Singapore cements position as regional datacentre powerhouse

With 90% of the world’s data created in the last two years, it’s hardly surprising that the datacentre industry is booming, with cities around the world racing to entice the global tech giants and datacentre providers to open facilities in their hometowns.

The economic benefits of datacentres are immense. Not only are they magnets for the brightest minds from around the world, they also draw investments in local infrastructure and create jobs. Datacentres, the equivalent of air and sea ports in the virtual world, also elevate a city’s standing on the global information superhighway.

While it’s easy for governments to declare their intentions to become datacentre hubs, it takes more than that to become one. For one, a city needs to offer reliable and sustainable energy sources, a robust network infrastructure with good international connectivity and plenty of bandwidth, a sound regulatory framework, and a pro-business and stable political environment.

Singapore ticks all the right boxes, at least according to the new Data Center Risk Index study that identifies the top risks likely to affect datacentre business operations. Conducted by global real-estate services firm Cushman & Wakefield, the study placed the city-state in pole position out of 10 Asia-Pacific (APAC) countries in terms of robustness of datacentre business operations. Other countries/territories in the top five are South Korea, Hong Kong, Japan and Australia.

Singapore already sits at the top of the APAC datacentre market in terms of capacity, with a current total supply of 370 MW of IT power supply among co-location operators, according to Cushman & Wakefield.

“Around 59 MW of IT power is readily available for datacentre use, and 103 MW can be converted into IT power within three to six months should demand keep pace. Singapore has seen an influx of new datacentre capacity in the last two years, with an additional 130 MW on top of the existing capacity of 240 MW at the beginning of 2015,” it said in its report.

The company predicted that over the medium to long term, Singapore should be able to expand its capacity by another 100 MW on the back of its smart nation initiative. “Local datacentre providers such as Singtel, Keppel Data Centres and ST Telemedia stand to be the primary beneficiaries of this, while the international datacentre providers will continue to focus on winning international deals from medium to large enterprises coming into Singapore,” it added.

Krupal Raval, Digital Realty’s chief financial officer for APAC, noted that one of the key factors behind Singapore’s booming datacentre industry lies in its vast interconnectivity. With no less than 17 submarine cables, businesses are able to take advantage of the low-cost and low-latency connectivity, enabling them to be agile when operating across regions.

“Geographically, Singapore is also close to major emerging markets such as Indonesia, Malaysia and Thailand, while being well connected to established locations like Australia, China and Japan – making it an unmatched internet and trading gateway across the Asian market,” Raval said. “Constant uptime is crucial to datacentre operations. In this day and age, downtime will have a profound impact across industries.”

Singapore’s land constraints, however, could put a damper on its position as a datacentre hub. Earlier this year, the Singapore government said it will conduct a feasibility study with Huawei and Keppel Data Centres to explore the possibility of developing a high-rise datacentre building possibly more than 20 storeys high.

However, the study will not be just about stacking datacentres on top of each other in a high-rise complex. It will also look into building architecture and innovations that can significantly reduce energy use, or increase efficiency to lower the best PUE ratings in Singapore by 10-20%.

Such efforts are laudable, and will go a long way to cement Singapore’s leadership in the regional datacentre market, beyond creating a green datacentre scheme.