Singapore Telecommunications Ltd (SingTel) said on March 20 it has earmarked US$20 million in the next 12 months for the management and operation of two data centres in Hong Kong.
The project is part of a regional initiative by the Singapore telecoms giant to meet a growing demand among multinational corporations and Internet-based businesses to outsource some services.
Under the project, SingTel aims to provide the communications network operations, application services and Web hosting needs of companies which prefer a third-party source rather than spend more money on infrastructure and equipment.
The US$20 million investment will be used to develop, manage and operate the two data centres in Hong Kong, including a new 13,500-foot (1,215 square meters) facility in Chai Wan, the company said in a statement.
"SingTel's strategy is to grow its data and corporate business outside of Singapore," the statement said.
It said SingTel expects annual revenue from providing managed hosting services in the Asia-Pacific region to reach US$70 million by 2004, with Hong Kong seen to contribute 10-20 percent of total revenues.
The Chinese special administrative region is one of SingTel's top regional markets in addition to Singapore and Australia.
SingTel's regional network currently comprises 10 data centres covering Singapore, Australia, Japan, South Korea, Chinese Taipei and Hong Kong SAR, with services also available on the Chinese mainland, Thailand and Indonesia through alliances with local partners.
These centres are linked via the company's pan-Asian submarine cable network.
SingTel chief executive Lee Hsien Yang said that by 2003, up to 70 percent of multinational corporations would be outsourcing at least parts of their information technology operations to a third party.
"Despite the perceived oversupply of data centers in the region, there is really a lack of experience and truly global service players who are capable of providing advanced and comprehensive managed network services," Lee said.
SingTel, seeking to grow beyond the small domestic market, has acquired Australia's Cable and Wireless Optus -- now named SingTel Optus -- for US$9 billion last year.
It also has major investments in the Advanced Info Services of Thailand, the Bharti Group in India, Globe Telecom in the Philippines and Telkomsel in Indonesia.
(Xinhua News Agency March 21, 2002)
