Dive Brief:
- Amazon activated the AWS Asia Pacific (Malaysia) Region Thursday, expanding its global cloud footprint with the addition of three availability zones in Malaysia. The hyperscaler plans to invest more than $6.2 billion to support the infrastructure through 2038, according to the announcement.
- The Malaysia cloud zones bolster an existing network of 13 APAC regions spanning Beijing, Hong Kong, Seoul, Sydney and Tokyo. AWS now operates 108 availability zones in 34 geographic regions globally with plans underway to open additional regions in Mexico, New Zealand, Saudi Arabia, Taiwan, Thailand and Europe.
- As AI consumption drives data center spending towards a projected $1 trillion in the next five years, AWS’ hyperscaler rivals are also building out in Malaysia. Microsoft and Google Cloud announced infrastructure investments of $2.2 billion and $2 billion, respectively, in May.
Dive Insight:
Infrastructure investments in Malaysia are part of a broader hyperscaler building boom. AWS and its two biggest rivals are pouring tens of billions of dollars on data center construction to satisfy enterprise demand for cloud services and absorb the anticipated surge in AI workloads.
The three providers control more than two-thirds of the global cloud market, according to Synergy Research Group analysis published Wednesday. AWS is the dominant player with 32% of the market, followed by Microsoft and Google Cloud at 23% and 12%, respectively.
Amazon, Microsoft and Google dominate two-thirds of the cloud market
Hyperscaler market share by percentage, per quarter
“The mainstream cloud market is a game of huge scale,” John Dinsdale, SRG chief analyst and research director, said in an email. “In order to stay at the forefront of rapidly changing technologies, and to then be able to deliver leading edge services to multinational enterprises and to clients all around the world, requires enormous levels of funding and a long-term corporate commitment and focus.”
The three largest hyperscalers now operate a global network of more than 560 data centers, according to SRG. Together, they reported more than $48 billion in capital expenditures in the second quarter, most of which went towards “building, equipping and updating data centers and associated networks,” Dinsdale said.
There are 510 additional hyperscale cloud facilities in the planning and construction pipeline, according to SRG research.
