Market Trends of Malaysia Digital Transformation Industry
Cloud Edge Computing to Register Significant Growth
- With the rise of new applications and services in Malaysia, the need for architecture designed to support distributed infrastructure is increasing. Companies are leveraging cloud architectures for their distributed setups across various sites and networks due to their streamlined management and adaptability. For example, in the IoT sector, data flows from numerous microsites, highlighting the advantages of an edge computing approach.
- Malaysia's emphasis on digitalization, cloud computing, and AI, bolstered by robust network infrastructure and numerous port cities, primes the nation for cutting-edge technological progress and enhanced global integration. In September 2023, EdgeConneX expanded its business in the Malaysian market, to set up high-capacity data centers across three key locations. This strategic expansion is poised to yield a collective capacity of nearly 300 MW.
- Moreover, in September 2023, Telekom Malaysia Berhad (TM) and SK Telecom signed a Memorandum of Understanding (MoU) to collaborate on developing Malaysia's Multi-Access Edge Computing (MEC) landscape. This partnership is expected to bring opportunities and implementing MEC services in Malaysia.
- Moreover, the role of cloud computing in advancing digitalization and driving business growth has become increasingly crucial. Small and Medium Enterprises (SMEs) now depend on digital transformation to stay competitive and achieve expansion. In March 2024, SME Association of Malaysia (SME Malaysia) encouraged SMEs to advance up the value chain by digitalizing business processes and implementing factory automation. This initiative supports the government's economic goal of achieving high-income nation status by 2025.
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The IT and Telecom Sector is Expected to Drive the Market
- Malaysia is intensifying efforts to expand its 5G infrastructure, recognizing the pivotal role it plays in bolstering economic growth, attracting investments, fostering innovation, and amplifying productivity gains. This strategic move not only propels Malaysia's economic development but also fortifies its global competitiveness.
- According to Malaysian Communications and Multimedia Commission, in Q4 2023, Malaysia had around 8.2 million 5G-enabled mobile broadband subscriptions, marking a surge from the three million subscriptions in the preceding quarter. Over the past year, Malaysia witnessed a substantial rise in its 5G mobile broadband subscriptions.
- Further, according to GSMA Intelligence, Malaysia had 44.5 million cellular mobile connections at the start of 2024, representing 129.2% of the country's population. During the period from 2023 to 2024, Malaysia saw an increase of 169 thousand mobile connections, marking a growth of 0.4%.
- In October 2023, NTT, a Japanese IT services provider, has opened its sixth data center, CBJ6, in Malaysia's Cyberjaya science park and tech hub. This project, representing a significant US$50 million (S$68 million) investment. Covering 4,890 square meters, CBJ6 features a substantial IT load capacity of 7MW and supports power densities of up to 15 kW, powered by two 33 kW substations. NTT also emphasized the strategic importance of the forthcoming MIST optical submarine cable, which will connect Malaysia, Singapore, and India. This cable aims to enhance connectivity between CBJ5 and CBJ6 and improve Malaysia's overall network infrastructure.
