May 8, 2023 - [HO CHI MINH CITY] Vietnam’s data centre (DC) market is thriving like never before, with both local and foreign companies looking to develop more DCs in the South-east Asian country as demand for data storage continues to grow.
A key reason is the implementation of a new data localisation rule in Vietnam last year, which has resulted in increased activity in DC investments.
The decree – put into force last October to provide guidance on the implementation of Vietnam’s 2018 Cybersecurity Law – mandates that all local companies and certain foreign firms that provide services in areas like telecommunications, e-commerce and online payments must store specific types of data in Vietnam for at least 24 months.
In Vietnam, foreign companies currently hold a roughly 80 per cent share of Vietnam’s cloud-computing market. Of this, Amazon Web Services accounts for 33 per cent, while Google and Microsoft have 21 per cent each. Six of the seven most popular social media apps in Vietnam also belong to foreign tech giants, such as Meta and ByteDance.
This suggests that locally-generated data is primarily stored, transferred and processed at some DC hubs outside the country, though an electric replica of regulated data is still required at local infrastructures.
Vietnam’s digital economy as a whole grew 28 per cent year on year to reach US$23 billion in 2022. In a report by Google, Temasek and Bain & Company, Vietnam is poised to become the fastest-growing digital economy in South-east Asia with an annual growth rate of 31 per cent between 2022 and 2025.
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