A data center in Indonesia can provide some benefits for businesses. This particular data center’s location is in an area with a stable and reliable power grid. Also, it has a positive local reputation as a hub for tech-savvy individuals.
Data centers are growing exponentially in Indonesia, especially since its economy has been booming. The World Bank expects the country’s GDP growth rate to reach 6.2% and 6% next year.
During the pandemic, Indonesian workers work from home; this involves popular online applications such as zoom meetings. This causes an increase in the flow of data on the network and automatically increases the need to store data.
The Growth of Data Centers in Indonesia 2019 – 2022
Number of data centers has snowballed in Indonesia, the third largest economy in Southeast Asia. The Indonesian Investment Coordinating Board (BKPM) expects the country’s IT industry to grow by 10% annually from 2017 to 2020.
Government is investing in infrastructure upgrades and technology, specifically fiber optic cables which will improve internet speeds throughout the country.
Indonesia’s infrastructure is also improving rapidly, with companies laying around 100 subsea cables over the next few years, including one owned by Google, which connected to Singapore directly from Jakarta.
In 2019, experts expected the data center growth in Indonesia to increase by 30 percent as more businesses create their private cloud infrastructure and deploy hybrid cloud solutions.
The country’s growing tech sector is boosting infrastructure and cloud services demand. As more businesses adopt the cloud model, demand for data center capacity will increase by 30 percent annually through 2022.
The internet enabled people to work from anywhere during the pandemic, but it has also led to a surge in data centers built worldwide.
Indonesia is no exception. The country is building more data centers as companies seek to take advantage of its skilled workforce and relatively low costs.
Indonesia as a country has become an attractive destination for international companies looking to set up regional headquarters or hubs. These companies include Google, Facebook, TikTok, Shopee and Twitter.
This demand has led to an increase in investment by multinationals as they look to capitalize on Indonesia’s fast-growing economy and large population.
Data Centers Growth in Post Pandemic
The Indonesian government has set several ambitious targets when it comes to ICT development, including:
- By 2025 all schools will have access to digital education services online through their school portal or tablet computers;
- By 2025 every village will be connected by broadband;
- By 2025 all government agencies will use e-services instead of paper documents;
The growth of the data center market in Indonesia is driven by growing demand for cloud services and increasing adoption of cloud computing, increasing adoption of Big Data analytics and Artificial Intelligence (AI), a growing number of start-ups and SMEs, growing demand for IT infrastructure management services, and increasing need for disaster recovery solutions in the country.
As the working style of hybrid has become a trend, it is causing the need for more data centers in Indonesia.
Because of the increase in hybrid working, we need to create a new way of working where employees can do that by using online tools and applications such as Google Docs.
With this kind of technology, people need to have easy access and a better connection to the internet so that they can work anywhere, anytime, even if they are not at their office.
As a result, more and more companies are looking for a place to locate their servers. They want to be close to their customers and their clients.
Conclusion
As internet usage increases, tech companies are flocking to Indonesia because of its potential to become one of the largest markets in the world.
The country has over 260 million people, and 69% of its population already have access to broadband internet.
Forecasts suggest that Indonesia’s data center market will grow at a CAGR of 8.3% from 2019 to 2022. This represents revenue of $2.8 billion in 2022.
The latest news we received from a trusted source, Goldman Sachs, will be investing in a data center, a green data center located in South Jakarta, Indonesia.
This investment is in the strategic area, low latency, and using natural gas to reduce carbon emissions. Estimations say the investment value is at IDR 1.5 trillion (USD 100 million).
Data center in Indonesia have been increasing over the last few years. As industries build new infrastructures in Indonesia, the fast-growing data center industry will only continue to grow.