Photo courtesy of jjcb
The Asia-Pacific data center markets enjoyed a year of robust growth and 2013 is poised to be another season of data driven acceleration. Singapore has been uniquely placed to take advantage of the data surge. The new data stimulants of cloud services, mobile content, personal content, social media and the big data demands of MNC driven sectors like financial services are set to take us to new data consumption highs in 2013. We spotlight the key themes facing the Singapore market for 2013.
1- Data protection
The Singapore government has committed heavily to the issues surrounding security and regulation for storing structured and unstructured data. Data protection will be a key theme in the year ahead. Singapore has implemented a lot of law and regulation around how this data is housed which are far more advanced than other markets and may also serve to create benchmarks that others will follow.
A regulatory trend is emerging across Asia-Pacific where data housing must be localized. The financial services sector in Indonesia has recently moved in this direction with more sectors to follow. Countries have different star verticals and they want to protect them accordingly. Data center operators that can invest locally will be well placed to be the heroes in the battle for data protection.
Singapore is working towards providing an environment where data is safer and is producing rules and regulations that protect local investors. It is the government’s way of using the carrot rather than the stick.
2- Geography and digital destiny
Singapore’s unique position as a regional subsea cable hub means that geography will always support digital expansion. Singapore enjoys the established position of being one of the biggest ports in the world for trade and for digital sailing. This is not just an efficient way to distribute traffic through the region but also the safest in terms of insulation from natural disasters including earthquakes and tsunamis.
In the last 24 months we have seen a shift in the types of investors in those cable consortiums. What was once the dominion of pure telecommunications players is now being occupied by content providers like Google, Facebook and Yahoo who are investing heavily in new cable projects. As bandwidth demands accelerate, the new protagonists driving the subsea cable investment market will emerge from the digital content sectors.
3- Singapore’s data honey hub
The Singapore government knows how to attract the Queen Bees of the economy. The strategy is simple, by attracting the big players in key verticals like the finance sector, the smaller competitors inevitably follow. As the leading businesses from every vertical gravitate to Singapore so does the demand for data housing. The strength of the Singapore government is that the country is run like a business with every department focussed on attracting high value businesses and services into Singapore. The Singapore government’s incentives can be indirect or direct ranging from tax incentives to low cost industrial rate land allocation, to creating the right university courses to stimulate the talent pool for IT graduates in demand.
4- Skills pipeline
The Singapore government is constantly ‘mapping’ the needs of emerging business with university courses to ensure that fresh graduates have the opportunity to learn the skills that are in demand and will be part of the next wave of growth. Producing the right talent for emerging industries is core to the Singaporean agenda. Looking ahead we will see an increase in the talent pool with local universities producing more graduates in electronic engineering and cloud specialists.
Developing countries are increasingly looking to Singaporean executives to add value in their workforce to run their companies. Singapore has evolved from being manufacturing focussed to a technology and biotech center of excellence. The country is now exporting its talent in terms of manufacturing to the emerging markets of China and India and its executive and managerial talent is now highly sought after regionally.
5- Data growth gets deeper than cloud demand
While the cloud is a big contributing factor to data center demand, other drivers that will remain key in the year ahead include mobile. The increasing use of mobile devices means that a constant stream of structured and unstructured data is being created, contributing significantly to the rise in traffic.
The next evolution will be the mining of this fixed and mobile data in more pervasive ways. Data mining will emerge as the dominant force for market analysis, decision-making and trend forecasts. This will permeate through all levels from government to corporate and consumer behavioural trend mapping.
6- The ecosystem essentials will be premium
The biggest challenge in the data center sector is the availability of the appropriate infrastructure to run our businesses and that is power, clean water and connectivity.
Keeping power costs down is a constant challenge in the Singapore market as it is a net importer of energy. But conversely other markets in the region are constrained by even getting enough power to support their data center needs.
This is why running a data center as a viable ecosystem is essential, it is not just about being a space and power provider but providing a conduit between all the elements required including connectivity to wherever is needed.
7- The mobile battle will continue
The rise and growth of the mobile app economy will be unstoppable in the year ahead but the battle across competing standards will also continue without a resolution. While competing operating systems will jostle for flavour of the month, it will take years for any kind of consolidation to take place. The battle will not be won this year and ultimately may become more complicated. Wi-Fi will also continue to embed itself in every device and don’t be surprised if cameras enjoy liberation from the handset and vice versa. 2013 will be the year that every camera will have its own Wi-Fi access and will not need a mobile conduit for connectivity.