Market Trends of Singapore Data Center Server Industry
BFSI to Hold Significant Growth
- In Singapore, with the rise of online banking and mobile payment systems, financial institutions are able to process transactions quickly and securely. Data centers provide the high-speed connectivity and processing power needed to ensure that transactions are processed in real-time, reducing the risk of errors or delays. Such factors lead to a major demand for servers for better computing.
- Capco surveyed 1,000 Singapore consumers to gauge their behavior towards banking services at a time of rapid change in the retail banking industry. The survey states that 81% of Singapore banking customers using mobile apps want to access banking services.
- Companies such as Grab Holdings are making strategic collaborations to capitalize on the growing market. Their joint venture with Singapore Telecommunication GXS Bank provides digital banking services to the retail sector. Recently, Singaporean businesses Grab and tech company Sea obtained 'digital full bank' licenses, enabling them to accept deposits and provide services locally to both retail and corporate customers, now serving more than 3 million customers.
- Several fintech startups are further boosting the market by attaining strategic partnerships with cloud service providers to automate their respective payment portals. In April 2022, Wallet Engine partnered with Mambu to fast-track the development of its innovative wallet-as-a-service offering, which aims to become the go-to solution for embedding financial services into any app.
- Overall, with increasing fintech firms, the demand for data centers will increase potentially, leading to demand for the server market.
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Rack Server to Hold Significant Share
- Rack servers are compact and efficient devices that can handle a variety of computing tasks and are commonly used in data center environments where space is at a premium. In Singapore, various end users prefer rack servers as it is more cost-effective than blade servers,
- The data center industry has begun to gain momentum with attractive investments from hyperscale cloud providers such as Google, Alibaba, and Amazon. Due to the pandemic, Google announced its third data center in the country, representing a long-term investment of about USD 850 million.
- The rising dominance of the 5G network is further adhering telecom vendors to invest in the data center. In July 2022, Singtel was confirmed to have achieved more than 95% standalone 5G coverage across Singapore, three years ahead of the regulatory target of end-2025, covering more than 1,300 outdoor locations.
- Moreover, in August 2022, The Infocomm Media Development Authority (IMDA) on Wednesday (Aug 3) unveiled three more 5G projects to help Singapore use the fifth-generation mobile network in different areas. The projects involve 5G usage in augmented reality (AR), health technology, and the maritime sector. This would increase the demand for bandwidth due to increased data traffic, further driving the demand for rack servers.
