September 25-26, 2024 The Wynn Las Vegas, NV More information

Q2 2022: APAC Infrastructure Quarterly Report

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Executive Summary

The infrastructure services market in APAC continues to face challenges amid the uncertainty of the current macroeconomic and geopolitical environment. Growth has slowed for the China-based clouds and this has created some headwinds for data centre colocation operators. Meanwhile, the self-build model has emerged as a viaible strategy in certain markets and this will impact growth trajectories and strategic directions.

While demand has slowed and challenges have both emerged and persisted, there are still plenty of reasons to remain optimistic. Platforms like ByteDance are set to drive demand for colocation, and an emerging group of subscale cloud, CDN and edge computing providers continue to push into the region. This is all happening at a very early stage of development and presents plenty of long-term upside to tap into.

The APAC region’s rapid adoption of cloud has been driven by some unique dynamics. Social media and e-commerce usage is happening at unprecedented levels, driven by favourable demographics and a strong penchant for mobile device usage. Meanwhile, emerging areas of growth that will drive infrastructure demand, such as gaming, VR and the metaverse, seem to be setting up to follow a similar pattern. There are early signs that the region is ahead of the curve here and this will inevitably translate into demand for infrastructure.

Across the APAC region, Southeast Asia remains a hotspot, but markets like Seoul and Mumbai are quickly hitting their stride. And in mature markets like Japan and Australia, talk has shifted from establishing a second hyperscale market to trying to identify a third.

This report takes a closer look at the most noteworthy themes and developments that took place in the infrastructure services market in 2Q22. It is a regional supplement to Structure Research’s other quarterly update reports.