Singtel deepens collaboration with Indonesia's Telkom

• Marks significant step in advancing data centre strategy
• Will explore a fixed mobile convergence strategy for Telkomsel 

Singtel and its Indonesian partner Telkom, the parent company of Singtel's regional associate Telkomsel, have signed two memoranda of understanding (MOU). 

In a statement, Singtel said the first of the two MOUs covers collaboration in the area of data centres, which marks a significant step in advancing its regional data centre strategy. 

The second MOU involves a collaboration to support Telkomsel’s transformation into Indonesia’s leading consumer fixed broadband and mobile operator through a fixed mobile convergence strategy with Telkom, the telco added. 

To capture growth opportunities arising from the unprecedented digitalisation and cloud adoption in Asean, Singtel said it has focused on establishing a data centre platform that will work with partners to build and acquire data centres in the region. 

It added that Asean has been experiencing robust data centre growth and the Singapore and Indonesia markets are projected to more than double in size, accounting for over 60% of regional growth by 2025.

As strategic partners for over two decades, this move into data centres expands on the close collaboration between Singtel and Telkom to build out Indonesia’s mobile communications and digital infrastructure, the telco said. 

Singtel group chief executive officer (CEO), Yuen Kuan Moon (pic) said as businesses rapidly digitalise, and with the growing adoption of IoT, artificial intelligence and 5G across the  region, demand for high-quality data centres is on the rise. 

“This partnership with Telkom is an important step for our data centre strategy, bringing together the prime assets, expertise and networks of two market leaders in data centre operations in Indonesia and Singapore,” he said.

“As the largest digital economy in Asean, Indonesia is a strategic data centre market which expands our platform’s footprint to cover the three fastest-growing locations in the region – Indonesia, Singapore and Thailand,” said Yuen.

He added that the platform will support the digital transformation needs of customers wanting to deploy into Indonesia, and Indonesian businesses looking to grow beyond the country.

Therefore Singtel looks forward to deepening its longstanding collaboration with Telkom to capitalise on the favourable trends and tremendous market opportunity, he said.

Meanwhile Telkom CEO Ririek Adriansyah said Telkom Group is currently consolidating its data centre business to answer the challenges of digital transformation. 

“The regional data center platform is a continuation of this data center consolidation strategy and demonstrates our commitment to respond to customer needs and capture opportunities that will pave the way for our company to become a data center player on a global level. 

“These efforts require strategic partnerships with operators who have proven capabilities and track records. With its strengths and experience, Singtel is one of the strategic partners for Telkom in developing this regional data center business," Adriansyah said.

According to Singtel, both companies will also collaborate on development opportunities and will explore bringing third-party investors or partners into the platform.

Besides Indonesia, Singtel has set its sights on the Thai data center market, it said.

In February, the company signed a joint development agreement with Gulf Energy and Singtel's regional associate AIS to start developing data centers in Thailand, and this new joint venture will be launched soon.

Singtel and Telkom will also jointly explore a fixed mobile convergence strategy for Telkomsel which will see an integration of its mobile business with Telkom’s consumer fixed broadband business. 

By combining the strengths of the two companies, Telkomsel will be able to enjoy significant synergies and enhance its leading position in the market with converged solutions that will give customers the best digital experience, the companies said.