Last month we hosted a panel event with IT Infrastructure experts talking about colocation, managed hosting, cloud services and security services on a global scale (the video stream can be found in this blog post). A lot of the conversation surrounded the new economic giant of the world, China.
When it comes to data center trends in China one thing stands out, many enterprises are using Hong Kong as an entry into the strict Chinese market. Hong Kong is being called the ‘gateway’ to China’s data center space. Chinese companies are using China’s Special Administrative Region to test the waters before moving further west and European and American companies are starting to do the reverse. In Hong Kong, companies will find less stringent internet and data privacy restrictions compared to mainland China.
According to Structured Research, Hong Kong’s colocation market generated US$616 million (HK$4.8 billion) in 2015. It is projected to grow by 15% in 2016, and is expected to reach US$1.39 billion (HK$10.8 billion) by 2020.
Data centers in Hong Kong are mainly found in five clusters:
- Tseung Kwan O Industrial Estate in Tseung Kwan O
- New Territories North (including Shatin, Fotan, Fanling and Taipo)
- Kowloon East (including San Po Kong and Kwan Tong)
- Kowloon West (including Tsuen Wan and Kwai Chung)
- Hong Kong Island
Most of the data center capacity — about one-third — is in Tseung Kwan O. As of 2015, there are about 38 data center providers with 53 unique operational data centers across its 400-plus square miles of land. The city has 1.9 million square feet of total data center space, total rack capacity of 59,000 racks, and total critical power capacity of 208MW.
The top four data center providers in Hong Kong, according to the Structured Research report, are Equinix, NTT Communications, and PCCW Solutions and iAdvantage, a subsidiary of SUNeVision. Together, these four companies contribute to two-thirds of the total market share.
Check out this article for more information on the importance of the data center market in Hong Kong and this article for a list of do’s and don’ts for starting business relationships in China.
The bottom line, there are a lot of restrictions, both with space and government policies, on building new data center space in Hong Kong but there is a lot of built out space currently available to savvy companies that are looking to do business in China.
For help with low pricing benchmarks in Hong Kong and the best data center or cloud providers to fit your specific business needs, contact one of our infrastructure experts here.
