Microsoft SEA blitz rolls on with US$2.2b cloud/AI pact in Malaysia

Microsoft SEA blitz rolls on with US$2.2b cloud/AI pact in Malaysia

Hot on the heels of similar announcements in Indonesia and Thailand, Microsoft announced an even bigger deal in Malaysia on Thursday, pledging to invest US$2.2 billion over the next four years in new cloud and AI infrastructure in the country.

On the third leg of its Microsoft Build: AI Day tour across southeast Asia, Microsoft said at its event in Kuala Lumpur that the multi-billion dollar investment is the single largest investment Microsoft has made in Malaysia since it entered the country 32 years ago.

In addition to building cloud and AI infrastructure, the investment covers AI skilling opportunities for 200,000 people in the country, building up Malaysia’s developer community, and partnering with the government to establish a national AI Centre of Excellence, as well as enhance the country’s cybersecurity capabilities.

Microsoft said the investment builds on its Bersama Malaysia initiative, announced in April 2021, to support inclusive economic growth. That initiative also included plans to establish Microsoft’s first data centre region in Malaysia.

That data centre has yet to be built. However, last month, Malaysian property development firm Crescendo Corporation Berhad (CCB) said that Microsoft had purchased a 102,560sqm plot of land in Johor, which has become a hotbed of data centre development in Malaysia. According to CCB, Microsoft bought the plot for a cash consideration of RM132.4 million (US$27.8 million).

Microsoft made similar announcements earlier this week in Indonesia and Thailand in which it made major commitments to building cloud and AI infrastructure, as well as AI upskilling. For Indonesia, Microsoft said it would invest US$1.7 billion over the next four years in Indonesia. No financial details were given for the Thailand announcement, which also included the establishment of Microsoft’s first data centre region there.

Microsoft committed to building a data centre region in Indonesia in 2021, and says it is currently building data centres in West Java.

The AI skilling programmes included in all three announcements are part of a broader regional initiative announced by Microsoft on Tuesday. Under that initiative, Microsoft committed to providing AI skilling opportunities for 2.5 million people in Thailand, Indonesia, Malaysia, the Philippines and Vietnam by 2025 in partnership with governments, non-profit and corporate organizations, and communities in those countries.

Research from Kearney forecasts that AI could contribute nearly US$1 trillion to Southeast Asia’s GDP by 2030. According to the study, Thailand could potentially capture US$117 billion of that, while Indonesia could reap US$366 billion.

“The advent of ChatGPT created a new vertical in the startup world. As more companies embrace the power of AI, having the right digital infrastructure in Malaysia is key to future-proofing our nation’s economy,” said Malaysia’s economy minister Rafizi Ramli in a statement. “Microsoft’s investment will help accelerate the adoption of generative AI, building a pipeline of AI-driven startups, and benefitting our economy through increased productivity and higher wages.”


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