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Elyssa Lopez · · 7 min readPH bets on local data centers. Can it handle the heat?
In October, the Philippines began begging its IT professionals to help it pressure large cloud services providers to “go local.”
Henry Aguda, secretary of the Philippines’ Department of Information and Communications Technology (DICT), made an impassioned plea: “I know you have access to the hyperscalers,” he said. “Please promote the Philippines … If we’re adopting AI, then the computing process should be here, too.”
Since then, Aguda, along with data center operators in the country such as Vitro Inc., have been drumming up support for the passage of a data localization policy in hopes of boosting the adoption of Philippine-based data centers.
Even Philippine President Ferdinand Marcos Jr. harped on the importance of a data sovereignty policy, after appearing at the opening of Vitro’s largest data center last year.
Image credit: Made by Miguel Cordon/Tech in Asia with the help of AI
Digital Edge, a regional data center operator which has a 10 megawatt data center in the Philippines, believes the lack of a data localization policy in the country is one of the reasons for the slow uptake of its capacity.
“In our other markets [in Southeast Asia], in that three-year period, we would have filled a data center of this size over that time,” William Dew, head of country sales and revenue operations of Digital Edge, tells Tech in Asia.
Data centers usually measure their capacities based on the amount of energy their facilities consume. One megawatt can power about 830 homes at any given time.
How the final version of the policy will look remains to be seen, but its intent is simple: mandate the storage and processing of “sensitive data” in the Philippines.
Depending on the definition of sensitive data, that could mean that when an ordinary Filipino accesses ChatGPT – or if a local bank tapped the services of Gemini – those AI providers would be required to process that information locally.
But they’re already here, right?
To be sure, hyperscalers do have a presence in the Philippines. Chinese cloud providers Alibaba Cloud and Huawei Cloud have local data center partners, while the chips used to power Amazon Web Services and Microsoft Azure’s AI services are located in Singapore.
Most data centers in the Philippines say local enterprises are their main clients, but the demands of these customers do not require the gigawatt levels of computing power that hyperscalers usually do.
Philippine President Ferdinand Marcos Jr. (center) visits the VITRO Inc. data center in Sta. Rosa, Laguna. / Photo credit: Presidential Communications Office
The wrong time to move?
The road to data sovereignty
Will it work?
Can the Philippines’ infrastructure manage it?
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Operators hope that a data localization policy will push hyperscalers to tap their services, but the country’s energy infrastructure may dash those dreams.
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