Equinix is expanding two of its Hong Kong data centers, planning to invest over $40 million on a third phase in the HK2 facility and a ninth phase in HK1. The expansion adds room in Hong Kong for close to 1,200 cabinets.
This is the latest in a series of expansions across Asia Pacific, all part of the colocation giant's wider global expansion effort. Other recent expansions in the region include building a $100 million data center in Sydney, its fifth in Australia, following the opening of a Melbourne facility late last year. The company also opened its largest facility in Singapore and Asia Pacific on the whole in March.
The expansion in HK2 is bigger of the two, adding 900 cabinets and bringing total capacity to 2,350, while the additional phase in HK1 will add 275.
There’s demand for data centers both from within Hong Kong -- Equinix cites demand from online media and video content providers in particular -- as well as demand internationally. Hong Kong and Singapore are considered the two main entry points into mainland China and the Asia Pacific market in general.
Hong Kong has high internet penetration, with 80 percent of the population connected and active online. More than two-thirds are active on social media and mobile platforms, respectively. In addition to end users, there is a great migration to cloud in some form or another across enterprises in general. Research firm IDC predicts the cloud market will grow 23 percent in 2015.
A high internet penetration rate means digital and media content companies want to serve in close proximity with low network latency, and Equinix's Hong Kong data centers are network dense.. The media and content customer base grew 16 percent year over year in 2014, according to Equinix.
"With the strong momentum of cloud and content companies deploying in Hong Kong, as well as data center services demand from worldwide customers including many in China, it was a clear strategic business decision to expand our presence in Hong Kong,” said Alex Tam, managing director, Equinix Hong Kong. “The investment in HK1 and HK2 further positions Hong Kong as an important regional hub, not only for financial services firms but for cloud and content companies as well."