Tiếng ViệtWhile Vietnam remains small in scale and lags behind other markets, it holds significant potential and has ample room for data center (DC) development. Vietnam also has some factors, including land availability, market gaps, construction costs, electricity, and labor , which are all more favorable compared to other markets.
On June 26th, 2024 in Ho Chi Minh City, Viettel IDC organized Data Center & Cloud Infrastructure (DCCI) Summit 2024 with the theme “Developing the Sustainable Future”.
Mr. Hoang Van Ngoc, CEO of Viettel IDC, noted: “A decade ago, I read a science fiction novel predicting AI’s evolution through four generations. The second generation is predicted to be GenAI today,which means Generative AI. The third is expected to combine human and machine interactions, while the fourth sees AI dominate the Earth. By 2024, 50 percent of forecasts in the book has become reality. GenAI represents the pinnacle of this explosion and embodies great expectations.”
Mr. Ngoc also mentioned Elon Musk’s pioneering brain chip implants as a significant step toward human-machine hybrids. In the near future, the world may face challenges from AI dominance.
In this technological evolution, data serves as the backbone, with DCs playing a crucial role in managing and storing vast daily data volumes. DCs and cloud computing drive societal advancement and significantly impact the economy.
DCs directly and indirectly impact the economy
At the conference, Mr. Hoang Van Ngoc, CEO of Viettel IDC, introduced a fresh perspective on the economic efficiency of Data Center and Cloud Computing services. He stressed that DCs are seen as small investments that yield substantial value, boosting the economy with impressive figures.
Recent studies have shown that Dcs make significant contributions to the global economy, impacting the GDP of each country. Additionally, DCs indirectly promote environmental growth. Currently, major global DC service providers are focusing on using renewable energy, with Google being a prime example.
Google’s projects have spurred numerous initiatives in renewable energy, such as signing a $2.1 billion contract to use wind energy for its DCs. The DC industry also generates and drives supply chains, including construction, real estate, equipment, transportation systems, and data services, including storage, collection, preservation, management, and distribution.
According to Mr. Ngoc, this is evidenced by Big Tech, including Apple, Microsoft, Meta, and Amazon owning the largest share of global DCs and submarine communications cable cables. The market capitalization of these companies is equivalent to the GDP of developed countries such as South Korea, Canada, and Italy.
These tech giants currently control 80% of the global DC and submarine cable capacity, exerting significant influence on the global economy.
In Singapore, the potential and strong impact of DCs have led the Singaporean government to amend cybersecurity laws, categorizing DCs and cloud infrastructure as critical infrastructure for stricter oversight of service providers.
“All this information shows how seriously the Singaporean government views the DC industry and its crucial role in Singapore’s economy,” said CEO of Viettel IDC.
“I firmly believe that DCs will play an increasingly important role, as today’s economy is all about the ‘Tech of Everything’,” Mr. Hoang Van Ngoc noted. “Everything revolves around technology and data, which increases the demand for data storage.”
Vietnam has significant potential and ample room for development
Thus, the DC and cloud computing industry not only provides crucial infrastructure for businesses and organizations—from data storage, and computing, to online applications and services—but also drives digital economy development, contributing significantly to each nation’s economy and society.
The Asia-Pacific region is witnessing robust expansion in the DC market. Vietnam, as an emerging market, still lags in DC infrastructure compared to other regions.
Nevertheless, notable DC projects have emerged, with expectations of continued international investment in Vietnam’s data center sector, intensifying market competition and service diversification. The increasing demand for DCs in Vietnam reflects the trend towards digitalization and the adoption of artificial intelligence (AI).
Across the Asia-Pacific region, a 1% increase in Cloud Adoption contributes to a 0.07% growth in GDP on average. In Vietnam, this figure corresponds to an average $6 million increase in cloud consumption costs contributing an additional $134 million to the country’s GDP.
According to Mr. Hoang Van Ngoc, despite Vietnam’s smaller scale and slower pace compared to many other markets, it possesses significant potential and ample room for development. Vietnam is among the top 10 emerging countries globally in terms of land availability, market gaps, construction costs, electricity, and labor, all of which are more optimized than in other markets. With lower average land costs for DCs compared to other regional countries, Vietnam is considered to have substantial development potential.
Driven by increasing domestic demand and government initiatives, Vietnam’s cloud market is forecast to reach 1.2 billion USD, with an average annual growth rate of about 19%. Moreover, the development of the submarine communications cable is a prerequisite and crucial for the growth of the DC and cloud sectors.
In an ideal scenario with high Internet penetration and usage rates among the population, the contributions of cloud computing and DCs to the economy will further increase. Vietnam has significant potential to achieve milestones compared to South Korea and Singapore./.
Cre: ictvietnam.vn
