Tencent Is Proof Of Another Magnitude Of Indonesia's Internet Data Business

Photo illustration of Tencent Internet Data Center (Source: Antara)

JAKARTA - Chinese tech giant Tencent Holdings is stepping up its stakes in the global competition for Asia's burgeoning cloud services market. Tencent is rumored to open two data centers in Indonesia by the end of this year.

In addition to Indonesia, Tencent Cloud International Senior Vice President Poshu Yeung said most data centers will be built in other Asian countries, such as South Korea, Thailand, and several Middle Eastern countries.

Reporting from Nikkei Asia, Yeung said that this was part of Tencent's grand plan to operate 20 data centers outside China. The first batch is planned to be launched in Europe and the US.

However, as tensions between China and Western countries escalate, Tencent decided to add 30 percent to 50 percent more data centers later this year, mostly in the Asian region.

Yeung said that during the COVID-19 pandemic, Asia has experienced rapid growth in internet activities, in terms of video conferencing, e-commerce, online education, games, and streaming.

To answer that, other major tech companies, such as Facebook, Amazon, Microsoft, Google Alphabet, to Alibaba Group are racing to build data centers to monetize opportunities in the digital world.

According to property consultant CBRE, investment in data centers in the Asia Pacific quadrupled to USD 2.2 billion. That figure is much larger than the one recorded in 2019.

Indonesia's greenest field

Among the many Asian countries, Indonesia is one of the fields with the greenest grass. Google, Microsoft, Facebook, and Amazon have first announced plans to build their first data centers in Indonesia.

Meanwhile, Alibaba Group has opened two data centers in Indonesia. They are now planning for the third. The sheen is inseparable from the fact that Indonesia is the country with the fourth-largest population in the world, with 270 million inhabitants.

"I think Indonesia is actually one of the fastest-growing cloud business markets in Southeast Asia", Yeung said.

President Joko Widodo (Source: Setpres)

"This is the first time we've launched two data centers in the same year in the same market. It shows how much we're committed to and how much we value the local market".

Back to Tencent. The new data center they will build in Jakarta will support a variety of industries, including entertainment, gaming, financial services, e-commerce, and education.

Data centers are important instruments that help accelerate data processing. For a city known as a business hub, the existence of data centers will open up opportunities for companies to make services more competitive than they have to use cloud facilities overseas.

"By setting up our data center, our presence will help us get more local businesses", Yeung said.

Tencent as a big cloud player

Photo illustration of Tencent Internet Data Center (Source: Antara)

Tencent is the number four player in the cloud market in the Asia Pacific. In 2019, research firm Gartner listed, above Tencent, Alibaba, Amazon, and Microsoft.

In Indonesia, it has locked down several companies, including Jakarta-based Bank Neo Commerce. They are certain to use Tencent's cloud services to support digital banking services.

Yeung is enthusiastic about the cooperation. He believes financial technology is a huge potential in Southeast Asia. Yes, although Yeung also insists Tencent does not plan to run their own digital banking services.

The Shenzen-based company is also rumored to have spoken with the Indonesian government. They stated that they are ready to support public services in terms of data services.

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