Industry leaders urge govt to include more local data centre players under MyDigital initiative

The SME Association of Malaysia (SME Association) and National Tech Association of Malaysia (PIKOM) are calling for the government to include more local players in the building and management of hyperscale data centres as well as the prevision of hybrid cloud services under MyDigital. As announced by Prime Minister Muhyiddin Yassin, the government has given conditional approvals to Microsoft, Google, Amazon and Telekom Malaysia (TM), to offer the services which will require an investment of RM12 to RM15 billion over the next 5 years. The initiative is meant to support the government’s aim of migrating 80% of public data into the hybrid cloud system by end-2022 as part of its ‘cloud first’ strategy.

SME Association VP, Chin Chee Seong

SME association Vice-President Chin Chee Seong said the initiative should be broaden to include more local data centre providers to further develop local talent, skill, IP (intellectual property) for Malaysia. Chin who is also the national president of Malaysia Cross-Border eCommerce Association said, “Some of our local data centre providers are already of world class standing, with quite a number already supporting multinationals and organisations here in Malaysia and throughout the region.”

He added that SME Association is fully supportive of the ‘cloud-first’ initiative as it will make management and data collection more efficient, with lower cost of managing information technology in the long term. Cloud services will bode well for big data, AI, IoT and other technologies which will enhance government services. The association urge the government to go beyond the four mentioned companies and to also include other local leading data centre players.

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Chin said in recent years, Malaysian data centre market was on an upward trajectory, largely fuelled by local and international providers. This was due to Malaysia’s ‘lower base” as compared to other mature markets such as Singapore, Hong Kong and Japan.

He said Malaysia’s data centres with enhanced data speeds serve end-consumers in other regional densely populated cities and it has also seen increase in local demand. He is confident that our local ecosystem has the expertise and technologies to build hyperscale data centres to challenge competition from other markets such as Hong Kong and Singapore.

PIKOM chairman Danny Lee

Sharing the same sentiment is PIKOM chairman Danny Lee. He said adopting a level playing field which include local data centre providers would ensure that the industry would continue to thrive.

From the announcement by the government, TM is the only local company earmarked for the initiative. He said that we should not forget other local players which have successfully built up this market for Malaysia and our country is known as an ideal location for business continuity and disaster recovery.

“Thanks to efforts from our local data centre providers, Malaysia is also increasingly becoming a regional hub for various industries such as manufacturing, logistics and big data analytics. As more organisations embark on investing in cloud systems, the need for more local data centres is set to rise – and we expect the market in years ahead to be exponential,” he added.

MyIX chairman Chiew Kok Hin

Malaysia Internet Exchange (MyIX) chairman Chiew Kok Hin hopes that the government will eventually provide more details and clarity on the MyDigital plan for hyperscale data centres and managed service providers (MSPs). He said what has been disclosed thus far are just broad strokes of the overall ‘cloud first’ strategy and MyIX believes that the execution is just as critical for Malaysia to realise its aspirations of becoming a data centre hub in Asia-Pacific.

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Chiew also said Malaysia has its strengths in internet infrastructure due to our strategic geographical location, ease of access and relatively lower cost of entry. He also said that government policies should always be investor friendly if we are to continually attract foreign investors into Malaysia. He also reminded that the government should also recognise local data centre providers for their ongoing efforts in growing the industry.


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Alexander Wong