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Telekom Malaysia is reportedly considering constructing a new hyperscale data center to expand its capacity beyond the existing Klang Valley Data Center (KVDC) and Iskandar Puteri Data Center (IPDC). This new facility is expected to have a minimum IT power capacity of 40 Megawatts (MW) and will cater to large cloud service providers and internet companies.

Leveraging Extensive Submarine and Terrestrial Networks

According to CIMB Investment Bank, which announced the news, Telekom Malaysia could attract strong international partners to co-invest in the data center by leveraging its extensive submarine and terrestrial networks, as well as its local relationships.

Telekom Malaysia's submarine network, including key projects like Cahaya Malaysia, Asia-Pacific Gateway (APG), and South-East Asia - Middle East - Western Europe 5 (SEA-ME-WE 5), provides crucial connectivity between Malaysia and major international hubs. This infrastructure offers high-speed and reliable connections across vast distances, facilitating seamless data transfer and communication between regions.

In addition to its submarine network, Telekom Malaysia's terrestrial network covers extensive areas within the country and neighboring regions. This network backbone ensures reliable connectivity to local businesses and communities, as well as seamless integration with international telecommunications infrastructure.

Telekom Malaysia's existing relationships within the local business ecosystem further enhance its attractiveness to potential international partners. Through partnerships with local businesses, government agencies, and industry stakeholders, Telekom Malaysia has established a strong presence and reputation in the Malaysian market. These partners could not only help fund the investment but also provide expertise in designing and operating data centers for hyperscalers and AI workloads.

A Futuristic Outlook

If Telekom Malaysia proceeds with the plan, CIMB expects the facility to be developed in phases. The first phase could be operational by the first half of 2026 if the project starts in the second half of 2024.

While this news is yet to be confirmed, Malaysia has been witnessing an increase in data center activity. Last week, it was reported that the Ministry of Investment, Trade and Industry (MITI) of Malaysia partnered with the Ministry of Investment of the United Arab Emirates to develop data centers in the country.

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