AWS to launch $6 billion cloud region in Malaysia as SEA competition heats up

AWS has announced plans to build a new infrastructure region in Malaysia as part of its plans to invest $6 billion into Malaysian operations by 2037. The cloud giant has already established a foundation in the country and is looking to build on it with the new region.

Among the main AWS users in the country include Petronas and Bank of Islam Malaysia as well as a host of public services and academic institutions. The company noted that its motivation for establishing the new region is to help with data sovereignty and help its customers within South East Asia (SEA) achieve even lower latency.

“We look forward to helping Malaysian institutions, startups, and companies deliver cloud-powered applications to fuel economic development across the country and to spur job creation, skills training, and educational opportunities in the communities surrounding our data centres,” Prasad Kalyanaraman, vice president of infrastructure services at AWS, said.

The announcement comes against the backdrop of the company’s increased expansion worldwide. AWS already has cloud infrastructure in 31 geographic locations and has plans for five more cloud regions in Canada, Israel, and New Zealand.

In terms of the wider SEA region, the company has already pledged a $5 billion investment over the next 15 years including a new region in Bangkok.

South East Asia is a hot market right now and all the major cloud providers are scrambling for a piece of it. Google Cloud has already announced plans to launch a new region in Thailand as well as venturing into Malaysia. Microsoft Cloud, on the other hand, is already a household name in Singapore.

But, despite the best efforts from the three cloud giants, it is the Chinese-backed cloud providers that seem to be winning in the region.

Tencent, Alibaba Cloud, and Huawei Cloud are already on an aggressive campaign to dominate the SEA market with Alibaba Cloud, the biggest of them all, pledging to invest $1 billion to back its SEA expansion. That is on top of establishing its international headquarters in Singapore early this year.

Huawei has also made plans to invest $300 million in expanding cloud operations in Indonesia to add to to its already solid presence in Thailand and Malaysia.

A recent analysis of the number of ‘availability zones’ from the Wall Street Journal shows that combined, Huawei, Alibaba, And Tencent command more availability zones in Southeast Asia than their American counterparts.

Expectedly, pricing is a major distinguishing factor in this scramble for the SEA market. According to organisations in the region, the Chinese Cloud providers have been able to attract more businesses by offering prices that are 20% to 40% lower than the American hyperscalers.