DE-CIX launches into South East Asia

DE-CIX launches into South East Asia

03 December 2019 | Jason McGee-Abe

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DE-CIX has now expanded its global interconnection model to its most eastern point to date. Jason McGee-Abe speaks to Ivo Ivanov, DE-CIX’s international CEO.

Ivanov joined DE-CIX back in January 2007 and ever since then has been deeply involved in the establishment of DE-CIX sites in Istanbul, Palermo, Madrid, Marseille, New York, Dallas, Dubai (UAE-IX), as well as Mumbai (Mumbai IX ), and several DE-CIX consultancy projects in Africa, Asia, and Europe.

DE-CIX’s internationalisation strategy has been continually enhanced and, as I write this, the company has just announced its plans to launch operations in Malaysia after partnering with local internet exchange provider Johor Bahru Internet Exchange (JBIX). The deal will see the companies co-run two internet exchanges in the greater Kuala Lumpur and the Johor Bahru regions of Malaysia.

This is big news for DE-CIX as it marks the internet exchange operator’s first venture into South East Asia and Ivanov tells Capacity that it is just the first of many markets. “It’s just the start of the chain,” the CEO of DE-CIX International tells me.  

“DE-CIX will also look to enter other markets around Malaysia over the next 12-24 months.”

DE-CIX Malaysia

“After successfully establishing leading IXs in Europe, North America, India, and the Middle East, DE-CIX is now taking its almost 25 years of experience to South East Asia,” says Ivanov. “Malaysia is one of the most vibrant markets in the world.”

Forming a joint venture with Starwing Technologies, the company has created a new carrier and data centre-neutral JV vehicle, DE-CIX Malaysia, which will be headquartered in Kuala Lumpur and will collectively take over the JBIX. JBIX is an open and carrier-class IX that has been operational since 2018. As of today, it serves close to 50 regional networks and Ivanov divulges that since the DE-CIX announcement a number of financial enterprises have expressed interest in using interconnection services at JBIX.

Malaysia is just the first step as DE-CIX has identified more opportunities in South East Asia “to enable more and more markets around Singapore”. The plan is to develop these local markets and the connections with Singapore, whilst maintaining a very robust and distributed platform that will be constantly developed over the years. DE-CIX has created interconnection hubs worldwide in regions where customers are in need of easy-to-access interconnection services.

“Whilst Singapore has been a major content hub for the region over the last decade, the key content and cloud-computing players have started to extend their footprint throughout ASEAN – including in Malaysia,” he states.

Asia Expansion Plans

Singapore and Hong Kong are and will remain two of the key hubs in the ASEAN market, Ivanov says. He does stress that this heavy concentration will inevitably become redistributed within the region, in particular with surrounding markets.

“We believe that around 80% of relevant telecommunications concentration in Singapore will reduce over the years,” Ivanov tells me. “It will never lose its key hub status but new emerging markets will gradually create their own hubs.”

Alongside Malaysia, DE-CIX has identified the Philippines, Vietnam, Indonesia, and Thailand as other South East Asian markets that have great potential to become their own hubs. “It won’t happen tomorrow but, within the next couple of years, these countries will evolve quickly, based on population, business and economic growth,” he says.

Over the next few years, more and more operators will look to create further points of presence (PoPs) in cities such as Kuala Lumpar, Johor Bahru, Jakarta, Manila, Ho Chi Minh City, and Hanoi, he says.

“There are millions of users around these two markets, which operators, especially the international global ones, want to have access to. The demand for low latency and the huge traffic volumes driven by video, payments, gaming and other applications like on-demand and live streaming of sports is vast.”

DE-CIX is helping to drive the demand for very low latency and high resiliency for interconnection infrastructure. “There is huge demand for interconnection and further services,” he says. Services such as FlexPOP, which is set to revolutionise how carriers can expand their on-net presence with a “first-of-its kind infrastructure-as-a-service (IaaS)”, will be made available across its assets in South East Asia.

The company has spoken to many of its global anchor customers about its plans. “Companies such as Amazon, Microsoft, Apple, and financial services firms and network operators share this vision with us and they want to support us in connecting to our platforms, which will appear in this part of the world,” says Ivanov. I enquire about Asian-based companies, such as Alibaba and Tencent, and Ivanov responds: “They are already part of the DE-CIX family and are connected to various DE-CIX platforms worldwide. They will follow us in these new markets, especially as they deploy heavily across South East Asia. We will certainly welcome them to all DE-CIX exchanges across South East Asia.”

If you want to create your own crystal ball for South East Asia in terms of growth, demands and requirements on the market, one only needs to look at the history and recorded growth of South Korea, Japan and China. The potential for DE-CIX in South East Asia is vast as is the markets its identified. A huge area of opportunity highlighted on my call with the former business and law school graduate is with enterprises.

Enterprise Federation

DE-CIX has been growing its geographical presence at two levels: one is from a wide-scale global point of view and the other is within each of these locations, at the local level. The company is essentially bringing connected networks closer to the edge – right into regional data centres and as close as possible to end-users and enterprises.

Today, DE-CIX’s global infrastructure supports more than 1,700 networks but Ivanov highlights further opportunities that are in place for enterprises. DE-CIX has already been working hard on creating interconnection services for enterprises directly or indirectly with the cloud exchange in Europe and the US.
Ivanov explains how DE-CIX is set to strive helping enterprises to start using interconnection services. He hints that the company has already started looking at the potential of creating more specific industry and vertical interconnection groups designed for larger enterprises. I ask Ivanov for an example and he starts talking about the car manufacturing industry.

“Let’s take an automotive company, which has a connected car strategy. It wants to enable the cars with excellent in-network services in terms of data delivery into the car but also data usage created from thousands of sensors out of the car,” he explains. Manufacturers will want to control the data flow in and out of the car and DE-CIX is bound to see demand here for interconnection services.

All manufacturers need to create new digital assets to stay relevant. This is valid for other sectors too, such as healthcare and finance services. Digital strategies and new assets will give them the chance to differentiate themselves amongst the competition and to grow their relevance as a digital company. Creating assets is just one part but how to monetise these assets is a big topic. “The manufacturer wants to control the data in and out of the car as they want to monetise these assets,” Ivanov continues. “It’s a billion-dollar business. How can they do it though? They must have control and increase the quality. The network operator of a car company has to be involved in this and has to control this. That means DE-CIX will offer these type of organisations with interconnection federations, which may be like closed user groups, run and owned in accordance with the terms of compliance, data privacy or security. A car manufacturer can then invite all those network operators that want to interconnect with the car or receive and use data out of the car created by the thousands of sensors.”

DE-CIX is looking to create and offer pre-designed interconnection federations for different sectors. A huge benefit of such a framework is that an enterprise is essentially establishing its own private interconnection platform, helping to establish thousands of relationships and scrapping the need to close thousands of different bilateral agreements.

DE-CIX is playing a significant role in the world today. Its Asian expansion, coupled with the development of new services, partnerships and enterprise federations, is repositioning the internet exchange operator in a new digital age.