Introduction To Data Centers In Thailand and Why They Are So Important

11 May 2022

The need for data centers in Thailand has grown significantly in recent years and this trend is expected to continue for the foreseeable future.

Even before the emergence of Covid-19 the world was spending more and more time online, and the pandemic has only accelerated this process. From virtual meetings and distance learning to increased social media usage and online shopping, the internet has suddenly become more important than ever.

Thailand’s government has thrown its full support behind the development of 5G infrastructure, there is a burgeoning domestic AI and robotics industry, and we are seeing a boom in data-heavy fields like edge computing and the Internet of Things (IoT). All these sectors generate enormous amounts of data, most of which has to pass through a data center of some kind. This means there is greater need than ever before for data centers and the services they provide.

What Are Data Centers?

In the simplest terms, a data center is a space containing computer systems that store and share data. These systems include storage, IT equipment, and network infrastructure—crucial to facilitating the needs of modern businesses. In terms of size, a data center can be as small as a closet or even a chest of drawers, but nowadays they are typically warehouse-sized or bigger.

It’s vital to understand that almost everything that happens online happens in a data center. Sometimes you’ll hear a person saying they saved a photo or a file “in the cloud”, but this is just a term for describing data centers in general. The airy name might give you the impression that digital information exists in a kind of fifth dimension, but that is not the case. Data centers depend on very real physical infrastructure.


Why Do Companies Need Data Centers?

Companies are highly dependent on the computer systems that drive their business operations. For one thing, they need a secured facility with resilient infrastructure such as reliable and redundant power supply, cooling and connectivity. A company reliant on access to big data, for example, will suffer if their systems experience unplanned and regular outages. Companies also need to ensure their equipment is fit for purpose, that their costs are kept down, and that their data cannot be hacked.

Because of this, it makes sense for companies to outsource their IT needs to a data center. Data centers not only offer a highly reliable power source, but also security, cost-effectiveness, and access to cutting edge equipment.

Considerations for Data Center Location

Firstly, data centers need protection from the elements. Natural disasters are rare, but in high-risk locations it’s a matter of when they occur, not if. Physical events that can affect data centers include violent storms (such as typhoons and tornadoes), thunder and lightning (which can affect electrical supply), earthquakes, tsunamis, floods, landslides, volcanos, snowstorms, and fires.

A second consideration for any data center company relates to power supply. Reliable power is central to the running of any successful business; it should also be easily accessible, and data centers are often built close to power sources for this reason. And because electricity is the single biggest cost of running a data center, power must be cheap. In the US, for example, Washington state is a very popular choice for data center location because it has inexpensive, easily accessible, and abundant power generated by its many hydroelectric plants.

Finally, a data center company must consider economic factors. The cost to buy land and construct a data center is significant. Building a data center in central Singapore, for example, will cost more than building the same data center beside a dam in northern Laos. Does that mean it’s a good idea to locate a data center in a remote location with cheap real estate, far from any possibility of natural disaster? Not necessarily. Such places may not be able to provide access to the fiber optic cabling necessary for data centers to function. They are also less likely to have sufficiently qualified labor, and it can become expensive trying to attract talent. However, this can be offset by local government tax incentives, so there are several factors at play.

The Future

The world is marching toward a future in which data centers play an increasingly pivotal role. As such, it is essential to understand what data centers are, why they are so important for your business, and why location matters so much to them. Hopefully this article has shed some light on a topic which is so fundamental to the future of business.

For more information or enquiring about data center services in Thailand, please contact CBRE.