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Choosing the Ideal Data Centre Partner to Support Your Growth into Indonesia

Richard Pain | July 3, 2017
Indonesia's economy is booming, so how can you choose the right data centre partner to support your growth into the market?

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As one of the fastest growing countries in Southeast Asia, Indonesia is a key market for companies looking to expand in the region. But it’s not just the country’s GDP growth that makes it attractive, it’s also the rapidly growing internet penetration rate. According to a survey conducted in late 2016 by the Indonesian Internet Service Provider Association, there are now 132.7 million Internet users in the country, up from 88 million users in 2014, amounting to 51.8 percent of Indonesia's total population. 


Naturally this is leading to a massive growth in the use of and spending on digital products and services. According to The Straits Times article dated 27th March 2016, Indonesia’s Information and Communications Technology Ministry predicts Indonesia's e-commerce market reach US$130 billion in 2020. With a predicted annual growth of 50 per cent, this will make it the third highest ecommerce market in Asia, only surpassed by China and India.


This presents a prime opportunity for companies looking to provide digital products and services in Indonesia and capitalise on the country’s rapid growth. Yet doing so raises important questions regarding choosing the ideal data centre provider, in terms of business requirements and partnering for reliable, long term growth.


Choosing the Ideal Location for Your Data Centre


To better understand the priorities companies have when it comes to choosing a data centre provider in Southeast Asia, the IT research and advisory company 451 Research surveyed 512 multinational corporations headquarters in North America, Europe, and China. This revealed that the top factors, ranked in order of importance, when choosing the location of a data centre are:


1. Regulatory environment

2. Geographic location

3. Local workforce

4. Market maturity 

5. Electricity


It is largely based on these priorities that Singapore is becoming increasingly well established as an ideal data centre hub and launch pad into the region. The country is already a gateway for 16 international submarine cable networks, connecting from the East to South Asia, as well as other regions such as the Persian Gulf, the Mediterranean, Europe and US, making it one of the most connected countries in Southeast Asia. Other factors that contribute to Singapore being an ideal choice include the country’s stable political system, conducive regulatory environment, reliable power supply and freedom from natural disasters.


Then in terms of market maturity, according to Canadian research and consulting firm Structure Research, Singapore has seven new data centre expected to go online over the next three years to support growing co-location activity. This is compared to Hong Kong which has only three new facilities planned during the same period. 


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