A large hallway with supercomputers inside a server room data center.
Luza Studios | E+ | Getty Images
Malaysia is emerging as a data center powerhouse in Southeast Asia and the continent more broadly as demand surges for cloud computing and artificial intelligence.
Much of the investments have been in the small city of Johor Bahru, located on the border with Singapore, according to James Murphy, APAC managing director at data center intelligence company DC Byte.
“It looks like in the space of a couple of years, [Johor Bahru] alone will overtake Singapore to become the largest market in Southeast Asia from a base of essentially zero just two years ago,” he said.
The report said the city has 1.6 gigawatts of total data center supply, including projects under construction, committed to or in the early stages of planning. Data center capacity is typically measured by the amount of electricity it consumes.
If all planned capacity comes online across Asia, Malaysia will only be surpassed by the larger countries of Japan and India. Until then, Japan followed by Singapore currently lead the region in terms of live data center capacity.
The index did not provide a detailed breakdown of data center capacity in China.
Shifting demand
The vast majority of data center infrastructure and storage investments have traditionally gone to the established markets of Japan and Singapore, as well as Hong Kong.
However, the global pandemic expedited the world’s digital transformation and cloud adoption, leading to surges of demand for cloud providers in emerging markets like Malaysia and India, according to a report from global data center provider EdgeConneX.
“Increased demand for video streaming, data storage, and anything done over the internet or on a phone, essentially means that there’s going to be more need for data centers,” said Murphy.
Booming demand for AI services also requires specialized data centers to house the large amounts of data and computational power required to train and deploy AI models.
While many of these AI data centers will be built in established markets such as Japan, Murphy said emerging markets will also attract investments due to favorable characteristics.
AI data centers require a lot of space, energy and water for cooling. Therefore, emerging markets such as Malaysia — where energy and land are cheap — provide advantages over smaller city-states like Hong Kong and Singapore, where such resources are limited.
Spillover from Singapore
Thus, a lot of investment and planned capacity has been redirected from Singapore to the bordering Johor Bahru over the years.
Singapore recently changed its tune and laid out a roadmap to grow its data center capacity by 300 MW on the condition more projects meet green-friendly efficiency and renewable energy standards. Such efforts have attracted investments from companies like Microsoft and Google.
Still, Singapore is too small for wide-scale green power generation, thus there remain a lot of limitations on the market, said DC Byte’s Murphy.
Resource strains
While the boom in data centers has helped lift Malaysia’s economy, it’s also created concerns about energy and water requirements.
Johor Bahru city council mayor Mohd Noorazam Osman reportedly said data center investments should not compromise local resource needs, given the city’s challenges with its water and power supply.
Meanwhile, a Johor Investment, Trade, and Consumer Affairs Committee official told ST that the state government would implement more guidelines on green energy use for data centers in June.
Signage at 23andMe headquarters in Sunnyvale, California, U.S., on Wednesday, Jan. 27, 2021.
David Paul Morris | Bloomberg | Getty Images
The House Committee on Energy and Commerce is investigating 23andMe‘s decision to file for Chapter 11 bankruptcy protection and has expressed concern that its sensitive genetic data is “at risk of being compromised,” CNBC has learned.
Rep. Brett Guthrie, R-Ky., Rep. Gus Bilirakis, R-Fla., and Rep. Gary Palmer, R.-Ala., sent a letter to 23andMe’s interim CEO Joe Selsavage on Thursday requesting answers to a series of questions about its data and privacy practices by May 1.
The congressmen are the latest government officials to raise concerns about 23andMe’s commitment to data security, as the House Committee on Oversight and Government Reform and the Federal Trade Commission have sent the company similar letters in recent weeks.
23andMe exploded into the mainstream with its at-home DNA testing kits that gave customers insight into their family histories and genetic profiles. The company was once valued at a peak of $6 billion, but has since struggled to generate recurring revenue and establish a lucrative research and therapeutics businesses.
After filing for bankruptcy in in Missouri federal court in March, 23andMe’s assets, including its vast genetic database, are up for sale.
“With the lack of a federal comprehensive data privacy and security law, we write to express our great concern about the safety of Americans’ most sensitive personal information,” Guthrie, Bilirakis and Palmer wrote in the letter.
23andMe did not immediately respond to CNBC’s request for comment.
More CNBC health coverage
23andMe has been inundated with privacy concerns in recent years after hackers accessed the information of nearly 7 million customers in 2023.
DNA data is particularly sensitive because each person’s sequence is unique, meaning it can never be fully anonymized, according to the National Human Genome Research Institute. If genetic data falls into the hands of bad actors, it could be used to facilitate identity theft, insurance fraud and other crimes.
The House Committee on Energy and Commerce has jurisdiction over issues involving data privacy. Guthrie serves as the chairman of the committee, Palmer serves as the chairman of the Subcommittee on Oversight and Investigations and Bilirakis serves as the chairman of the Subcommittee on Commerce, Manufacturing and Trade.
The congressmen said that while Americans’ health information is protected under legislation like the Health Insurance Portability and Accountability Act, or HIPAA, direct-to-consumer companies like 23andMe are typically not covered under that law. They said they feel “great concern” about the safety of the company’s customer data, especially given the uncertainty around the sale process.
23andMe has repeatedly said it will not change how it manages or protects consumer data throughout the transaction. Similarly, in a March release, the company said all potential buyers must agree to comply with its privacy policy and applicable law.
“To constitute a qualified bid, potential buyers must, among other requirements, agree to comply with 23andMe’s consumer privacy policy and all applicable laws with respect to the treatment of customer data,” 23andMe said in the release.
23andMe customers can still delete their account and accompanying data through the company’s website. But Guthrie, Bilirakis and Palmer said there are reports that some users have had trouble doing so.
“Regardless of whether the company changes ownership, we want to ensure that customer access and deletion requests are being honored by 23andMe,” the congressmen wrote.
A motorcycle is seen near a building of the Taiwan Semiconductor Manufacturing Company (TSMC), which is a Taiwanese multinational semiconductor contract manufacturing and design company, in Hsinchu, Taiwan, on April 16, 2025.
“TSMC is not engaged in any discussion with other companies regarding any joint venture, technology licensing or technology,” CEO C.C. Wei said on the company’s first-quarter earnings call on Wednesday, dispelling rumors about a collaboration with Intel.
Intel and TSMC were said to have been looking to form a JV as recently as this month. On April 3, The Information reported that the two firms discussed a preliminary agreement to form a tie-up to operate Intel’s chip factories with TSMC owning a 21% stake.
Intel was not immediately available for comment when contacted by CNBC on Wei’s comments on Thursday. The company previously said it doesn’t comment on rumors, when asked by CNBC about the reported discussions.
TSMC’s denial of tie-up talks with Intel comes as President Donald Trump is pushing to address global trade imbalances and reshore manufacturing in the U.S. through tariffs. The Department of Commerce recently kicked off an investigation into semiconductor imports — a move that could result in new tariffs for the chip industry.
TSMC reported a profit beatfor the first quarter thanks to a continued surge in demand for AI chips. However, the company contends with potential headwinds from Trump’s tariffs — which target Taiwan — and stricter export controls on TSMC clients Nvidia and AMD.
A motorcycle is seen near a building of the Taiwan Semiconductor Manufacturing Company (TSMC), which is a Taiwanese multinational semiconductor contract manufacturing and design company, in Hsinchu, Taiwan, on April 16, 2025.
Here are TSMC’s first-quarter results versus LSEG consensus estimates:
Revenue: $839.25 billion New Taiwan dollars, vs. NT$835.13 billion expected
Net income: NT$361.56 billion, vs. NT$354.14 billion
TSMC’s reported net income increased 60.3% from a year ago to NT$361.56 billion, while net revenue in the March quarter rose 41.6% from a year earlier to NT$839.25 billion.
The world’s largest contract chip manufacturer has benefited from the AI boom as it produces advanced processors for clients such American chip designer Nvidia.
However, the company faces headwinds from the trade policy of U.S. President Donald Trump, who has placed broad trade tariffs on Taiwan and stricter export controls on TSMC clients Nvidia and AMD.
Semiconductor export controls could also be expanded next month under the “AI diffusion rules” first proposed by the Biden administration, further restricting the sales of chipmakers that use TSMC foundries.
Taiwan currently faces a blanket 10% tariff from the Trump administration and that could rise to 32% after the President’s 90-day pause of his “reciprocal tariffs” ends unless it reaches a deal with the U.S.
As part of efforts to diversify its supply chains, TSMC has been investing billions in overseas facilities, though the lion’s share of its manufacturing remains in Taiwan.
In an apparent response to Trump’s trade policy, TSMC last month announced plans to invest an additional $100 billion in the U.S. on top of the $65 billion it has committed to three plants in the U.S.
On Monday, AMD said it would soon manufacture processor chips at one of the new Arizona-based TSMC facilities, marking the first time that its chips will be manufactured in the U.S.
The same day, Nvidia announced that it has already started production of its Blackwell chips at TSMC’s Arizona plants. It plans to produce up to half a trillion dollars of AI infrastructure in the U.S. over the next four years through partners, including TSMC.
Taiwan-listed shares of TSMC were down about 0.4%. Shares have lost about 20% so far this year.