Google mulls development of hyperscale data centre in Vietnam

As reported by Reuters, Google is weighing setting up a "hyperscale" data centre close to Ho Chi Minh City, Vietnam's southern economic hub, the source said, adding that internal talks were taking place and the data centre could be ready in 2027.

Google's move is motivated by the large number of its domestic and foreign cloud services clients in Vietnam and the country's expanding digital economy, the source said, noting the Southeast Asian nation was one of the fastest-growing markets for YouTube, Google's popular online video sharing platform.

A spokesperson for Google declined to comment about the data centre plan.

According to Statista, revenue in Vietnam’s data centre market is projected to reach $1.83 billion in 2024. Vietnam’s market is expected to grow at an annual growth rate of 7 per cent from 2024 to 2028, resulting in a market volume of $2.40 billion by 2028.

Digital adoption, internet usage, and connectivity are the key drivers of the data centre industry across the world. Specifically, Vietnam boasts a 70 per cent internet penetration rate, and 76 per cent of the population have mobile access focusing on over-the-top content, streaming, video games, and social networks. This, coupled with reasonable connectivity with Vietnam and the rest of the world via terrestrial and subsea cables, makes the data centre market bright in Vietnam.

Indeed, hyperscale data centre providers are making moves into Vietnam to increase their cloud footprint, boosting demand.

The announcement of a partnership between VNG Corporation and ST Telemedia Global Data Centres for a large-scale facility in Ho Chi Minh City follows that trend.

In July, CMC Corporation also announced that it has invested $12.5 million to establish a subsidiary that aims to construct and operate hyperscale data centres. In May, VNG partnered with Nvidia to boost cloud computing capabilities.

Also in the same month, Alibaba announced a plan to build a Vietnamese data centre to follow local storage laws, while Hyosung unveiled its plan to build a data centre in Saigon Hi-Tech Park to tap into the growing demand for digital infrastructure in the region.

According to a report by real estate consultant Jones Lang LaSalle, a hyperscale data centre with power consumption capacity of 50MW could cost between $300 million and $650 million.

Alibaba plans $1 billion data centre in Vietnam Chinese teach giant Alibaba Group Holding Limited plans to build a data centre in Vietnam to meet legal requirements for local data storage and to meet to increasing demand in one of Asia’s fastest-growing economies, according to Nikkei.

Hyosung plans data centre in Ho Chi Minh City South Korean industrial conglomerate Hyosung Corporation has expressed its intention to build a data centre in Saigon Hi-Tech Park (SHTP).

ST Telemedia and VNG launch data centre partnership On May 15, Singapore-headquartered firm ST Telemedia Global Data Centres (STT GDC) and Vietnam's VNG Corporation announced a strategic collaboration to develop and manage international standard data centres in Ho Chi Minh City.