Data Center Market Trends

Johor will host 60% of Malaysia's data centre capacity by 2030. Hard to believe that Johor had just one data centre in 2021. 🔸Trade Minister Tengku Zafrul Aziz revealed the 60% figure at this week’s signing ceremony, where DayOne secured RM15 billion (US$3.5B) in financing for its data centres in Johor. 🔸Right now, Johor has about 30 data centre projects completed or under construction; another 20 more are awaiting approvals. To think it has zero data centres in 2020. What happened? Opportunity. Demand. Quick reaction. 𝟭/ 𝗢𝗻𝗰𝗲-𝗶𝗻-𝗮-𝗴𝗲𝗻𝗲𝗿𝗮𝘁𝗶𝗼𝗻 𝗴𝗿𝗼𝘄𝘁𝗵 It's arguably that Singapore's data centre moratorium of 2019 set the stage for its growth in the region. Of course, it also happened at a time when data centre growth surged globally. While Johor had a single 10MW data centre (Keppel's DC Johor 1) in 2021, regional players soon started building in earnest there - right across from Singapore. It helped that Malaysia was an optimal location and reacted quickly to support the sector. - Has a strong base of data centres. - Surplus of power generation capacity. - Created new initiatives to support data centres. And things just took off. But no matter how I look at the charts compared to other APAC markets, the growth trajectory remains astounding. (Details here: https://lnkd.in/gXsEVrEG) 𝟮/ 𝗖𝗿𝗶𝘁𝗶𝗰𝗮𝗹 𝗺𝗮𝘀𝘀 Last year, everyone I spoke to was either already building a data centre campus in Johor, or say they have a pending announcement to make. In fact, I visited the launch of one data centre in Johor last month, which was built with fully prefabricated modular components in less than 8 months. (Read "BrightRay's MY-01": https://lnkd.in/g9c65STj) More recently, I'm hearing of a slowdown in growth. Still, I believe Johor has achieved a critical mass as a data centre hub - it is now too big to fail. 𝟯/ 𝗪𝗵𝗮𝘁'𝘀 𝗻𝗲𝘅𝘁 There are challenges that need to be addressed. Here are two of them. (𝗮) 𝗘𝗻𝘁𝗲𝗿𝗽𝗿𝗶𝘀𝗲 𝘄𝗼𝗿𝗸𝗹𝗼𝗮𝗱𝘀 No matter who I asked, I haven't yet heard of any deployment of enterprise workloads in Johor. In my mind, it's vital for future growth due to the finite number of hyperscale customers. (𝗯) 𝗥𝗲𝘀𝗼𝘂𝗿𝗰𝗲 𝘀𝗵𝗼𝗿𝘁𝗮𝗴𝗲 Localised resource shortage will need to be addressed. For instance, BrightRay's phase 2 and phase 3 will use dry coolers, not cooling towers. That's because Sedenak has some issues with its water supply - it'll take time to resolve. What are your thoughts on the Johor data centre market? 📆 𝗚𝗲𝘁 𝗺𝘆 𝗰𝗼𝗻𝘁𝗲𝗻𝘁 Don't be limited by what LinkedIn shows you. Get my weekly digest via email: www.techstories.co/updates My name is Paul Mah and I explore tech developments with bite-sized reports in #EverydayTechStories 𝗣𝗵𝗼𝘁𝗼 𝗖𝗿𝗲𝗱𝗶𝘁: Paul Mah. Photo of transmission lines and a power substation at Sedenak, Johor.

Telcos, Welcome to Your New Customers: AI Agents The iPhone marked a before and after in telecom. Networks engineered for voice collapsed under video demand. Operators spent billions on spectrum, radios, and fibre backhaul, but ARPU sank from $22.39 in 2009 to $13.56 by 2019 and another 20 percent by 2023. The value was captured by Apple, Google, and digital platforms, not the carriers who carried the load. A second shock is arriving with AI agents. These are not IoT devices with dumb SIMs but autonomous pieces of software, often cloud-based, that authenticate, negotiate, and transact thousands of times per second. Their arrival reshapes every part of the telco business. Networks shift from managing downstream video streams to orchestrating upstream biometric data, inference payloads, and relentless bursts of signalling. Edge compute becomes the new backbone, replacing CDNs as the critical layer of performance. Operations and BSS no longer revolve around monthly bundles but around real-time billing, event-based charging, and automatic SLA credits. The customer journey breaks apart: the “user” is no longer a human who can be persuaded by advertising or loyalty points, but an algorithm that selects providers based only on latency, trust, and price. Commercial logic pivots from ARPU to RPI, revenue per thousand verified interactions, with identity and determinism becoming the true products. Even the ecosystem map shifts: just as Apple and Google seized the interface in the smartphone era, hyperscalers are already racing to build agent marketplaces. SoftBank has announced plans to deploy one billion AI agents across its companies, and forecasts put the telecom opportunity at $188 billion by 2034. Nobody willl invite Telcos to the party. We will need to claim our role this time, or once again build the infrastructure while someone else takes the economics. Full analysis here: https://lnkd.in/gvkTKqzx

Data center inventory in North America grew by a record 43% over the past 12 months, but the region’s vacancy rate remains near historic lows at just 4.2%, according to new data from the CBRE Global Data Center Trends report for 1Q 2025. In other words, developers are deploying more new data center space than ever, but are still unable to keep up with demand, according to CBRE Data Center Solutions. “Rising demand from AI and hyperscale users is shrinking vacancy and operators with available capacity in key markets are commanding premium rates,” said Pat Lynch, executive managing director for CBRE’s Data Center Solutions. Despite ongoing power supply challenges, Northern Virginia remained the largest market, expanding its inventory by 523 megwawatts (MW) over the past 12 months, with a vacancy rate of just 0.76%. The average rental rate increased by 15%, driven by preleasing of facilities scheduled for delivery as far out as 2028. The Top 5 U.S. markets continued to evolve, as Atlanta and Phoenix are now the second and third largest data center markets in North America, surpassing Dallas and Silicon Valley, now fourth and fifth. “Power constraints in legacy markets are forcing hyperscalers to seek new frontiers for development, spreading workloads across multiple smaller locations with faster power availability timelines,” said Gordon Dolven, Director of CBRE Americas Data Center Research. “While improvements in fiber connectivity have reduced latency concerns and supported this shift, it’s power that ultimately determines where infrastructure can scale.” Here's a chart that illustrates the supply issues: Of the 7 markets with the lowest vacancy rates, all but Singapore are in the Americas. Read the report here: https://lnkd.in/eW3aVhQP

“The cloud is just someone else’s computer… sitting on someone else’s land, drinking someone else’s water.” Google’s decision to withdraw its $2 billion data centre project from Indianapolis stayed with me. Not because projects get cancelled, but because of what it revealed. Digital convenience has a physical footprint. The cloud may feel weightless. Its infrastructure is anything but. Local reporting pointed to environmental concerns from water usage, electricity demand, & community pushback. Even one of the world’s most efficient technology companies could not make the economic, environmental, & social math add up. I am not anti-data centre. I am thinking aloud about the scale, limits, & trade-offs we gloss over when we talk about “digital” growth. Take water. Data centres need intensive cooling. Water cooled systems are more energy efficient than air cooling, but the numbers are sobering. A single hyperscale facility can consume three to five million gallons a day, roughly what a small town uses. In drought prone regions, this has already triggered conflict. The question sharpens quickly: scarce water for servers, or for citizens? Then there is energy. The IEA estimates global data centre electricity use could double by 2026, driven by AI workloads. A hyperscale facility can draw as much power as a large industrial plant. In India, where grids already juggle agricultural, industrial, & urban demand, this is not abstract. Add capacity without planning, & we risk instability or deeper dependence on coal. There is also heat. Data centres do not just consume energy; they expel it. In warmer geographies, this becomes a liability. Systems designed for “cool efficiency” often end up warming neighbourhoods. Land adds another layer. Data centres promise jobs but create few permanent ones relative to the land they occupy. Communities are questioning what they give up, farmland, housing, green space, in exchange for high security campuses with limited spillover benefits. India is one of the fastest growing data centre markets, fuelled by AI, fintech, gaming, & digital public infrastructure. These questions are urgent, not theoretical. Where will the water come from? Can we meet power demand sustainably? Will communities benefit meaningfully? This is not about slowing ambition. It is about aligning ambition with ecology. Google walking away feels less like a corporate decision & more like a signal. The digital world is hitting physical limits. Every message leaves a trace. The cloud is not magical. It is material. Sharing this as part of my thinking aloud series, questions, not conclusions. Where are we underestimating the real costs of “digital” growth? What trade offs are we still unwilling to name? #Cloud #Data #Technology #Innovation #Ai

JUST MAPPED: 5 North Carolina Counties Where Big Tech Is Betting Billions And Land Hasn't Caught Up Yet I sell land. Sometimes it has stuff on it. But over 31 years and 1,124 transactions, I've learned one thing: The best deals happen when infrastructure arrives before awareness does. Right now, that's happening in North Carolina. And most people are looking in the wrong places. Here's what's driving this: Duke Energy is forecasting 6 gigawatts of new data center demand. That's the equivalent of SIX nuclear power plants worth of capacity. Data center construction in Charlotte/Raleigh surged 15X the previous record, 90% preleased, positioning the market to jump from 8th to 4th largest in North America. Northern Virginia is tapped out. Data centers need four things: → Available power capacity → Low-carbon energy sources →Water access for cooling → Land at reasonable prices North Carolina has all three. Three thoughts on this: 1. Follow the Substations, Not the Headlines When Amazon spends $10B, they're not gambling. They spent years mapping Duke Energy's grid capacity, fiber routes, and water access. The land they bought was infrastructure-ready before they arrived. Look for similar patterns in adjacent counties. 2. Power Is the New Proximity Location used to mean "close to population centers." For data centers, location means "close to gigawatt-scale power and fiber backbones." Land values are resetting around infrastructure, not demographics. 3. The Window Is Narrow Duke projects load growth acceleration hits 2027-2029. That's when construction ramps hard and land gets repriced. Right now, you're seeing billion-dollar validation of infrastructure that smart buyers can still access at pre-awareness prices. I'm not predicting percentages or promising returns. I'm reading the map. And the map shows where the power lines meet the capital flows. Tomorrow I'll break down the 5 specific counties, current land prices, and exactly what infrastructure advantages make each one a strategic play. Which NC counties are you watching? Drop a comment, I'd love to hear what you're seeing. Might as well, as the Great One said: "skate to where the puck is going." 🐾⚡

The Texas PUC released proposed requirements for large loads (>75 MW) trying to connect in ERCOT. ⚡️ The rules could re-price every data center deal. Here’s the financial reality for developers. 1. The "Intermediate Agreement" (signed first with the utility): ➡️ $50k per MW requested peak demand upfront security (a 500 MW campus = $25M) ➡️ Proof of site control (5-year minimum lease) ➡️ Project Maturity Data: You must provide geotechnical plans, air/water permit status, and a phased energization schedule. 2. Interconnection costs ➡️ $50k per MW contracted peak demand ➡️ You pay 100% of direct interconnection costs (CIAC). No allowances. ➡️ Withdraw or miss a milestone? The utility takes your security to cover their costs. After that, you only get 20% of the remaining balance back. The other 80% is forfeited to the utility’s rate base. 3. The 5-Year Rule: You don't get your security back until you sustain peak demand for 5 years. ERCOT’s regulatory decisions carry disproportionate weight because Texas is the largest competitive power market in the country and the single largest destination for new AI infrastructure investment. Developers operating in PJM or MISO should be reading this Texas rulemaking as a leading indicator of where their own interconnection economics are heading. ❗️ If you’re a developer trying to originate new projects in ERCOT, the comment period on this ends April 17th. I break down the full implications of these proposed rules in this week’s Power Signal. Read my full take here: https://lnkd.in/ebytwuPA Subscribe for free ➡️ powersignal.substack.com #datacenters #AI #powerinfrastructure #energy #energyinfrastructure #ERCOT

The Netherlands is exploring innovative ways to make data centers more energy-efficient by developing floating data centers that use canal water for cooling. Data centers require enormous amounts of electricity, not only to power servers but also to cool the equipment and prevent overheating. Traditional data centers rely heavily on air-conditioning systems, which consume significant energy and increase operational costs. To reduce this energy demand, engineers in the Netherlands have proposed floating server facilities that use nearby water sources such as canals, lakes, or ports for natural cooling. The concept works by circulating water from the canal through specialized heat exchangers. The water absorbs heat generated by the servers and carries it away, reducing the need for energy-intensive cooling equipment. This method can significantly lower energy consumption and reduce the environmental footprint of large-scale computing infrastructure. Floating data centers also offer additional benefits such as modular construction, flexible deployment, and efficient land use in densely populated cities. The Netherlands, known for its extensive canal networks and expertise in water engineering, provides an ideal environment for testing this approach. As global demand for cloud computing, artificial intelligence, and digital services continues to rise, innovative cooling solutions like floating data centers could play a major role in making the world’s digital infrastructure more sustainable and energy-efficient. #DataCenterInnovation #GreenTechnology #SustainableComputing #TechInfrastructure #FutureEngineering

Datacenters are the foundation of our digital lives. They also create opportunities to demonstrate what’s possible when sustainability is treated as a design principle, not an afterthought. Teams around the world at Microsoft are tackling the energy and resource challenges of cloud computing head-on. In Europe alone, we’re implementing a variety of solutions: 🌱 Boosting biodiversity: Datacenters in the Netherlands are being designed with biomimicry principles, planting 150 native trees and 2,300 square meters of vegetation to restore habitats, improve water management, and reduce environmental impact. 💧 Saving water: We’re building datacenters in Spain with closed-loop cooling systems that fill once during construction and then continuously recirculate water between servers and chillers, eliminating the need for additional water and dramatically reducing consumption. 🔁 Cutting carbon: A new datacenter in Wales is being built using materials from a shuttered radiator factory, avoiding hundreds of tons of CO₂ emissions through smart reuse. ⚡ Stabilizing the grid: Across the Nordics, battery-backed systems help maintain steady grid frequency, making renewable energy easier to integrate and supporting a more resilient power supply. 🔥 Heating homes and businesses: Recovered heat from datacenters in Finland will help warm up to 250,000 homes and businesses through a municipal heating system. Denmark is setting up a similar system to extend the benefits of sustainable heating to more communities. Every day I am blown away by the creativity and ingenuity of these teams and our local partners. Check out these prime examples of this work. Read the latest story from Source to learn more: https://lnkd.in/gUtARfJ3 

Can Malaysia Become the Global AI Data Hub? In southern Malaysia, the state of Johor is quietly becoming one of the fastest-growing hubs for AI infrastructure in the world. Clay Chandler, Fortune’s Executive Editor for Asia, has a knack for spotting trends before they go mainstream—this one’s no exception. Here’s what he writes: Once known for palm oil plantations, the state is now home to a booming data center industry—those massive facilities that power everything from AI to cloud storage. ► Malaysia’s pitch is clear: cheap land, abundant electricity, and full government support. Officials have rolled out tax breaks, streamlined permits, and launched the Green Lane Pathway to fast-track power grid connections for new facilities. ► After ChatGPT’s release, global demand for computing power has exploded. In 2024 alone, Malaysia attracted over $30 billion in data center investments. 😲 Johor now has over 40 massive data centers up and running or in development. The total power demand from Johor’s data centers is 1,500 megawatts, which is sufficient to supply electricity to more than a million homes. Chinese companies are reportedly the main customers of data centers in Malaysia and tech giants like Microsoft, NVIDIA, and Oracle are moving in too. Will it all stick—or prove too much, too fast, if AI shifts toward leaner, more efficient systems? Either way, Malaysia isn’t just catching up—it’s making a serious play to lead. #AI #technology

Something’s happening in Navi Mumbai! It's a data centre vs residential tug-of-war. Every land transaction is setting newer pricing benchmarks ✨ Land prices here are no longer moving annually. They’re moving monthly. With residential now permitted, land has suddenly acquired a new identity. 🏗️➡️🏠 This is where the psychology of money gets interesting. When land gets a second life, every previous use has to be re-evaluated for its relevance. For many years, Thane-Belapur belt in Navi Mumbai had quietly become India’s data center nerve centre. Availability zones were planned, capital infused, power procured, fiber laid ⚡🧵 Over the last year, there is a change in thought pattern with developers and land owners. Data centres are no longer just competing with each other. They’re competing with homes. Same land. Very different economics. Very different emotions. Residential brings: ✨ faster liquidation 🧠 ✨ scale and FSI utilization 🏘️ ✨ social infrastructure Data centres bring: ⚡long-term economic infrastructure 🧱 ⚡low employment optics ⚡heavy utility consumption Globally, we’ve seen this story before 🎥 In Northern Virginia’s Data Center Alley, as residential crept closer, prices exploded and approvals slowed. But the availability zone didn’t shut down. In Arizona, large hyperscale projects were redirected after community and cost pressures. Moving closer to industrial and airport-linked corridors instead. Just silent strategy repositioning. What happens to existing zones? They are made to sweat harder. The sunk capex, network effects, power density and latency advantages are too valuable to walk away from. So operators and hyperscalers adapt. What usually happens next isn’t dramatic. It’s incremental. So, here’s my view- ✔️ Data centres will continue to compete with residential for the right land parcels for the next two years. As long as land remains available and prices are still within reason ⚖️ ✔️ Existing sites keep operating, often denser and more optimized ⚙️ ✔️ But incremental large scale hyperscale capacity begins to look outward, creating new zones, new rings, new corridors 🌍 Navi Mumbai, in that sense, is entering a new phase of maturity. The question is - How long can data centres and residential continue bidding for the same land before the next availability ring naturally forms? Because capital will eventually recalibrate. And cities, like people, don’t change overnight. They evolve - zone by zone, decision by decision. 🧠 Are we watching Navi Mumbai turn into a multi-ring data centre market in real time? What are your thoughts? PS: Pic clicked by me - Navi Mumbai, my favourite city in the country 🌆