Report

The Indonesia Data Center Storage Market size is estimated at USD 0.78 billion in 2024, and is expected to reach USD 1.7 billion by 2030, growing at a CAGR of 14.03% during the forecast period (2024-2030).

The increasing demand for cloud computing among SMEs, government regulations for local data security, and growing investment by domestic players are some of the major factors driving the demand for data centers in the country, leading to a growing need for data center storage equipment.

Key Highlights
-The upcoming IT load capacity in the region is expected to reach over 1,400 MW by 2029 for under construction IT load capacity.
-The construction of raised floor areas for data centers in the country is expected to reach 4.3 million sq. ft by 2029 for under-construction raised floor space.
-The country's total number of racks to be installed is expected to reach over 218,000 units by 2029.
-Currently, 15 submarine cable projects are under construction in the country. One such submarine cable, estimated to start service in 2024, is Apricot, stretching over 11972 kilometers with landing points Batam and Tanjung Pakis for planned submarine cables.


Indonesia Data Center Storage Market Trends

IT & Telecommunication Segment to Hold Major Share in the Market


- This growth in 4G and 5G smartphones and affordable data packs is projected to drive data consumption among the populace, thus impacting the Indonesian data center market positively. As more smartphones were sold, average screen time increased from 45 minutes in 2016 to 5 hours in 2022. This change in smartphone usage patterns is also triggered by the ease of services by various digital apps, which rely on either cloud or data centers to provide their services. This increases the use of data centers and storage devices in data centers, positively impacting the market.
- There has been a recent uptick in migration to the cloud as companies transition to more flexible digital workplaces to accommodate increased online demand and remote work. The cloud is the foundation of digital transformation. Thus, cloud services are based in data centers. Therefore, the transition to enterprise cloud is driving the growth of the domestic data center market, thereby increasing the market value of data center storage equipment.
- The COVID-19 pandemic had a major impact on data traffic growth per smartphone. For instance, OTT consumption increased by 35% from February 2020 to April 2020, where the average screen time increased to over three hours of online streaming content during the pandemic. This increase in data consumption has enforced the need for improvement in the existing data centers and the construction of new data centers to meet the growing demand for data storage and processing. This increases the use of data centers and storage devices in data centers, positively impacting the market.
- Increasing internet penetration, increased use of social networks, improved automation technology, smart city initiatives, and implementation of AI across industries are driving investment in data centers. As the number of data centers increases, so does the demand for data center storage in the country.
- The growing demand for the Internet in the country drives companies to establish new networks. In September 2022, Indonesian operator Indosat Ooredoo Hutchison (IOH) announced to broaden its service portfolio by launching a fiber-to-the-home (FTTH) service, branded Indosat HiFi, as it looks to capitalize on the growing demand for high-speed internet access at home. With the internet being the primary requirement for the smooth operation of any data center and the rise in average broadband speed, predominantly FTTx, and with improvement in digital infrastructure in the eastern region of the country, data center construction projects are expected to be more focused in the country during the forecast period. As the number of data centers increases, so does the demand for data center storage in the country.


Hybrid Storage Expected to Hold Significant Share


- The combination of on-premises and cloud storage solutions is known as data center hybrid storage. This approach takes advantage of the best of both environments and provides the flexibility to store and manage data on-premises and in the cloud. For instance, the Chinese cloud service provider Tencent Cloud launched an internet data center (IDC) in Jakarta, Indonesia, enabling faster data transfers and accelerating the digital transformations of various industries. This move also allows the company to be closer to Indonesian users and to maximize cloud computing potential with the IDC. It reduces access delays to data and applications, helping businesses and organizations in the country accelerate their digital transformation in the future. This enables the use of hybrid storage for processing the data.
- To ensure data integrity and legal compliance, enterprises can use these hybrids to tailor their storage strategies to specific legal requirements. This incorporates using hybrid storage for data centers, increasing the need for data storage in the country.
- As businesses continue to grow, data centers are expanding and adapting to meet the growing connectivity needs of various industries and increasing use of the internet. Businesses increasingly rely on hybrid infrastructure and cloud capabilities as they seek flexibility, scalability, and remote work capabilities. Data traffic is increasing, and the need for storage for businesses seeks importance, increasing the market value for hybrid storage solutions.
- The rise of cloud storage and audio conferencing services has led more companies to adapt to remote work. This has given rise to data centers that use hybrid storage that combines the functionality of hard drives and SSDs. Cache is used for frequently accessed data, so it takes advantage of the fast access capabilities of an SSD and the greater storage capacity of a hard drive.
- The combination of on-premises and cloud storage solutions is known as data center hybrid storage. This approach takes advantage of the best of both environments and provides the flexibility to store and manage data on-premises and in the cloud. For instance, the Chinese cloud service provider Tencent Cloud launched an internet data center (IDC) in Jakarta, Indonesia, enabling faster data transfers and accelerating various industries' digital transformations. This move also allows the company to be closer to Indonesian users and to maximize cloud computing potential with the IDC. It reduces access delays to data and applications, helping businesses and organizations in the country accelerate their digital transformation in the future.


Indonesia Data Center Storage Industry Overview

The Indonesian data center storage market is moderately fragmented. The major players in this market hold the majority of the market share. Some significant players are Dell Inc., NetApp Inc., Huawei Technologies Co. Ltd, Kingston Technology Company Inc., and Lenovo Group Limited. These companies leverage strategic collaborative initiatives to increase their market share and profitability.

In February 2023, NetApp launched NetApp AFF C-Series, a new family of capacity flash storage options that deliver lower-cost all-flash storage, and NetApp AFF A150, a new entry-level storage system in the AFF A-Series family of all-flash systems. Alongside introducing the new NetApp AFF C-Series, a mid-range all-flash storage system, the company also launched NetApp Advance, a new portfolio of programs and guarantees for data storage.

Additional Benefits:

- The market estimate (ME) sheet in Excel format
- 3 months of analyst support