In this episode of B2B Cambodia's Industry Update, we speak with Sergey Zubkov, General Manager of Daun Penh Cloud (DP Cloud), about the growing cloud services industry in Cambodia.
Daun Penh Data Centre, or Daun Penh Cloud (DP Cloud), is a leading provider of cloud solutions based in Cambodia. Founded in 2023, the company provides a comprehensive suite of cloud services tailored to all business needs.
Overview of the Cloud Services Industry in Cambodia
According to available data, about 25 per cent of Cambodian enterprises have adopted cloud services, shared Zubkov. Cloud services are in demand among private individuals, startups, micro, small and medium enterprises (MSMEs), large enterprises, and even the government.
“The adoption rate is still not as high as neighbouring countries in the region, like Singapore, but there is room to grow,” Zubkov stressed.
Nowadays, you cannot run any business without touching [cloud services] – all [businesses] need web hosting, or a server to run the backend of a mobile app or website, or an HR or accounting system. This is actually what all businesses in Cambodia are demanding, it’s just a question of what [services] they use. Some of them use foreign providers, but we are promoting ourselves as the first Cambodian cloud service provider.
Zubkov added that most of DP Cloud’s clients are Cambodian companies largely due to the benefits a server located within the country provides, such as much faster internet connectivity and cheaper pricing than international providers. Customers also do not need to pay withholding tax and only need to pay VAT, which they can claim back later.
Cloud Service-Related Laws and Regulations in Cambodia
There are currently no specific regulations that apply directly to cloud service providers in Cambodia, but there are some regulations being prepared which will eventually apply.
“The Royal Government of Cambodia is preparing a data privacy law and a data residency law, both of which are being prepared to protect the interest of citizens and businesses” shared Zubkov. “Being a cloud service provider hosted in Cambodia, we are ready for those upcoming laws, as our service equipment and customer data are physically here, residing on site in Cambodia.”
Cambodia’s Cloud Services Industry vs. Regional and Global Competitors
The cloud services industry in Cambodia is still quite young and underdeveloped, with other countries in the region like Thailand already having a larger presence of data centres and companies that provide similar services.
“But the market in Cambodia is mostly conquered by large players like Microsoft, Amazon, and Google, and they don't have any physical presence in Cambodia, but their main hub is rather in Singapore,” said Zubkov.
He also touched on the subject of artificial intelligence (AI), a technology which requires high-efficiency data centre facilities with large computational power, and how Cambodia is unable to compete in this area.
“Cambodia, so far, cannot compete and offer anything related to AI by sale because it requires specially designed data centres and it's a huge investment, so for AI, customers can still rely on the big players,” he explained.
While local cloud service providers like DP Cloud can meet the demands of local businesses in Cambodia, in order for the country to be able to attract more international investment into the AI and cloud technology space and seriously compete with its regional peers and challenge the dominance of large global players, Zubkov underlined the importance of maintaining attractive investment conditions for foreigners and joining private and public sector support.
“To attract companies to come to Cambodia and establish an AI project or something, what is needed is support from government institutions to make attractive conditions for foreign companies to come, as well as the involvement, support and partnership of local tycoons and local groups, because such [ventures] are usually done by an international company partnering with a local company,” he said.
“Just recently, for example, in South Korea, they announced a large project to start building a large AI data centre and AI park, with an investment of USD 10 billion over 5 years. Such projects cannot be done without the involvement and support of the government,” Zubkov stressed.
There is a good momentum in building up cloud services in Cambodia and promoting it. Almost no one is buying their own servers or equipment to place in their office, everyone has moved to the cloud already.
“If you are a Cambodian enterprise, why do you need to buy from outside? Data connectivity will be slower and your data will go outside to Singapore [for example] and back, but we are here [with services you will] notice are much faster being hosted in Cambodia. There is high potential and steadily [the industry] will grow year by year,” Zubkov concluded.