Singtel builds out ASEAN data centre strategy, deepens Telkom alliance in Indonesia

Singtel has expanded regional data centre capabilities through a deepened partnership with Telkom in Indonesia, in a move designed to capitalise on “robust growth” across key markets in ASEAN.

Central to such efforts is the creation of a data centre platform that will work with partners to build and acquire data centres in the region with enhancing infrastructure foundations high on the agenda amid increased cloud adoption and digital transformation demand.

In alignment, the Singapore-based telecommunications provider has carved out its top-tier data centres — DC West and Kim Chuan 2 — into a separate Singtel-owned entity with approximately 60 MW of capacity.

In addition to securing a site in Tuas for a new integrated cable landing and data centre facility which is expected to be completed with “three to four years” and adding 30-40 MW in capacity, the business will continue to explore adding further capacity.

“As businesses rapidly digitalise, and with the growing adoption of IoT [Internet of Things], artificial intelligence and 5G across the region, demand for high-quality data centres is on the rise,” said Yuen Kuan Moon (pic), group CEO of Singtel. “This partnership with Telkom is an important step for our data centre strategy, bringing together the prime assets, expertise and networks of two market leaders in data centre operations in Indonesia and Singapore.”

Telkom currently has an existing portfolio of 27 data centres in Indonesia and the region, with work also underway to build a hyperscale facility with 75 MW capacity to serve local and international customers.

As part of the agreement, selected data centre assets from Telkom will be placed in the data centre platform, supported by strategic collaboration on development opportunities and the exploration of bringing third-party investors or partners into the platform.

Besides Indonesia, Singtel is also sizing up the data centre market in Thailand following the signing of a joint development agreement with Gulf Energy and Singtel’s regional associate AIS to start developing data centres in February, with the new joint venture expected to be launched “soon”.

“As the largest digital economy in ASEAN, Indonesia is a strategic data centre market which expands our platform’s footprint to cover the three fastest-growing locations in the region — Indonesia, Singapore and Thailand,” Yuen added.

“The platform will support the digital transformation needs of customers wanting to deploy into Indonesia, and Indonesian businesses looking to grow beyond the country. We look forward to deepening our longstanding collaboration with Telkom to capitalise on the favourable trends and tremendous market opportunity.”

According to Ririek Adriansyah — CEO of Telkom — the business is currently going through a period of data centre consolidation to “answer the challenges of digital transformation”.

“The regional data centre platform is a continuation of this data centre consolidation strategy and demonstrates our commitment to respond to customer needs and capture opportunities that will pave the way for our company to become a data centre player on a global level,” Adriansyah stated.

“These efforts require strategic partnerships with operators who have proven capabilities and track records. With its strengths and experience, Singtel is one of the strategic partners for Telkom in developing this regional data centre business.”

As part of the alliance, Singtel and Telkom will also jointly explore a fixed mobile convergence strategy for subsidiary Telkomsel which will see an integration of its mobile business with Telkom’s consumer fixed broadband business.

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