As the economy grows and more businesses adopt new technologies to streamline their operations, data centers in Vietnam are experiencing a boom. However, the industry is in its early stages, and infrastructure needs to grow quickly to meet demand. It’s also critical for companies to ensure reliable power supply and to have a an understanding of the country’s complicated regulatory framework.
The country had strict rules regarding foreign ownership of cloud and data companies until the end of last week. The new Law on Telecommunications eliminated the restriction of 49% for foreign ownership, and allows the full ownership of data and cloud businesses by international investors. This is a great change for the industry because it will encourage foreign investment and boost tech capabilities in the country.
One company taking advantage of the change in policy is Google and is currently weighing the possibility of setting up a “hyperscale” data center in Ho Chi Minh City, a source close to the plans said. The source did not disclose the size of the investment. It could be significant for the data center industry in Vietnam. It would be the first time a big U.S. tech company made an investment in Vietnam, since large data centers usually prefer to build their facilities in countries that are not as affluent due to security concerns and the high operating costs.
Alibaba, a Chinese company is also building data centers in Vietnam. This is in order to comply with local laws that require companies to store local data. Alibaba currently operates data centers that are owned by telecommunications companies Viettel and VNPT to meet the requirement.
The country is a booming location for cloud service providers as Ho Chi Minh City and Hanoi both gaining momentum as data center hubs. Several international operators have already made big investments in the region, including NTT, Edge Centres, and STT Global Data Centers (STT GDC).
With its affluent workforce, competitive pricing when compared to other countries, as well as supportive government policies, Vietnam is a good option for businesses seeking to invest in data centers. However, as the market expands and expands, it is essential that companies understand the risks and rewards of this lucrative industry to maximize their profits.
Data centers consume a lot of energy. To meet the growing demand, providers require the appropriate infrastructure. This includes ensuring a robust and reliable power supply, as well as ensuring that the environment is safe for data storage, and offering secure connectivity. These concerns can be overcome by the right planning and execution, but they must be carefully evaluated against the potential rewards that investing in this sector could bring. For example, a data center with 50 megawatts of power could cost between $300 million and $650 million for construction in Vietnam. This is a substantial portion of a company’s IT budget. It is important to weigh the pros and the cons before making a final decision. Contact us for assistance with your data center project.
