When opened, the new IBX data centre in Johor will increase Equinix's total global footprint of more than 245 data centers across 71 metros and 32 countries
Digital infrastructure company Equinix has entered the Malaysia market, outlining plans to build a new International Business Exchange (IBX) data centre located in Johor, called JH1.
With an initial investment of approximately $40 million, JH1 is scheduled to begin operations in Q1 2024, providing 500 cabinets and 1,960 square metres of colocation space. The world-class IBX data centre will support Malaysian companies and multinationals doing business in Malaysia with access to Platform Equinix to bring together and interconnect the foundational digital infrastructure that powers their success.
Malaysia's digital economy is forecast to reach $34 billion in gross merchandise value by 2025, with the country on course to achieve a digital economy contribution to gross domestic product of at least 25.5% the same year.
Equinix's expansion in Malaysia will unlock opportunities for Malaysian businesses expanding internationally and for multinational corporations pursuing growth and innovation in the Malaysian market. Malaysian companies will benefit from the ability to accelerate their evolution from traditional to digital businesses by rapidly scaling their infrastructure, easily adopting hybrid multi cloud architectures and interconnecting with strategic business partners within the Platform Equinix ecosystem of more than 10,000 customers.
We are looking forward to working together, in transforming Malaysia into a digitally driven, high-income nation at the forefront of this region's digital economy
Equinix's expansion in Malaysia is in line with the MyDIGITAL initiative launched by the Malaysian government, which aims to provide a blueprint for the country to accelerate growth of digital products and services. Datuk Onn Hafiz Ghazi, Chief Minister of Johor, said: "While the digital economy represents a catalyst for the Malaysian economy, data centres are integral in supporting digital ecosystems and their sustained growth. We welcome this investment by Equinix, along with the global expertise they bring to Johor, as well as the rich digital experiences and outcomes that will benefit this state and the country. We are looking forward to working together, in transforming Malaysia into a digitally driven, high-income nation at the forefront of this region's digital economy."
This expansion marks Equinix's second foray into ASEAN (the Association of Southeast Asian Nations) following the recently announced plans to expand into Indonesia, allowing the company to address digital infrastructure demand critical to the region's digital growth. Jeremy Deutsch, President, Asia-Pacific, Equinix, commented: "Establishing a presence in Johor strengthens Equinix's leadership position in Asia-Pacific within a strategic market such as Malaysia, one of the most requested markets in Asia-Pacific by our global customers. I would like to express our gratitude to the Digital Investment Office (DIO), Invest Johor, and Tenaga Nasional Berhad (TNB) for their assistance and support. We look forward to deepening our collaboration through future expansion, maximising local businesses' digital growth potential with rich digital experiences and outcomes."
JH1, a two-story facility, will be located at Nusajaya Tech Park (NTP) in Iskandar, Johor. It is 15 kilometres from Singapore, allowing the data centre to address excess demand from organisations in the city-state in addition to Malaysian domestic demand.
Equinix also has the option of acquiring additional land in NTP to build a second facility, supporting Malaysia's digital growth aspirations. Companies and multinationals doing business in Malaysia will be able to access Platform Equinix to store and distribute large volumes of latency-sensitive data and applications closer to end users and local markets.
Today, Malaysia is one of the top three colocation markets in ASEAN, with momentum driven by growing demand and investment from hyperscalers and cloud service providers, as well as national policies favourable for digital growth. According to Synergy Research, the Malaysia data centre market is expected to grow at a compound annual growth rate (CAGR) of nearly 10% during 2021–2026.3 This shows the need for increased digital services and data centre services capacity in Malaysia.
As indicated in the Global Interconnection Index (GXI) 2023, organisations are connecting to three times as many business ecosystem partners and metros, consuming more than twice the amount of interconnection bandwidth on average in the past five quarters than in the previous five years. Organisations need access to ecosystems comprising network companies, cloud and system integrator companies, and enterprise customers who can take advantage of a full platform service across a global footprint. The Johor data centre will provide organisations with access to vibrant ecosystems made up of more than 2,100 networks and over 3,000 cloud, IT and system integrator services that Equinix works with globally.