Week in Review: Data centers, unsung heroes and digital economy drivers

By A. Asohan January 18, 2013

Data centers are a lynchpin of the Digital Economy
Yet, for most of us it’s out of sight, out of mind

Week in Review: Data centers, unsung heroes and digital economy drivers THE people behind the two-day Second International Datacentres Malaysia Summit in Kuala Lumpur (KL) earlier this week must have been anxious – it was 9am on the first day, when the welcome address was supposed to be delivered, and only about 20% of the seats had bums on them.

KL traffic, Malaysian punctuality – place the blame where you will. Half an hour later however, by the time the summit kicked off properly, the hall was packed.

For a while, it seemed that this particular industry was going to be neglected once again. Out of sight, out of mind. Throughout the day, more than one speaker or panelist alluded to that bugbear of the data center industry: They’re the guys nobody thinks about, as long as things are running smoothly. Once the you-know-what hits the fan, however ….

The summit was organized by UK-based consulting firm BroadGroup and hosted by Multimedia Development Corporation (MDeC), whose chief executive officer Datuk Badlisham Ghazali, at a different event last year, had noted that the industry was the foundation of all the other sexy, technology trends we keep hearing about: BYOD, mobile Internet access, the cloud and so on.

Week in Review: Data centers, unsung heroes and digital economy drivers Yet nobody really thinks about them. Data centers are treated as if they are the godowns of the Information Age. Just facilities to store stuff in. Never mind if that stuff is those YouTube videos we all enjoy; or the data needed to process all our e-shopping transactions. We just don’t think about it.

The fact is, the industry is a lynchpin. Unusual for me to quote a politician, but Datuk Seri Dr S. Subramaniam, Minister of Human Resources, had it absolutely right when he said in his speech, “a thriving data center industry in Malaysia will also provide the critical infrastructure needed to make the Malaysian digital economy work.”

Yup, it’s that important, which is why the Malaysian Government wants to make Malaysia a “world-class” data center hub, and has declared this aspiration as an Entry Point Projects (EPP) of the Economic Transformation Program (ETP), which itself aims to transform Malaysia into a “high-income” economy.

Data centers sit under the Business Services NKEAs (National Key Economic Areas) of the EPT, with Subramaniam serving as chairman of that steering committee.

Perhaps being unsung heroes helps. This particular EPP is unique in the sense that it is the only one I know of that has actually scaled down its target numbers. Among the KPIs (key performance indicators) was to see 5 million sq ft of net lettable space be available by 2020; we’ve only achieved around 500,000 sq ft.

The fact is, technological improvements and increasing efficiencies in the industry have de-emphasized the need to expand physical space. There are a lot of innovations happening in this space, especially in its green IT aspect.

The surprising thing is that when the Government said the 5-million target was not set in stone, many ETP observers and critics of the Government – always looking for political ammo -- did not notice, or chose to let be.

Which I say is a good thing. Scrutiny and critique of government projects and programs are needed in any democracy, especially in a stunted one like Malaysia’s, but we have been going overboard in the last few years. In this one case, I’d say give them the space to align with the actual market reality and pace of technological innovation.

The bad thing about being hidden however is very few notice your successes. Another KPI was data center industry revenue, targets in which MDeC has reported have been surpassed: RM320 million (US$106 million) in 2011, on track to report RM400 million (US$133 million) or higher for 2012, and confident of hitting RM480 million (US$160 million) this year.

Up, up and up, but nary a whisper heard. Poor data center players. Digital News Asia salutes you.

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