Malaysian firm Puncak Semangat Technology Sdn Bhd is investing RM150 million (US$42M) to expand its data center and cloud computing facilities near Senai Airport in the state of Johor. This is set to be the largest such facility in southern Malaysia when completed, and is located within the Iskandar Malaysia economic zone.

According to a report carried on Singapore broadsheet The Straits Times, construction of the second phase of the Synergycloud Data Centre on 5.3 hectares of land at Senai Airport City will begin soon and is expected to be fully operational by 2017.

Puncak Semangat is closely linked to the Malaysian government, and is one of the key players involved in servicing the IT needs of the government ministries.

Malaysia has its sights set on businesses in Singapore to set up competitively priced data centers across the border from the city-state. The linchpin of its efforts is a number of upcoming data centers that it has been encouraging within the new high-tech clusters at Iskandar where, last month, Telekom Malaysia announced plans to build a $38 million data center in the Nusajaya Tech Park.

As well as the possibility of offering a cheaper location for back up data centers, the new facilities could also serve local financial institutions and businesses being established in the Iskandar region. For international business, concerns over data sovereignty must first be resolved, as well as the higher cost of connectivity within Malaysia.

The latter is an area that is being actively addressed, though. In our report last month, “Malaysia sets its sights on being a data center hub”, Chiew Kok Hin, group chief executive officer of AIMS for the report expressed optimism about turning the tables on data centers in Singapore and Hong Kong by attracting customers to set up their primary data centers in Malaysia.