AIMS begins construction on data centre hub in Malaysia
Questions have been raised over plans for a post-Covid, tech-powered economic recovery in China, as it emerged the country’s 74,000 data centres utilise only half their storage and computing capacity.
Further, facilities in eastern regions struggle to expand, while many in the west are underutilised, according to Hua Chuang Securities. It said server racks in more remote areas – which comprise 32% of China’s total inventory – are running at 26% capacity, highlighting a mismatch between planning and utilisation.
The trend also highlighted a dwindling appetite to build and operate facilities outside of China’s major economic hubs, however, without data centres in remote locations it is likely that digitalisation will be hindered in these areas.
As reported by Data Economy, China has embarked on a near US$4 trillion digital infrastructure spending spree to 2025; a figure that averages $63 billion a month for the next five years.
The investment included several projects already in the public domain: Tencent’s $70 billion data centre, cloud and AI investment; Alibaba’s $28 billion cloud infrastructure expansion ; China Mobile, China Telecom and China Unicom’s combined $25.2 billion 5G base stations deployment projects, and more.
Government investment is also expected, however, all funds will be vital as VC investments in China’s tech sector have all but dried up year to date. As a direct result of Covid-19, VC investments in Chinese tech declined 31.3% year on year in Q1.
A data centre half full
New data published by Reuters said that currently the country’s 74,000 data centres are using only half their storage and computing capacity, raising questions about the country’s ability to find enough tenants for its new facilities.
Yet the building continues. Reuters said the Chinese government will spend up to $400 billion on data centres and high-tech infrastructure this year, as digitalisation gains pace and companies increasingly look to store data nearby to improve latency.
In Xinjiang, in the remote northwest, the trend for mega data centre clusters will see up to 200,000 server racks added by the end of this year.
Over in Jinchang, which borders Inner Mogolia, one third of the 2,500 server racks hosted in the city have been rented out.
However, the vice-mayor said up to $283 million will be invested in new data centres this year, as the former nickel capital of China diversifies its economy. The figure followed an investment of around $140 million in 2017.