Hong Kong has long been considered a key gateway to mainland China and is home to many global corporations. For Equinix, Hong Kong is one of our most vibrant markets in Asia-Pacific. According to the latest Global Interconnection Index (GXI) Volume 3, the city is expected to see the second fastest interconnection bandwidth growth in the region, with a huge increase of 55% compound annual growth rate (CAGR) between 2018 and 2022.
With Hong Kong gearing up for the rollout of 5G and with its smart city development well underway, burgeoning innovations are expected to unleash a major wave of digital connectivity this year. Recently, our Managing Director of Hong Kong, Larry Tam, sat down with me to talk about the Hong Kong data center landscape and how Equinix supports clients on their digital journeys into this new and exciting decade.
Jeremy Deutsch (JD); Larry Tam (LT)
JD: Let’s start by talking about you. You are an industry veteran with more than 30 years’ experience. Could you tell us more about yourself?
LT: I have been in the ICT industry for over three decades and it has been an exciting ride for me because it has been a period of unprecedented disruption and transformational change.
Much of my early career was spent in Juniper Networks and Level 3 Communications. Following that, I joined Brocade as the Managing Director for Hong Kong and Macau, where I was responsible for driving the overall business growth and performance in the two markets.
Two years ago, I got the chance to join Equinix as Vice President of Sales & Marketing of Hong Kong to oversee the sales and marketing function. Then I moved to my current role in 2019 to lead business strategy, sales and operations in the market.
JD: What inspires you the most about working at Equinix?
LT: Ever since I joined Equinix, I have relished the collegiate atmosphere and the Magic of Equinix. Everyone enjoys coming to work and is proud to tell people they are part of Equinix. We share the same value of “Putting the customer at the center of everything we do” and it motivates me and the team to work as one.
JD: What kind of leader do you aspire to be?
LT: I like hanging out with the team, with a focus on clear communication and integrity which I feel is essential to have among the team. I am always appreciative of great teamwork, which I believe is what makes us great.
My favorite cartoon character is Doraemon and I want to become ‘him’ for my team; someone who always comes up with instant and effective solutions for them when they face problems. The team is my Nobita Nobi, and with my “treasure bag,” I am always ready to work with them to create greatness together.
JD: As the leader of Hong Kong, what do you think about Hong Kong’s data center landscape? How are interconnection demands likely to evolve in the face of the territory’s digital transformation?
LT: It’s clear to me that demand for data centers and interconnection in Hong Kong is driven by a number of factors – a robust network infrastructure, reliable energy supply, shelter from natural disasters, and geographical proximity to mainland China. The city’s thriving financial services industry is also increasingly demanding data-center services due to tight industry requirements around security and resilience.
In recent years, the government has also launched a series of initiatives to accelerate the city’s digital transformation, including Smart City Blueprints and Fast Payment Systems. So, it’s not surprising that analyst firms like IDC are predicting that, by 2021, digital transformation will add an estimated US$9 billion to Hong Kong’s GDP.
For this transformation to work as it should, it needs secure, reliable, real-time data transmission and analysis. So overall, I see digital transformation in Hong Kong fueling massive demands for interconnection.
JD: Hong Kong will be one of the first cities in Asia-Pacific to officially launch 5G in 2020. What’s your expectation about 5G and how will it impact interconnectivity?
LT: In my opinion, 5G networks will revolutionize business operations and we anticipate 5G services to kick off in Hong Kong as early as the middle of 2020.
Fast, reliable, and always-on networks can stream massive volumes of data, all of which require processing and analyzing at the edge. This will soon happen within a matter of seconds. We expect to see a surge in demand for a reliable, accessible connection of network nodes to support an ever-growing volume of data and traffic generated in multiple locations.
JD: Hong Kong is the region’s financial center. How will technology and data centers help the city maintain its position as one of the world’s leading financial hubs?
LT: The last few years have been an exciting time in terms of innovation in Hong Kong. We have seen the Hong Kong Monetary Authority announced a total of eight virtual banking license recipients in 2019 and ZA Bank had also become the first virtual bank to launch its operations in January 2020. Similarly, the Insurance Authority granted its first virtual general license in October 2019 to Avo Insurance. These moves are a strong indication that Hong Kong regulators are ready for transformational financial services.
With user experience being key to driving business success, financial players are evolving to meet customers’ needs through the latest technologies, including data analytics, AI, and RPA. One of our key business pillars at Equinix – our fintech ecosystem – can enable more sector players to deliver an uninterrupted experience for their users.
As a case in point, last year, the Hong Kong Exchanges and Clearing Limited selected an Equinix International Business Exchange™ (IBX®) data center in Hong Kong to enhance the resiliency of its corporate IT infrastructure. Because we host the largest multi-asset class electronic trading ecosystem in the world, users can trade across equities, commodities, foreign exchange, and fixed income markets. Its work like this that proves to me that what Equinix does is truly able to have an impact in the markets we operate in.
JD: What does the future hold for Equinix Hong Kong?
LT: Last year, we announced the expansion of two of our IBX data centers, HK2 and HK4, in Hong Kong. Following these expansions, which are expected to complete by the first half of this year, we will add a total of 1,500 cabinets of capacity, creating an additional colocation area of nearly 4,800 square meters.
Now we operate five IBX data centers in Hong Kong. With the addition of the new phases, we will have a total colocation space of about 31,300 square meters, which is a total increase of 17%. The five data centers are business hubs for more than 505 companies, where our customers can interconnect directly to other customers and partners in their digital supply chain.
Spearheading interconnection in Hong Kong
I hoped you have learnt more about Larry and his insights into the Hong Kong data center landscape. There is no doubt that Hong Kong will continue to accelerate its digital journey in 2020 and that interconnection has never been so important as it is now. Stay tuned for the next interview in the ‘Getting to Know…’ series.
Do you want to know more about the interconnection landscape in Hong Kong and seize emerging opportunities? Download our latest Global Interconnection Index here to learn more about the latest trends and how Equinix can help you capitalize on them.
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Ever since I joined Equinix, I have relished the collegiate atmosphere and the Magic of Equinix. Everyone enjoys coming to work and is proud to tell people they are part of Equinix. We share the same value of “Putting the customer at the center of everything we do” and it motivates me and the team to work as one.