As the economy expands and more companies adopt new technologies to streamline operations and improve efficiency, data centers in Vietnam are seeing a surge. The sector is just beginning to develop and infrastructure must be able to grow quickly to meet the demand. It is essential that the providers provide the reliability of power supply and be aware of the complex regulatory landscape of the country.
The country had strict rules regarding foreign ownership of cloud and data businesses until last week. The new Law on Telecommunications eliminated the 49% cap for foreign ownership, allowing the full ownership of data as well as cloud companies by foreign investors. This is a great change for the industry, since it is likely to boost foreign investment and improve the tech capabilities of the country.
One company that is taking advantage of the change in policy is Google, which is weighing the possibility of establishing a “hyperscale” data center in Ho Chi Minh City, sources close to the plans said. The source didn’t specify the amount of the investment. It would be significant for the data center industry in Vietnam. This would be the first time a large U.S. technology company invests in Vietnam. Large data centers usually prefer to build their facilities in rival countries due to security concerns and high operational costs.
Alibaba the Chinese company is also constructing data centers in Vietnam. This is to comply with the local laws that require businesses to store local data. Alibaba currently operates data centers owned by telecommunications firms Viettel and VNPT to fulfill the requirement.
Ho Chi Minh City, Hanoi and other cities are becoming hubs for cloud service providers. Many international operators have invested large sums in the region, including NTT, Edge Centres, and STT Global Data Centers (STT GDC).
Vietnam is a fantastic choice for businesses that are seeking to invest in data centres. Its abundant workforce and competitive pricing when contrasted with other countries, and the favorable policies of the government make it a great place to make that investment. But as the market expands and the competition increases, it’s essential to know the risks and rewards of this lucrative industry to maximize their returns.
Data centers consume a lot of energy. To meet the growing demand, providers need the right infrastructure. This includes ensuring a stable and reliable power supply, making sure that the environment for data storage is secure, and providing secure connections. These issues can be addressed with the proper planning and execution but they must be carefully evaluated against the potential benefits investing in this sector could bring. For instance a data center with 50 megawatts of power could cost between $300 million and $650 million to construct in Vietnam. This is a substantial portion of an organization’s IT budget. It is crucial to weigh the pros and the cons before making a final decision. Contact us if you need assistance with your data center project.