As hyperscale cloud exploded across the APAC region and poured into primary markets such as Singapore, Australia, Hong Kong and Japan, a second tier of markets has been quietly in waiting. Leaving aside China and India, the largest potential market in the region has always been Indonesia and this is embodied in the megacity that is the nation’s capital. Jakarta is at the centre of the national economy and home to the government and all major enterprises. Indonesia is the fourth largest country in the world by population and Jakarta has well over 10 million people.
But Internet infrastructure in Indonesia has not developed along a smooth path. There have been persistent barriers around infrastructure quality, government regulation and the slow development of domestic demand. Broadband access was slow to penetrate the mass market and the iPhone was a late entrant to Indonesia. All this is now changing rapidly. Internet adoption is accelerating, mobile devices are ubiquitous and enterprises are beginning to use various outsourcing models and moving away from traditional on-premise infrastructure. Meanwhile, as more of life moves online, a burgeoning startup community has emerged and Indonesia is now home to a number of tech unicorns.
Much of this online activity is going to end up on hyperscale cloud platforms and this infrastructure will need to be connected to networks and housed in data centres. Colocation is an option that makes a great deal of sense given the difficulty of navigating a developing economy like Indonesia and the need to scale efficiently and in a timely fashion. And therein lies the long-term opportunity. Clouds are going to need copious amounts of wholesale colocation capacity and drive uptake of interconnection services to integrate and scale with cloud services. Jakarta is at the very early stages of what promises to be a long and aggressive build out of hyperscale cloud infrastructure and data centre colocation and interconnection services are poised to be major beneficiaries.
The Jakarta data centre colocation market is still developing and will be worth $215.6m USD in 2020. The sector will grow steadily at a five-year CAGR of 23.7% through 2025. Jakarta is going to be a hyperscale market sooner than later. On a MW basis, total inventory is expected to grow at a five-year CAGR of 23.1%, with the wholesale inventory portion growing at a much higher five-year CAGR of 44.7%.
This report is an excellent resource for any service provider, investor or enterprise end user looking to understand and project the data centre market in Jakarta or find a service provider. The methodology applied continues to be the most robust in the industry. We track supply on a space and power basis, split all the metrics along retail and wholesale lines, and aggregate inventory in multiple tiers according to build status, absorption rates and maximum capacity levels. Hyperscale cloud nodes and on-ramps are mapped and a complete directory is provided.