Equinix enters Malaysia with US$40M data center investment

The Malaysian data center market has seen positive growth in 2022. Some of the major data center announcements made this year included the setting up of cloud regions by Google Cloud as well as data center investments by Microsoft and several other data center providers.

According to Arizton’s research report, the Malaysian data center market is expected to grow at a CAGR of around 7% from 2022 to 2027, with over US$2 billion forecast to be invested. Given the growth the country’s facing, this looks likely. One of the reasons for this is the infrastructure that has been able to meet the demands of data center operators.

As such, Equinix has announced its plans to enter the Malaysian data center market as well. Equinix plans to build a new International Business Exchange (IBX) data center called JH1, in Johor. With an initial investment of approximately US$40 million, JH1 is scheduled to begin operations in Q1 2024, providing 500 cabinets and 1,960 square meters of colocation space.

The world-class IBX data center will support Malaysian companies and multinationals doing business in Malaysia with access to Platform Equinix to bring together and interconnect the foundational digital infrastructure that powers their success. Equinix’s expansion in Malaysia is expected to unlock opportunities for Malaysian businesses expanding internationally and for multinational corporations pursuing growth and innovation in the Malaysian market.

Malaysian companies will benefit from the ability to accelerate their evolution from traditional to digital businesses by rapidly scaling their infrastructure, easily adopting hybrid multi-cloud architectures, and interconnecting with strategic business partners within the Platform Equinix ecosystem of more than 10,000 customers. The Johor data center will also provide organizations with access to vibrant ecosystems made up of more than 2,100 networks and over 3,000 clouds, IT and system integrator services that Equinix works with globally.

Apart from Malaysia, Equinix has also announced investments around the region. In Asia-Pacific, Equinix currently has 51 data centers across 13 metros across Australia, China, Hong Kong, India, Japan, Korea and Singapore. In October 2022, Equinix announced expansion plans in Indonesia costing US$74 million while the company also announced an initial investment of over US$86 million to build its third IBX data center in Mumbai, India in June 2022.

Equinix’s expansion in Malaysia is in line with the MyDIGITAL initiative launched by the Malaysian Government, which aims to provide a blueprint for the country to accelerate the growth of digital products and services.

Datuk Onn Hafiz Ghazi, Chief Minister of Johor, said, “While the digital economy represents a catalyst for the Malaysian economy, data centers are integral in supporting digital ecosystems and their sustained growth. We welcome this investment by Equinix, along with the global expertise they bring to Johor, as well as the rich digital experiences and outcomes that will benefit this state and the country. We are looking forward to working together, in transforming Malaysia into a digitally driven, high-income nation at the forefront of this region’s digital economy.”

Jeremy Deutsch, President, Asia-Pacific, Equinix, commented, “Establishing a presence in Johor strengthens Equinix’s leadership position in Asia-Pacific within a strategic market such as Malaysia, one of the most requested markets in Asia-Pacific by our global customers. I would like to express our gratitude to the Digital Investment Office (DIO), Invest Johor, and Tenaga Nasional Berhad (TNB) for their assistance and support. We look forward to deepening our collaboration through future expansion, maximizing local businesses’ digital growth potential with rich digital experiences and outcomes.”

Deutsch also highlighted that while there may be concerns about the availability of skills to work in the data center once it is ready, he is confident that the workforce problem can be solved, given the talent that is already available in Johor.

In fact, Johor is becoming to go-to state for data centers with more companies announcing plans to build and operate their data centers there. This includes a mix of both local and international data center operators. Deutsch also pointed out that the infrastructure in Johor can support the needs of the data center industry in Malaysia.

The JH1 data center is a two-story facility that will be located at Nusajaya Tech Park (NTP) in Iskandar, Johor, 15 kilometers from Singapore to allow the data center to address excess demand from organizations in the city-state in addition to Malaysian domestic demand.

Equinix also has the option of acquiring additional land in NTP to build a second facility, supporting Malaysia’s digital growth aspirations. Companies and multinationals doing business in Malaysia will be able to access Platform Equinix to store and distribute large volumes of latency-sensitive data and applications closer to end users and local markets.

Once open, the new IBX data center in Johor will increase Equinix’s total global footprint of more than 245 data centers across 71 metros and 32 countries, providing Equinix’s 10,000+ customers more ways to securely deploy, directly connect and effectively scale their digital infrastructure in a rapidly growing economy. It is expected to also present opportunities for further expansion into new metros and market segments in Malaysia.

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