committed to supporting Equinix's presence in Malaysia and to fostering the growth of the nation's data centre industry through various PEMANGKIN initiatives. KL1 not only fortifies Malaysia's digital infrastructure but also accelerates our ongoing digital transformation. This move signifies unwavering confidence in Malaysia's resilient and robust data center ecosystem, its digitally skilled talent pool, and world-class infrastructure.”
Datuk Muhammad Azmi Zulkifli, chief executive officer of InvestKL, said: “This growth story is an affirmation of the country's ease of doing business, strong economic fundamentals and competitiveness which further positions us as the emerging digital hub in Asia. It is no surprise that the KL1 data centre has been strategically placed in Kuala Lumpur. Kuala Lumpur offers a vibrant tech ecosystem, robust digital infrastructure and dynamic talent that is well-enabled to support Equinix's investment goals and aspiration of supporting Malaysia's digital transformation.”
