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Data sovereignty drives new demand for Asia Pacific

Governments across the globe have been taking steps to secure data and are setting out rules around its exchange and storage.



“Data is the new oil.” While that analogy may not be perfect, recent events underscore just how valuable particular types of data are in the information age.

Governments across the globe have been taking steps to secure data and are setting out rules around its exchange and storage.

Generally, they would also like to ensure that data of their local consumers are being stored in-country, within their jurisdictions.

Recent scandals involving the abuse of data to influence public opinion are likely to drive further data legislation, and the demand for secured data centre facilities.

Privacy laws directing the flow of data

On 25 May the General Data Protection Regulation (GDPR) went into effect. The intent of GDPR was to give private EU citizens more control over how and whether their personal data is used by companies.

But these new laws have global reach as they will determine whether personal data can be transferred outside of the European Union (EU). Data originating in the EU can only be transferred to countries outside the union if their data protection laws are deemed adequate.

Data sovereignty drives demand for emerging markets

Data sovereignty is also influencing the movement and placement of data here in Asia Pacific. For example, in Oct 2017 legislation in Indonesia by the Minister of Communication and Informatics – Regulation No.20 of 2016 (Data Protection Regulation) – mandated data related to public service activities be stored in onshore data and disaster recovery centres.

Commercial banks were immediately impacted by these regulations which meant they had to move their data stored overseas to data centres in Indonesia.

More recently, the Ministry of Information and Communication in Vietnam enacted cyber security laws which require global tech firms to store “important” data on users in Vietnam locally.

Companies like Google and Facebook will be required to store their data in Vietnam and open offices there. The new law goes into effect on 1 Jan 2019 and it is highly likely we will see another surge in data centre demand.

Data legislation creates new opportunities

Demand for data centres continues to grow at a rapid clip. Adoption of the public cloud by enterprises and growth in the number of connected devices, and the growing volume of data they collect, are two key forces set to drive data centre take up, in both primary and emerging markets, over the near and medium term.

The enactment of new data protection laws are likely to further stimulate the growth of the industry in emerging markets.

We have already seen this in Indonesia with major data centre providers beginning to expand their local facilities. This demand will not only create opportunities for local data centre facilities but it will also create opportunities for operators to enter emerging markets where good quality supply is limited.

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