Malaysia Data Center Networking Market Size
| Study Period | 2018 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 301.32 Million |
| Market Size (2029) | USD 521.61 Million |
| CAGR (2024 - 2029) | 11.60 % |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Malaysia Data Center Networking Market Analysis
The Malaysia Data Center Networking Market size is estimated at USD 301.32 million in 2024, and is expected to reach USD 521.61 million by 2029, growing at a CAGR of 11.60% during the forecast period (2024-2029).
The increasing demand for cloud computing among SMEs, government regulations for local data security, and growing investment by domestic players are some of the major factors driving the demand for data centers in the country.
- Under Construction IT Load Capacity: The upcoming IT load capacity of the Malaysia data center market is expected to reach 1300 MW by 2029.
- Under Construction Raised Floor Space: The country's construction of raised floor area is expected to increase by more than 7.5 million sq. ft by 2029.
- Planned Racks: The country's total number of racks to be installed is expected to reach 380 K units by 2029. Cyberjaya-Kuala Lumpur is expected to house the maximum number of racks by 2029.
- Planned Submarine Cables: There are close to 25 submarine cable systems connecting Malaysia, and many are under construction. One such submarine cable that is estimated to start service in 2025 is SeaMeWe-6, which stretches over 19,200 Kilometers with landing points from Morib, Malaysia.
- As a part of the National Energy Policy 2022-2040 ("NEP"), the Malaysian Government developed the Aspiration, which is aimed at producing a carbon Nation in 2040. The short-term implementation plan of the energy ambition is to develop a new Energy Efficiency and Conservation Act "EECA," which will set minimum performance standards for some types of energy-intensive industrial equipment in order to implement mandatory energy audits on certain categories of consumers as well as penalties for failing to meet them.
- In support of the above policy and to reduce energy consumption, the transformation of data centers is required; key players focus on developing a green standard for data centers in Malaysia, which results in increasing the demand for Infrastructure management. Hence, such factors are expected to drive market growth during the forecast period.
Malaysia Data Center Networking Market Trends
Telecommunication Holds the Major Share.
- Malaysia is going through an extended negotiation phase in the telecom sector. The two sides here are the government and the four main operators in the Malaysian telecom landscape: Maxis Berhad, Celcom Axiata Berhad, Digi Telecommunications, and U Mobile. In 2022, these four operators have requested a review of the government’s 5G access offer as they want at least a 51% stake in the government-owned 5G agency DNB.
- The development of digital infrastructures, such as data centers, is central to enabling 5G applications. With this, various investors are signing an agreement for the 5G launch. For instance, in November 2022, Malaysian telcos Celcom and DiGi approved the merger agreement. Once the two companies are fully merged, the new entity will be one of the largest carriers in Malaysia, with over 20 million subscribers.
- In context to data center investment for telecom, in the recent past, TM ONE, a business unit of state-controlled telecommunications company Telekom Malaysia, invested up to MYR 300 million (USD 70.94 million) for the development of a data center in Johor Bahru to cater to a growing demand from foreign entities. The facility is currently constructed as a core data center. With the growing scope of 5G in Malaysia, the data flow will increase exponentially, catering to the need for colocation.
- Malaysian telcos Celcom and DiGi have also approved a merger agreement. Once the two companies are fully merged, the new entity will be the largest carrier in Malaysia, with over 20 million subscribers. The company also said that the implementation of 5G technology would have a positive impact of MYR 150 billion (USD 31.88 Million) on the country’s GDP and create 750,000 jobs.
- Moreover, rising smartphone users coupled with discounted internet services and the increasing data traffic per smartphone drive the demand for telecom services, creating more need for data storage space and leading to rising demand for data center networking solutions in the region.
Ethernet Switches Holds Largest Market Share
- Datacenter Ethernet switches are network devices that operate in a data center environment. In order to facilitate the efficiency and rapid transfer of data, they play an essential role in establishing interconnection between servers, storage devices, or other network equipment at a data center. Switches are designed for high-speed data transmission with support for gigabit and multigigabit Ethernet, including 10 GbE, 25 GbE, 40 GbE, 100 GbE, and beyond.
- Malaysia has actively promoted Digital Transformation in different sectors such as finance, healthcare, and education. The core of this transformation is data centers, and connecting servers, storage, or networking equipment at those facilities requires an Ethernet switch.
- In order to process data quickly and reliably, there is a need for more effective connectivity in data centers as demand for data increases. Data center operators can achieve the highest possible data transfer speed and low-latency transmission by using Ethernet switches.
- Malaysia is becoming a regional hub for many businesses, which is driving more organizations to invest in cloud systems, which are, in turn, driving the need for more local data centers. The new government hybrid cloud service, called MyGovCloud, will be a combination of both private cloud services from PDSA and public cloud from a cloud service provider (CSP).
- The Malaysian Investment Development Authority (MIDA) plans to continue to attract quality investments with greater specialization in eight strategic and high-impact sectors under the 12th Malaysia Plan (12MP), including E&E, global services, aerospace, and smart farming. Such developmental aspects are expected to further complement the growth of the data centers in the region and substantiate the growth of network devices and services in the market.
- The key players in the market focus on updating the network devices to meet the market demand. In August 2023, H3C launched a new generation of data center switches, the S9827 series, the first 800G product built on CPO silicon photonics technology, boasts a single-chip bandwidth of up to 51.2T, supporting 64 800G ports, achieving an 8-fold throughput increase over 400G products. This design is based on advanced technologies, including liquid cooling and intelligent lossless operations that lead to an extremely widespread, low latency, energy-efficient smart network.
Malaysia Data Center Networking Industry Overview
The upcoming DC construction projects in the country would increase the demand for Malaysia data center networking market in the coming years. The Malaysia data center networking market is moderately consolidated with some players in the market, including Cisco Systems Inc., Arista Networks Inc., H3C Technologies Co., Ltd., VMware Inc., and Huawei Technologies Co. Ltd. These major players, with a prominent market share, focus on expanding their regional customer base.
In July 2023, Broadcom introduced a new software-programmable Trident 4-X7 Ethernet switch ASIC to support the growing need for 400G connectivity inside enterprise data centers as demand for increasing bandwidth levels increases.
Malaysia Data Center Networking Market Leaders
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Cisco Systems Inc.
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Arista Networks Inc.
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H3C Technologies Co., Ltd.
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VMware Inc
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Huawei Technologies Co. Ltd.
*Disclaimer: Major Players sorted in no particular order
Malaysia Data Center Networking Market News
- June 2023: Cisco’s Nexus 9800 Series modular switches expand the Cisco Nexus 9000 Series portfolio with a new chassis architecture to include a combination of several first-generation line cards and fabrics modules, allowing it to scale from 57 Tbps up to 115 Tbps. Line cards that now offer 400 GE or 100 GE ports and higher speeds can be supported by each line card slot on the chassis.
- March 2023: Arista Networks announced the release of the Arista WAN Routing System, which combines three new networking offerings, including carrier/cloud-neutral internet transit capabilities, enterprise-class routing platforms, and the CloudVision Pathfinder Service to simplify and improve customer-wide area networks. This System delivers the architecture, features, and media to modernize federated and software-defined wide-area networks.
Malaysia Data Center Networking Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Assumption & Market Definition
1.2 Scope of the Study
2. Research Methodology
3. Executive Summary
4. Market Dynamics
4.1 Market Overview
4.2 Market Drivers
4.2.1 Increasing Adoption of Cloud-Based Services
4.2.2 Advent of 5G Networks Drives Market Growth
4.3 Market Restraints
4.3.1 Cybersecurity Threats and Ransomware Attacks
4.4 Value Chain / Supply Chain Analysis
4.5 Industry Attractiveness - Porter's Five Forces Analysis
4.5.1 Threat of New Entrants
4.5.2 Bargaining Power of Buyers/Consumers
4.5.3 Bargaining Power of Suppliers
4.5.4 Threat of Substitute Products
4.5.5 Intensity of Competitive Rivalry
4.6 Assessment of COVID-19 Impact
5. MARKET SEGMENTATION
5.1 By Component
5.1.1 By Product
5.1.1.1 Ethernet Switches
5.1.1.2 Router
5.1.1.3 Storage Area Network (SAN)
5.1.1.4 Application Delivery Controller (ADC)
5.1.1.5 Other Networking Equipment
5.1.1.5.1 Including: Network security equipment, WAN optimization appliance, Softwares)
5.1.2 By Services
5.1.2.1 Installation & Integration
5.1.2.2 Training & Consulting
5.1.2.3 Support & Maintenance
5.2 End-User
5.2.1 IT & Telecommunication
5.2.2 BFSI
5.2.3 Government
5.2.4 Media & Entertainment
5.2.5 Other End-User
6. COMPETITIVE LANDSCAPE
6.1 Company Profiles
6.1.1 Cisco Systems Inc.
6.1.2 Arista Networks Inc.
6.1.3 H3C Technologies Co., Ltd.
6.1.4 VMware Inc
6.1.5 Huawei Technologies Co. Ltd.
6.1.6 Extreme Networks Inc.
6.1.7 Dell EMC
6.1.8 NEC Corporation
6.1.9 IBM Corporation
6.1.10 HP Development Company, L.P.
6.1.11 Intel Corporation
6.1.12 Broadcom Corp
6.1.13 Schneider Electric
- *List Not Exhaustive
7. INVESTMENT ANALYSIS
8. MARKET OPPORTUNITIES AND FUTURE TRENDS
Malaysia Data Center Networking Industry Segmentation
Data center networking refers to the set of technologies, protocols, and hardware used to connect physical and network-based devices and manage the network infrastructure, storage, and processing of applications and data. Data center networking is very critical for 100% uptime of data centers. In the current web-connected world, business workloads are executed on single computers, hence leading to the need for data center networking. Networks provide servers, clients, applications, and middleware with a standard plan to stage the execution of workloads and also to manage access to the data produced.
The Malaysia data center networking market is segmented by component type (product (Ethernet switches, routers, storage area network (SAN), application delivery controller (ADC), and other networking equipment), services (installation & integration, training & consulting, support & maintenance)), by end-user (IT & telecommunication, BFSI, government, and media & entertainment). The market sizes and forecasts are provided in terms of value (USD) for all the above segments.
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| End-User | |
| IT & Telecommunication | |
| BFSI | |
| Government | |
| Media & Entertainment | |
| Other End-User |
Malaysia Data Center Networking Market Research Faqs
How big is the Malaysia Data Center Networking Market?
The Malaysia Data Center Networking Market size is expected to reach USD 301.32 million in 2024 and grow at a CAGR of 11.60% to reach USD 521.61 million by 2029.
What is the current Malaysia Data Center Networking Market size?
In 2024, the Malaysia Data Center Networking Market size is expected to reach USD 301.32 million.
Who are the key players in Malaysia Data Center Networking Market?
Cisco Systems Inc., Arista Networks Inc., H3C Technologies Co., Ltd., VMware Inc and Huawei Technologies Co. Ltd. are the major companies operating in the Malaysia Data Center Networking Market.
What years does this Malaysia Data Center Networking Market cover, and what was the market size in 2023?
In 2023, the Malaysia Data Center Networking Market size was estimated at USD 266.37 million. The report covers the Malaysia Data Center Networking Market historical market size for years: 2018, 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Malaysia Data Center Networking Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Malaysia Data Center Networking Industry Report
Statistics for the 2024 Malaysia Data Center Networking market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Malaysia Data Center Networking analysis includes a market forecast outlook to for 2024 to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
Malaysia Data Center Networking Market Report Snapshots
