Oracle to advance Indonesia cloud services plan

[JAKARTA] Oracle will partner with DayOne Data Centers Singapore to establish its first cloud services centre in Indonesia, people familiar with the matter said, boosting its partnership with a key regional operator that counts TikTok owner ByteDance as its largest customer. 

The American tech giant will lease DayOne’s data centres located at Nongsa Digital Park on the Indonesian island of Batam, according to the people, who asked not to be identified discussing information that’s private. Oracle will be the sole tenant at DayOne plots that could support facilities with at least 120 megawatts of power, they said.

A 120 megawatt data centre typically requires a capital investment of at least US$1.2 billion, depending on factors like location, design tier and land costs, and whether the facility is built for hyperscale AI workloads.

Oracle’s expansion confirms an earlier Bloomberg News story that it was in discussions to establish a cloud services centre in Indonesia. Representatives for Texas-based Oracle didn’t immediately respond to a request for comment.

Singapore-headquartered DayOne earlier this year was spun out of Chinese data centre operator GDS Holdings, which retains a stake. ByteDance is far and away DayOne’s largest customer, according to research firm SemiAnalysis, with Oracle coming in second. DayOne also didn’t respond to a request for comment.

Nongsa Digital Park in Batam is already home to several other data centres, drawn by factors including the island’s free-trade zone status and its proximity to Malaysia and the wealthy city-state of Singapore. Oracle currently has two cloud computing centres in Singapore and last year announced a US$6.5 billion plan to build a similar facility in Malaysia. 

US tech giants from Meta Platforms to Google are building data centres across Asia to support an envisioned global boom in artificial intelligence services. Much of that investment has gone to countries with better-established tech ecosystems and networks, such as Malaysia and Singapore, where Salesforce recently announced a US$1 billion investment.

Bain estimates that the global market for AI-related products could hit US$990 billion by 2027 as the technology’s adoption disrupts the way companies and countries do business. OpenAI is also leasing a huge amount of computing power from Oracle as part of its Stargate initiative – OpenAI’s project with partners including Oracle and SoftBank Group to invest US$500 billion in AI infrastructure – to build data centres on American soil and overseas. BLOOMBERG