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Vietnam’s CMC Telecom launches data centre subsidiary

Written by Wed 10 Jul 2024

Vietnamese telecom provider, CMC Corporation, has launched a new data centre subsidiary, CMC AI Digital Infrastructure (CMC ADI).

This subsidiary is dedicated to the construction and operation of hyperscale data centres. The new subsidiary will be headquartered in the Tan Thuan Export Processing Zone in Ho Chi Minh City.

The Board of Directors for CMC approved the resolution to establish the subsidiary earlier this month. Details are expected to be forthcoming at the company’s annual general meeting. Once investor approval is finalised, CMC general director Nguyen Trung Chinh will take on the duties of chairman and general director of CMC ADI, and the company can commence operations.

CMC Technology Group, CMC Telecom’s parent company, is the second-largest IT and telecommunications company in Vietnam. It has already invested heavily in building international-standard data centres in Hanoi and Ho Chi Minh City, holding 40% of the data centre market share for the banking industry.

Establishing a data centre-focused subsidiary aligns with CMC Corporation’s strategy of tapping into the Vietnamese data centre market which appears poised for strong growth in the near future.

Vietnamese Minister of Information and Communications, Ngyuen Manh Hung, emphasised the importance of data centre investment to accelerate digital transformation in the region.

“Without data centre investment, telecom operators will have no new growth space and will be replaced. Data centres must grow with cloud computing services, otherwise it will simply be leasing positions. Every three years, global data doubles and Vietnam’s data growth rate is even faster,” said Ngyuen Manh Hung.

Vietnam to Emerge as Data Centre Hub

To date, investment in the APAC data centre market has been focused on Tier I locations like Singapore, Tokyo, Sydney, and Hong Kong. However, as these markets become more saturated, investment in Tier II and III data centres is expected to grow.

Currently, Vietnam has 22 data centres spread across Ho Chi Minh City, Hanoi, and Da Nang. Several major tech companies have expressed interest in developing new data centres in Vietnam. Huawei, ST Telemedia, and Alibaba have announced their intent to invest in the country.

CMC Telecom’s data centres are renowned for their high standards of security and operational excellence. The company was the first in Vietnam to receive PCI DSS certification, a mandatory information security standard for businesses processing payment card transactions.

CMC Telecom’s Tan Thuan Data Center is the first in Vietnam to pass the Threat, Vulnerability, and Risk Assessment (TVRA), the highest security and risk prevention certification for data centres globally.

In May 2023, Huawei’s Data Center Product Manager, Do Van Chung, said Vietnam has the ‘opportunity to be a hub’ for data centre business, as the population’s Internet and social media usage booms.

Like many other countries, Vietnam recently passed a data localisation laws. As of October 2022, all domestic companies and foreign companies in certain industries must store data within the country’s borders for at least two years. This means that Vietnam needs more data centres to provide data storage and services to companies within the country’s borders.

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Written by Wed 10 Jul 2024

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