Asia leads in cloud data centers expansion

Expert Marvin Tan discusses connectivity methods and Asia’s prominence in global cloud services.

When talking about cloud service providers (CSPs), dedicated interconnection should be the goal of companies expecting optimum performance and security, especially if they have high capacity requirements or business-critical applications in their day-to-day needs.

Marvin Tan, a seasoned Asia Infrastructure Analyst with Telegeography, underscored the significance of this point in Asia, which has surfaced as a leader in cloud zone expansion and diversified enterprise connections, according to recent findings from the Q1 Cloud and WAN Research data.

“Asia is actually a pretty mature market when it comes to cloud services, with coverage from both Chinese and American CSPs,” Tan told Asian Telecom in a recent interview. “Having dedicated links to CSP offers predictable network performance even during peak usage hours and higher security compared to the typical public internet connection.”

Tan returned to the basics to explain how enterprises have several methods to establish connections with the cloud: peering with cloud service providers; using IPsec VPNs over the Internet; and dedicated interconnections.

While the easiest connection is through the public internet, peering provides an improved mode via internet exchanges. This method often faces performance variations, latency, and security issues due to potential traffic over the public internet.

IPsec VPNs, on the other hand, offer a secure and cost-effective connection, suitable for enterprises prioritizing security but not requiring vast data capacity.

Meanwhile, dedicated interconnections, designed for businesses necessitating higher performance and capacity, give them an edge, which Tan likened to driving on a private highway. Comparing it to the first option, he said: “Peering with CSP is more like driving on a public road network, cost-effective but variable in quality and congestion.”

But whilst dedicated interconnections are advantageous in many ways, they may not be cost-effective for smaller enterprises due to the recurring fees involved.

What’s undeniable is that these links offer predictable network performance, higher security, and, by bypassing the public internet, help reduce network hiccups and improve application performance, particularly in Asia which is home to big populations.

“Asia is home to 60% of the world’s population, resulting in a surge in data consumption and a growing demand for data centers and cloud services,” Tan noted. As such, recent data spotlighted Asia’s dominant position of hosting 65% of the world’s cloud data centers.

So, there are challenges associated with dedicated links to CSPs like setup complexity, higher costs, and regional limitations. “The process of setting up and maintaining dedicated links to CSPs is complex and may delay cloud deployments,” he said.

The Asian market, Tan explained, is driven by behemoths like Alibaba, Tencent, Huawei, AWS, Google Cloud, and Microsoft Azure. Coupled with this, the rapid population growth, urbanization, technological advancements, and a booming tech industry have contributed to the exponential rise in data consumption, resulting in increased demand for data centers and cloud services.

Having data centers clustered across Asia offers numerous advantages, Tan points out. It helps in reducing latency for users, ensures enhanced redundancy, and provides optimal disaster recovery solutions. This is particularly vital as Asia serves as a critical access point to various global regions, leveraging existing network infrastructure to bolster global network connectivity.