Oracle and Google are the latest technology companies to invest in cloud infrastructure in Southeast Asia to drive AI growth in the region, amid a rush by companies to use the groundbreaking technology.
Earlier this week, Oracle said it planned to invest more than US$6.5 billion to open a public cloud region in Malaysia.
This gives customers access to the company’s generative AI agents with retrieval-augmented generation (RAG) capabilities, as well as accelerated computing and generative AI services to help keep sovereign AI models within country borders.
Customers will also be able to tap on the Oracle Cloud Infrastructure Supercluster, the largest AI supercomputer in the cloud.
Fellow Big Tech firm Google also plans to build more data centres and cloud regions in Malaysia and Thailand, with planned investments of US$3 billion over the next six years.
“Rapidly growing demand for AI services prompts calls for more data centres that store large amounts of data and computational power to train and deploy AI models,” said Franco Chiam, vice president, cloud, data centre and future digital infrastructure, Asia Pacific, IDC.
IDC expects Malaysia’s public cloud services market to grow by 27.2 per cent at a compound annual growth rate from 2022 to 2027.
“The upcoming Oracle cloud region in Malaysia, therefore, signals the country’s potential to become a hub for technological innovation and growth in Southeast Asia,” said Chiam.
Other technology companies have also ramped up their cloud and AI investments in the region. Earlier in May, Microsoft announced plans to invest US$2.2 billion in Malaysia over the next four years for cloud and AI-led digital transformation.
Microsoft also plans to invest US$1.7 billion in Indonesia over four years to build new cloud and AI data centres and roll out AI training and skilling initiatives for 840,000 Indonesians.
Beyond Southeast Asia and in the larger Asia-Pacific region, Microsoft will invest US$2.9 billion over the next two years to expand its hyperscale cloud computing and AI infrastructure in Japan.
Earlier, in May this year, Amazon Web Services (AWS) announced plans to invest another US$9 billion over the next five years to expand its cloud infrastructure in Singapore.
Also in May, Amazon announced plans for US$12.7 billion cloud investment in India by 2030 and to establish a new AWS infrastructure region in Taiwan by early 2025.
According to Astute Analytica, the Asia-Pacific cloud infrastructure market is experiencing exponential growth, with a forecasted 25.93 per cent compound annual growth rate for 2024 to 2032 that will hit a market valuation of US$593.7 billion by 2032.
