Singapore DCI Report 2022: Data Centre Colocation, Hyperscale Cloud & Interconnection

Executive Summary

The Singapore data centre market continues to push forward. According to the data presented in this report, the Singapore market was worth almost $1.6 USD in 2021 and is projected to grow at a five-year CAGR of 16% going forward. The value of the market is expected to reach almost $1.9b this year. In terms of market size, current built-out capacity will reach close to 630MW in 2022 and cross the 700MW threshold in 2023.

There has been a significant shift in the market as the build moratorium that went into place in 2020 has been lifted, but will not allow for a return to the way things were despite steady overall demand and the ballooning of hyperscale requirements, which now includes Oracle Cloud. The new environment unfolding in Singapore is still in motion, but is expected to favour scaled operators with the means to meet stricter environmental and regulatory oversight and this notably includes hyperscale self-builds.

Operators without the ability to serve global or regional requirements will face an increasingly tighter landscape and likely have to pivot from more generic colocation towards offerings that are interconnection-oriented, geared to high-performance or have a significant data location and compliance component. Edge scenarios are likely to emerge within this context as latency and location are intertwined. Over time, the workloads hosted within Singapore are going to have this kind of value attached to it, while raw compute and storage infrastructure is going to be deprioritized.

This reality has already started to have an impact on market dynamics in and around Singapore. There are overflow scenarios already emerging in neighbouring Johor, Malaysia and Batam, Indonesia. Chinese hyperscalers are likely candidates to consume the multi-MW capacity that can no longer be built out endlessly in Singapore and to which they do not have a stockpile of accessible inventory. Eventually, as things play out, large quantities of raw compute and storage infrastructure from hyperscalers will start to serve Singapore from these adjacent overflow locations.

Singapore will continue to try and squeeze as much as it can out of its finite resources. Floating and underwater data centres will get a long look and new cooling technologies that can help bring energy consumption down will be given top priority. But the fact remains that Singapore is set to move into a transition phase. Occupancy levels are high and expected to remain at that level. But when inventory starts to dry up, expect overflow scenarios to gain more traction, while new and existing inventory will serve an increasingly different type of customer and workload profile.

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 Singapore 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 hyperscale 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. A new addition to our DCI report series is tracking of hyperscale self-builds.