Indonesia Data Center Colocation Market Growth Insights – Utilized White Floor Area to Reach 8.01 Million Sq. Ft., Utilized Racks to Reach 198 Thousand Units, and IT Power Capacity to Reach 1,668 MW by 2031.

Indonesia Data Center Colocation Market – Supply & Demand Analysis 2026-2031

INDONESIA DATA CENTER COLOCATION MARKET SIZE

Indonesia data center colocation market size was valued at USD 570 million in 2025 and is expected to reach USD 1.27 billion by 2031, growing at a CAGR of 14.36% during the forecast period. Indonesia colocation data center market is one of the top-rated colocation data center markets in the Southeast Asia region.

The market features a balanced mix of domestic and international colocation providers. Major operators include DCI Indonesia, BDx Data Centers, Telkom Indonesia, Princeton Digital Group, NTT DATA, Metta DC, Digital Edge (Indonet), Digital Realty Bersama, ST Telemedia Global Data Centres, and several other regional players.

Industrial electricity prices in Indonesia generally range between $0.08 and $0.11 per kWh, depending on customer category, contracted capacity, and location. Indonesia continues to offer relatively competitive electricity prices compared with regional data center hubs such as Singapore, while remaining slightly higher than countries, including Malaysia and Thailand, making it an attractive destination for large-scale data center investments.

Batam continues to emerge as one of Indonesia's leading data center destinations owing to its reliable power infrastructure and expanding digital ecosystem. The island benefits from a diversified power generation mix comprising coal-fired, natural gas-fired, and renewable energy sources, along with ongoing investments in transmission infrastructure and green energy projects. These advantages, combined with abundant land availability and competitive operating costs, position Batam as a preferred location for hyperscale and colocation data center developments over the forecast period.

Cloud and colocation providers are enhancing interconnection platforms to deliver low-latency connectivity for AI, cloud, and high-performance computing applications. For instance, in April 2026, Digital Realty announced that its ServiceFabric platform will be launched in Indonesia during H2 2026, enabling seamless interconnection between cloud providers, enterprises, and global digital ecosystems. The platform is designed to accelerate AI and HPC workloads by providing secure, low-latency connectivity through its CGK10 and CGK11 data centers.

INDONESIA DATA CENTER COLOCATION MARKET INSIGHTS BY UTILIZED AREA

The Indonesia data center colocation market by utilized area is expected to reach 8.01 million square feet by 2031. The high utilization rate reflects strong demand from hyperscale cloud providers and AI workloads, prompting operators to continue expanding their existing campuses and developing new facilities across the country.

Greater Jakarta continues to dominate Indonesia's data center development, driven by the availability of digital infrastructure, enterprise demand, and cloud connectivity, while Bekasi and Karawang are emerging as preferred hyperscale development locations due to lower land acquisition costs compared with Central Jakarta. Developers are increasingly selecting suburban industrial corridors such as Bekasi and Karawang, where land prices are significantly lower than Central Jakarta, enabling the construction of large campus-style facilities with room for future expansion.

INDONESIA DATA CENTER COLOCATION MARKET INSIGHTS BY UTILIZED RACKS

The Indonesia data center colocation market by utilized racks is expected to reach 198 thousand units by 2031. The rapid adoption of AI and generative AI workloads is expected to significantly increase rack power densities in Indonesia, with hyperscale operators increasingly deploying racks exceeding 50–100 kW. Consequently, developers are investing in liquid cooling technologies, higher-capacity UPS systems, and advanced power distribution infrastructure to support next-generation AI clusters.

INDONESIA DATA CENTER COLOCATION MARKET TRENDS & DRIVERS

Adoption of Liquid Cooling among Data Centers

The growing deployment of AI-ready infrastructure is accelerating the shift toward liquid cooling across Indonesia's data center market. As operators develop high-density facilities capable of supporting advanced GPU workloads, liquid cooling is expected to become a standard feature in future hyperscale and colocation data center developments.

In October 2025, BW Digital completed the structural framework of its NDP1 data center in Batam. The facility has been engineered with direct-to-chip liquid cooling capabilities from the initial deployment phase to support AI-focused infrastructure.

In March 2025, SM+ began construction of its SMX01 facility in Jakarta. The data center has been designed with on-demand advanced liquid-cooling infrastructure to efficiently support high-density enterprise and AI applications.

Geographic Expansion improving redundancy, reducing latency, and supporting regional enterprises

In May 2026, DCI Indonesia secured a $980.9-million credit facility to accelerate the construction of new data centers and meet increasing customer demand across the country. The company also inaugurated its 9-MW E2 Surabaya facility, expanding digital infrastructure beyond Jakarta to strengthen regional capacity, edge deployments, and AI-ready services.

In 2025, Digital Realty entered Indonesia through a joint venture with Bersama Digital Infrastructure Asia and acquired two operational facilities in Jakarta. The expansion marked the company's entry into one of Southeast Asia's fastest-growing colocation markets and strengthened international investment in Indonesia's digital infrastructure.

Operators are increasingly expanding beyond Jakarta into emerging locations such as Batam and Surabaya to improve geographic redundancy, reduce latency, and support regional enterprise and cloud workloads. These locations are attracting investments due to their strategic connectivity and growing demand for edge infrastructure.

INDUSTRY RESTRAINT

Power Availability & Outage Challenges

Reliable power availability remains one of the key challenges for data center development in Indonesia. Although major data center hubs such as Jakarta and Batam have relatively developed power infrastructure, power availability and grid reliability vary significantly across the country, particularly in secondary cities and outer islands. Developers often need to invest in dedicated substations, backup generators, and redundant power systems to meet uptime requirements.

Indonesia's rapidly growing cloud, AI, and colocation sectors are increasing electricity demand at a pace that puts pressure on the national power grid. Large-scale hyperscale and AI data center projects require hundreds of megawatts of power capacity, creating challenges in securing long-term power allocations and grid connections.

The Indonesian government and state-owned utility, PLN, are investing in grid expansion and power infrastructure upgrades to support hyperscale developments. For instance, PLN Batam signed power supply agreements of 90 MVA for NeutraDC's facility and 511 MVA for DayOne's hyperscale campus in Batam, demonstrating the growing need for dedicated power infrastructure to support large-scale data center developments.

Continued investments in transmission infrastructure, grid modernization, renewable energy integration, and dedicated power supply arrangements will be essential to ensure reliable electricity availability and support Indonesia's rapidly expanding data center market.

INDONESIA DATA CENTER COLOCATION MARKET SEGMENTATION INSIGHTS

INSIGHTS BY COLOCATION DEMAND

Based on the colocation demand by industry, in 2025, the cloud & IT sector accounted for the largest share of Indonesia's colocation demand, contributing around 30% to the total demand. Growth is driven by rapid cloud migration, hyperscale cloud expansion, SaaS adoption, AI workloads, and increasing enterprise digital transformation initiatives. Going forward, demand is expected to increasingly focus on AI-ready infrastructure rather than conventional cloud deployments. Hyperscale operators are expected to deploy high-density AI clusters, liquid cooling technologies, and GPU-based computing infrastructure, significantly increasing colocation requirements across Indonesia.

INSIGHTS BY COLOCATION REVENUE

Based on revenue, retail colocation generated over 68% of the market's total revenue in 2025, while the wholesale segment is projected to expand to nearly 47% by 2031. This shift is primarily driven by rising hyperscale deployments, increasing wholesale leasing activity, and continued cloud adoption. The expansion of hyperscale self-owned data centers, particularly those being developed by Microsoft, is also expected to influence Indonesia’s colocation market. As more cloud workloads are hosted in company-owned facilities rather than third-party colocation sites, the demand pattern for colocation services is expected to gradually shift.

WHAT'S INCLUDED?

1. A transparent research methodology and insights on the colocation demand and supply aspect of the market.
2. Market size available in terms of utilized white floor area, IT power capacity, and racks.
3. Market size available in terms of Core & Shell Vs Installed Vs Utilized IT Power Capacity along with the occupancy%.
4. The study of the existing Indonesia data center market landscape, and insightful predictions about data center market size during the forecast period.
5. An analysis of the current and future colocation demand in Indonesia by several industries.
6. The study on sustainability status in Indonesia.
7. Analysis of current and future cloud operations in Indonesia.
8. The snapshot of upcoming submarine cables in Indonesia.
9. Snapshot of existing and upcoming third-party data center facilities in Indonesia.
10. Facilities Covered (Existing): 90
11. Facilities Identified (Upcoming): 26
12. Coverage: 15+ Regions
13. Existing vs. Upcoming (White Floor Area)
14. Existing vs. Upcoming (IT Load Capacity)
15. Data center colocation market in Indonesia.
16. Colocation Market Revenue & Forecast (2025-2031)
17. Retail Colocation Revenue (2025-2031)
18. Wholesale Colocation Revenue (2025-2031)
19. Retail Colocation Pricing along with Addons
20. Wholesale Colocation Pricing along with the pricing trends.
21. An analysis of the latest trends, potential opportunities, growth restraints, and prospects for the colocation data center industry in Indonesia.
22. Competitive landscape including market share analysis by the colocation operators based on IT power capacity and revenue.
23. Vendor landscape of each existing and upcoming colocation operator based on existing/ upcoming count of data centers, white floor area, IT power capacity, and data center location.

RESEARCH METHODOLOGY

1. Primary Research: Interviews/interactions with data center developers, colocation providers, contractors, system integrators, and infrastructure providers.
2. Secondary Research: Analysis of annual reports, financial filings, press releases, data sheets, white papers, industry blogs, and tender documents.
3. Historical Period: 2022–2024
4. Base Year: 2025
5. Forecast Period: 2026–2031
6. Approach: Market data is validated using primary industry inputs and secondary sources, with 2025 representing actual values and 2026–2031 representing forecast estimates.