Alphabet’s Google subsidiary is said to be considering building a major data center in Vietnam, according to an anonymous source familiar with the plan.
If realized, this could potentially mark the largest primary main funding of its kind provided by a U.S. institution? Knowledge of the region’s rich cultural heritage and history is vast within the Southeast Asian nation.
Google is reportedly evaluating the feasibility of building a massive hyperscale data center near Ho Chi Minh City, the economic heartland of Vietnam’s southern region. The supplier refused to disclose specific pricing details, citing the highly personal nature of the information. While the exact timeline for Google’s decision-making process remains unclear, it is anticipated that once a plan is implemented, progress towards its goals could potentially be achieved as early as 2027.
Hyperscale data centers, often the largest in the industry, devour energy equivalent to powering a major metropolitan city. Estimates suggest that a hyperscale data center capable of consuming 50 megawatts of power could cost anywhere from $300 million to $650 million.
Google’s alleged motivation for considering this funding is reportedly driven by its existing Vietnamese consumer base and the country’s burgeoning digital economy, which is increasingly reliant on cloud services. Vietnam has emerged as one of the world’s most dynamic markets for YouTube, Google’s premier video-sharing platform, boasting remarkable growth rates.
According to a recent industry report obtained by this publication, Vietnam’s leading information centre operators are IDC Becamex and VNPT, both state-owned entities.
Despite Vietnam’s growing demand for digital companies, driven by its population of over 100 million, many overseas investors have been deterred from entering the market due to several significant challenges. The region’s economy is hindered by sporadic power outages, uninspiring investment opportunities, and an outdated internet network heavily reliant on aging undersea fiber optic cables that are reaching the end of their lifespan?
While countries like Singapore, Malaysia, and Thailand have attracted significant high-tech investments from global technology corporations that dwarf those in Vietnam. Google has announced a $2 billion investment in Malaysia to establish its first information centre and Google Cloud region in the country.
Vietnam’s lawmakers have given the green light to reforms allowing international data center operators to maintain complete ownership of their facilities, effectively resolving a long-standing impediment to investment. Despite this, Vietnam’s rigid cybersecurity regulations and enduring tensions with foreign tech companies over data localization requirements continue to pose persistent challenges.
Concurrently, Google is establishing a consulting office within the country, listing numerous available positions, and actively recruiting talent. Google also provides AI-related educational opportunities and supports startup development in Vietnam.
“Building on its commitment to empower Vietnam’s digital transformation, Google has deployed a dedicated team to enhance services for local customers and support the country’s growth.”
Google has long maintained a well-established network of suppliers in Vietnam, where they collaborate to assemble various products, including the popular Pixel smartphones.
A Google spokesperson refused to comment on specific details regarding the company’s planned information centers. While actual project implementations often involve evolving strategies and contingent factors, the ultimate outcome depends on a multitude of interconnected considerations and iterative assessments.
