Data Centers Flock to Tokyo as Beijing’s Appeal Fades

Tokyo has benefited from the rapid deterioration of the business environment in China, becoming a preferred choice for global information technology companies considering relocating from Beijing. As tech companies flock to Japan, the Tokyo metropolitan area—a longtime high-tech hub—has become home to the largest cluster of data centers in the Asia Pacific region. Projections indicate that the total data facility capacity in the Tokyo region will likely double within the next three to five years, positioning it as the second-largest data center hub in Asia, challenging Beijing, which currently ranks first. The shift is largely attributed to mounting security concerns, risks that outweigh the lower costs of doing business in China, and a less-than-friendly business environment within China. For American companies, a major factor is the escalating friction between the United States and China. Meanwhile, Japanese data companies are finding that the benefits of doing business at home outweigh the increasing risks of doing business in China....