Princeton Digital to Spend $1 Billion on New Asian Data Centers

(Bloomberg) — Princeton Digital Group will spend $1 billion to build new data centers to support its operations in Singapore, underscoring long-term demand for the infrastructure that powers Southeast Asia’s fast-growing digital economy.

The Singapore-based company said the new campus it will build in Batam — an Indonesian island a few miles off the coast of the city-state — will allow its customers to expand their infrastructure as investment in the region grows. It has secured power for the 96-megawatt facility.

“Singapore will continue to play a major role in the internet in Asia as the digital hub,” Rangu Salgame, chief executive officer of the Warburg Pincus-backed company, said in an interview. “A billion dollars is the minimum we would be looking to spend, because that’s the kind of demand we’re seeing coming into Singapore in the next three to four years.”

The company is expanding also outside the region. In December, it said it was opening its first data center in India with an investment of $300 million, boosting its credentials as a pan-Asian operator.

Tech giants including Amazon.com Inc.’s AWS, Microsoft Corp. and Alphabet Inc.’s Google are facing intensifying competition in Southeast Asia, where Chinese rivals are stepping up investments.

In November, Huawei Technologies Co. announced an investment of $300 million to upgrade its cloud infrastructure in Indonesia. Alibaba Cloud in September said it would spend $1 billion to support global partners over the next three years.

Southeast Asia, home to Sea Ltd. and Alibaba Group Holding Ltd.’s Lazada, will see its digital economy reach $330 billion by 2025, according to a report published by Google, Temasek Holdings and Bain & Co. The region’s consumers are adopting mobile and online services at a rapid clip, creating newfound demand for cloud infrastructure and services. Data localization requirements across the region have also fueled demand for data centers.