Why Facebook bet US$1 billion on Singapore data centre
Tech firms are re-examining their operations as they face headwinds in Asian countries increasingly concerned with protecting their own data
Facebook’s announcement that it is investing more than US$1 billion in building a new data centre in Singapore underlines how multinational technology firms are re-examining their operations as they face regulatory headwinds in Asian countries increasingly concerned with protecting their own data and data flows.
The data centre, projected to start operations in 2022, is a testament to Facebook’s long-term commitment to Southeast Asia, home to 360 million users of the website. In choosing Singapore to host its first data centre in Asia, Facebook has confirmed the city state’s status as the region’s data storage hub, a status that owes much to its strong data and intellectual property protection laws.
DATA PRIVACY RULES
China, South Korea, India, Indonesia, Thailand, and Vietnam are among the Asian countries that have either recently passed or proposed regulations on data protection. Unlike Singapore, however, data privacy rules in these countries tend to be unbalanced. While they require internet companies to store citizens’ data on local servers, an act known as data localisation, these countries will also restrict cross-border data transfers, an essential practice in an increasingly borderless digital world.
“Cross-border data flow is essential for the development of the digital economy, which countries globally are seeing as the engine of growth for GDP, trade, job creation, innovation and productivity,” says Jeff Paine, managing director of the Asia Internet Coalition, an industry group whose members include Facebook, Amazon, Google, and Apple. “Governments should realise that not only do data localisation policies restrict opportunities for businesses to grow domestically and globally, but they, in fact, increase vulnerabilities and don’t address the core concern of cybersecurity.”