Tencent Cloud pledges SEA expansion with launch of Indonesia data centre

Chinese internet giant launches its first data centre in Indonesia, with plans to open a second one in the Southeast Asian market as well as Thailand and South Korea within the year, as it looks to build out its cloud footprint across the region.

Tencent has opened its first data centre in Indonesia, with plans to open a second within months alongside new sites in other Asian markets including Thailand and South Korea. The Chinese technology giant says the investment is part of an "aggressive" plan to build out its infrastructure in the region and tap growing cloud demand. 

Located in Jakarta's central business district, the data centre boasts two utility power lines and 2N redundant transformers as well as N+1 redundant diesel generator with capacity to support up to 72 hours at full load. Tencent's cloud coverage currently encompasses 27 regions and 61 availability zones, most of which are located in China and the Asia-Pacific, and includes markets such as Singapore, Tokyo, Mumbai, Seoul, Moscow, Toronto, and Frankfurt. 

The tech vendor operates more than 40 data centres in China alone, where its cloud business debut was a decade ago. Its international business was launched some three years ago across various regions and currently operates 19 to 20 data centres outside its domestic market. 

Lack of credible local providers, knowledge hinder APAC cloud adoption

Misinterpretation of regulatory requirements and a lack of local talent and knowledge about the different risk profiles are hindering wider deployment of cloud among Asia-Pacific enterprises.

Read More

It added a second data centre in South Korea early this year and, last month, announced plans to launch its first such facility in Bahrain by year-end to support the Middle East and North Africa region. 

The latest site in Jakarta would better facilitate access to data and applications for customers in the region and support Indonesian organisations in their digital transformation efforts, said Poshu Yeung, Tencent Cloud International's senior vice president, in a call with ZDNet. He added that there had been strong online demand across various verticals including financial services, e-commerce, games, education, and media and entertainment. 

Tencent itself had seen significant growth for its online services in Indonesia, where its JOOX music streaming app was the second most popular in the country, Yeung said. It also launched WeTV last year, with plans to create more local production this year, and would soon introduce more games for the local market.  

Strong demand for its consumer services had further underscored the need for Tencent to build its own data centres in Indonesia, he said, adding that a second data centre would be operational in the country likely in August. This marked the first time the company was launching two sites in the same market in the same year, he noted. 

It also should signal how "aggressive and invested" Tencent was bolstering its presence in Indonesia, which he said was one of the leading growth markets for cloud in Southeast Asia. This demand was also evidence in other markets in the region as well as the wider Asia-Pacific, where it saw significant growth last year, he added. 

This was despite the fact that the vendor last November had reported "lingering impact" of the global pandemic on its cloud revenue during its third quarter earnings. Tencent then had pointed to delays in project deployment and new customer signups as well as "non-recurring adjustments" to some IaaS (infrastructure-as-a-service) contracts, which led to a lower growth from its cloud and other business revenue.

Asked to elaborate, Yeung said 2020 was a tough year for many businesses but the cloud market was one of few to see robust growth--fuelled by accelerated digital transformation initiatives--not just for global players, but also Tencent. The vendor's international cloud business last year had clocked triple-digit growth, he said, noting that this upward momentum was expected to continue this year.  

He revealed that Tencent would soon launch a second data centre in Thailand as well as in Japan in June. 

Apart from supporting its own business and local enterprise customers, its data centre buildout across the region would tap growth potential from Chinese enterprises looking to expand overseas as well as international companies investing in the local markets. 

ZDNet asked if he saw fellow Chinese cloud vendors such as Huawei and Alibaba Cloud, which also were eyeing growth in Southeast Asia, as bigger rivals than global cloud players such as Google, Amazon Web Services, and Microsoft. Yeung noted that the cloud business remained sizeable and there was room for several major players. 

He added that cloud providers also often worked together, since enterprise customers increasingly were looking to adopt multi-cloud deployments as part of efforts to avoid being locked into one cloud vendor. 

"So there are clear opportunities for everyone," he said, noting that Tencent aimed to offer added value with SaaS products developed for verticals, such as financial and fintech, media, retail, and healthcare. 

The vendor also had a wide ecosystem backing its cloud infrastructure and services, including its WeChat platform, he added.

RELATED COVERAGE