Alphabet’s Google is considering building a large data centre in Vietnam, a person briefed on the plans said, in what would be the first such investment by a big U.S. technology company in the Southeast Asian nation.
Google is weighing setting up a “hyperscale” data centre close to Ho Chi Minh City, Vietnam’s southern economic hub, the source said, declining to be named because the information was not public.
The investment, the size of which the source did not specify, would be a shot in the arm for Vietnam, which has so far failed to attract major overseas capital in data centres due to its patchy infrastructure, with large tech companies preferring to house their centres in rival nations in the region.
It was not clear how quickly Google would reach a decision on an investment, but the source said internal talks were taking place and the data centre could be ready in 2027.
A spokesperson for Google declined to comment about the data centre plan.
Hyperscale centres are the largest in the industry, with power consumption usually similar to that of a big city.
A hyperscale data centre with power consumption capacity of 50 megawatts (MW) could cost between $300 million and $650 million, according to estimates based on data published by real estate consultant Jones Lang LaSalle in a report this year on data centres in Vietnam.
Google’s move was motivated by the large number of its domestic and foreign cloud services clients in Vietnam and the country’s expanding digital economy, the source said, noting the Southeast Asian nation was one of the fastest-growing markets for YouTube, Google’s popular online video sharing platform.
Currently the top data centre operators in Vietnam, based on computing space, are industrial investment firm IDC Becamex and telecommunications company VNPT, both Vietnamese state-owned enterprises, according to an internal market report by an industrial park in Vietnam seen by Reuters.
The Nikkei reported in May that Chinese e-commerce company Alibaba was considering building a data centre in Vietnam. Alibaba declined to comment on the matter on Thursday when contacted by Reuters.
GROWTH STRATEGY
Despite growing demand for digital services from Vietnam’s 100 million population, foreign investors in the sector have largely shunned the country because of occasional power shortages, less attractive investment incentives and weak internet infrastructure which relies on a handful of ageing subsea cables, according to industry experts.
