Microsoft bets big on Southeast Asia, promises billions in investments in AI and cloud

MICROSOFT Chairman and CEO Satya Nadella toured three Southeast Asian countries last week from April 30 to May 2, with each stop leading to significant investments and upskilling initiatives .

His high-level visit follows Apple chief Tim Cooks' tour of Asia, Indonesia, Singapore and Vietnam last month, and Nvidia CEO Jensen Huang's trips last December to Malaysia, Singapore and Vietnam.

Microsoft is competing with companies like Google, Amazon and Nvidia to expand its presence in Southeast Asia, a fast-growing region that is seeing increasing demand for these companies' services.

Here's a look at what happened in each country Nadella visited and how Microsoft's latest investments compare to those of its competitors.

First stop: Indonesia

Nadella's first stop was Indonesia, where Microsoft announced it would invest $1.7 billion over the next four years in new cloud computing and artificial intelligence (AI) infrastructure, as well as AI training opportunities for 840,000 people.

It is the largest investment made by the company in the 29-year history of Southeast Asia's largest economy.

Last month, Nvidia and Indonesian telecommunications company PT Indosat Ooredoo Hutchison announced plans to build a $200 million AI center in Central Java this year.

And in December 2021, Amazon Web Services (AWS), Amazon's cloud computing platform, committed to investing $5 billion in Indonesia over the next 15 years, launching its first cloud infrastructure region for the country.

Second destination: Thailand

Two days later, Nadella was in Bangkok where Microsoft announced the opening of its first data center region in Thailand to expand the availability of the company's hyperscale cloud services.

The move follows growing demand for cloud computing services in Thailand from enterprises, local businesses and public sector organizations, Microsoft said.

Thai Prime Minister Srettha Thavisin hailed the announcement as an important step in the kingdom's aspiration to become a regional center of the digital economy.

In August 2022, Google announced plans to introduce a new Google Cloud region in Thailand, but did not provide further details.

In October 2022, AWS pledged an estimated investment of $5 billion in Thailand over 15 years to strengthen its cloud infrastructure.

Last stop: Malaysia

The next day, May 2, Microsoft revealed plans to invest $2.2 billion in Malaysia over the next four years.

The largest investment in Microsoft's 32-year history in the country includes building cloud and AI infrastructure, creating AI skills opportunities for an additional 200,000 people, and creating a national center of excellence in AI.

This won't be Microsoft's first foray into the Southeast Asian country.

In April 2021, it announced plans to establish its first data center region in Malaysia, which has the distinction of being the premier data center investment destination in Southeast Asia.

The country has received data center-related investments amounting to RM76 billion (S$21.7 billion) from 2021 to March 2023, says the Minister of Investment, Trade and Industry , Tengku Zafrul, in August 2023.

He added that Malaysia aspires to become a data center hub not only in Southeast Asia, but also in the whole of Asia.

As part of a cabinet reshuffle last December, Malaysia separated its Ministry of Digital from the Ministry of Communications and Digital Affairs to meet growing demand within the country's digital space.

In August 2022, Google, like in Thailand, announced plans to introduce a new Google Cloud region in Malaysia, also without providing details.

In March last year, AWS committed to investing $6 billion by 2037 to strengthen its cloud infrastructure in Malaysia.

Last December, YTL Power International, the utility unit of Malaysian conglomerate YTL, announced its partnership with Nvidia to develop AI infrastructure in Malaysia.

The deal would include collaborations in building supercomputers and a large language model in Malay.