enhancing hong kong's competitiveness through data center and cloud computing -- trends and...

Juniper Innovation Day 2016Enhancing Hong Kong’s

Competitiveness Through Data Center and Cloud Computing – Trends and

Policies

Factors driving data center demandCloud services and storage Connected devicesDigital entertainmentWorlwide spending on cloud services is expected to reach more than $107 billion in 2017

“the global cloud workloads will be more than triple from 2014 to 2019, and the global cloud traffic will increase at a compound annual growth rate of 33% over the same period. As a result, the global workloads for data centres will more than double from 2014 to 2019, and the global traffic will increase at a compound annual growth rate of 25% over the same period

Source: Cisco Global Cloud Index: Forecast and Methodology, 2014–2019

Long term trend beyond 2016◇Server workload◇Power demands◇Network bandwidth◇Storage

DCs need to stay competitive

Shortens the traditional life cycles of data centers

Increases the need for infrastructure refresh in older data centers

“ “About 20 percent of the data centers in the region (Asia Pacific) are more than 8 years old and are not really geared up to handle the demands of modern high density computing platforms,” Simon PiffVP of Enterprise Infrastructure research at IDC Asia Pacific to Datacenter Dynamics

Key questions◇What are the changes in the demand and supply of data center from the trend of cloud computing?

◇How is the industry adapting?

◇What can be done to improve HK’s attractiveness as an international data center hub and stay competitive?

Big data analysis

FinTech

IoT and Smart Cities

Mega trends

Latest Data Center Development in Asia

Tech Firms looks to AsiaGoogle chose Singapore and Taiwan as its data center in Asia, investing over USD1bn in total. ◇Singapore: $500m on a second, larger, multilevel data center to go online in mid-2017◇Taiwan: allocated $600m for Data Center and $66 million to increase capacity

Amazon Web Services launched data center infrastructures in India in 2016, and already set up data centers in Korea, Singapore, Beijing, Tokyo, and Sydney in Asia.

APAC Govts race to attract DC investments

◇Singapore: government-led Singapore Data Center Park, pro-biz, green incentives

◇Taiwan: a vision to make TW the next APAC Information Operations Center, land policy

◇South Korea: government driven huge investment in IT industry, encourage startups

◇China: tech firms going global fast, Shenzhen’s initiative in Internet Finance driving DC service demand

◇Others: tax incentives

Varied approaches in DC facilitation◇ Incentives, e.g. tax

breaks, cheap land, facility maintenance services

◇ Proactive communication and liaison with Tech companies

◇ Government driven cooperation

What’s for Hong Kong?

HK as key regional data center destination

◇Low tax rate◇Well-established legal system◇One of the safest place to build DCs in Asia◇Extensive business network◇Reliable energy supply◇Extensive and reliable network connectivity◇Blooming start-ups◇IP protection

Existing government support

◇Land Supply: Industrial Estates, Greenfield Sites Available for Sale, Land Earmarked for Data Centers

◇ Data Centre Facilitation Unit and Thematic Portal (OGCIO)

◇Waiver fee exemption for change in use of parts of existing industrial buildings

◇Tailor-made lease modifications of industrial lots for data centre use

“ITB: Currently, 12 sites with a total of about 19 hectares of land in the Tai Po and TKO Industrial Estates are designated for the development of high-tier data centres, providing a floor area of over 300 000 sq m. Upon completion of several data centres in TKO, Kwai Chung and Tsuen Wan (including IEs and those provided by the private sector) in the coming two years, the GFA for data centre development in Hong Kong will increase to 660 000 sq m to meet the market demand in the next few years. Moreover, we have reserved three hectares of land in TKO for data centre development by the private sector.

LCQ6, December 2015

But while in SGR, total data center space is around 2.3 million sq m

Land supply remains a key issue

◇Tseung Kwan O, New Territories New Development Areas (Lok Ma Chau Loop area)

◇Conversion of industrial building: hard to meet long term demand

◇How much land do we need to increase DC service provision in short to medium term

◇Data center land supply policy needed

What we can do?◇Coordination to speed up land supply and cut red tape◇High quality infrastructure◇Space for DC companies to leverage on economies of scale and expand◇More value-added services e.g. IaaS ◇Support startups and local tech firms to grow SME demand for DC services and public cloud services◇Green data centers◇ Enhance cloud computing security for critical infrastructure◇Robust telecommunications infrastructure, Pro-Business environment, free flow of information, protection of data privacy, large pool of ICT professionals

Challenges ahead

◇Land supply◇Shorter lead-time to meet the needs of tech firms, financial institutions and telecom operators◇Staying relevant, advanced planning and better coordination◇Is DS high priority inside the government?◇Facilitate partnerships with global players to build new facilities◇Providing attractive incentive packages

Thanks!charlesmok@charlesmok.hk

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