(Photo above) Laurence Si, Managing Director, Microsoft Malaysia; Source- Microsoft
Microsoft has unveiled new details about its upcoming cloud region in Johor Bahru, Malaysia, designated Southeast Asia 3. This strategic investment aims to accelerate AI transformation across Southeast Asia, meet the surging demand for trusted cloud services, and fuel long-term economic growth, while strengthening Malaysia’s position as a regional leader in the digital economy.
Once operational, this next-generation cloud region will offer Microsoft’s most advanced and comprehensive suite of cloud services, purpose-built to support complex workloads and the evolving needs of customers across the region.
YB Gobind Singh Deo, Malaysia’s Minister of Digital, said, “This milestone underscores Malaysia’s continued progress in the digital economy. We are pleased to collaborate with the industry and Microsoft as a trusted technology partner in building Malaysia’s leadership as a secure and reliable location for digital assets of organizations across the region.”
Judson Althoff, CEO of Microsoft’s Commercial Organization, said at the AI Tour in Kuala Lumpur, “Southeast Asia is one of the most dynamic regions in the world. Our expanded investment reflects Microsoft’s commitment to helping governments, businesses, and communities innovate responsibly, build with confidence, and accelerate their AI Transformation journey, empowering organizations to emerge as Frontier firms.”
The Southeast Asia 3 region will add to Microsoft Azure’s more than 70 global regions. Earlier this year, Microsoft announced the general availability of its new Malaysia West cloud region in Greater Kuala Lumpur, empowering organizations in Malaysia to accelerate their AI journey.
Community and sustainability
Microsoft aims to build and operate its datacenters responsibly, ensuring they create tangible benefits for local communities. In line with its global Datacenter Community Pledge, the initiatives in Johor Bahru include:
- Skills2Work Datacenter Foundations Program (the Program): Microsoft, in collaboration with The Asia Foundation and Universiti Teknologi Malaysia (Johor Bahru), developed the Program to enhance employability and introduce participants to career opportunities in the datacenter industry. Over 12 months, the program will equip 150 recent graduates with hands-on training, industry exposure, and job readiness support – building a pipeline of skilled talent to support Malaysia’s growing digital infrastructure.
- Social entrepreneurship: Through collaboration with UNDP Malaysia and BPEN Johor, Microsoft is training 200 trainers from 20 social enterprises, empowering approximately 10,000 community members with the skills, networks, and support needed to enhance their social and economic impact.
- Renewable energy: The upcoming Southeast Asia 3 cloud region will feature backup generators powered by renewable biofuel to reduce net carbon emissions whilst supporting Malaysia’s sustainability goals.
- Water-efficient cooling: The upcoming cloud region is designed to achieve zero-water evaporation for cooling by adopting chip-level cooling solution through a closed loop. This approach will continually circulate water between servers and chillers, eliminating the need for a continuous fresh water supply. As a result, ongoing water consumption will be significantly reduced, supporting ultra-low Water Usage Effectiveness (WUE).
- Clean water access: Microsoft is working with CLEAN International and Water Watch Penang, with support from Jabatan Pelajaran Negeri Johor to install rainwater harvesting systems in 42 Johor schools, benefiting over 20,000 people and conserving a total of 8.4 million liters of water annually. These systems provide sustainable water sources for sanitation, hygiene, and maintenance, while also offering training on conservation and system upkeep.
- Mangrove restoration: Microsoft is partnering with Belia Prihatin and WWF Malaysia, to lead a three-year ecological restoration project in Kampung Sungai Melayu and Perapat River in Johor, promoting sustainable fisheries, eco-tourism, and environmental education.
With Southeast Asia 3 establishing the groundwork for scalable AI adoption, Microsoft is helping more businesses evolve into AI-driven enterprises—empowering human creativity and enabling new forms of innovation and differentiation. These organizations are leveraging AI to expand their impact and unlock fresh sources of value.
While many companies are still at the early stages of this transformation, others have advanced to collaborative models where humans and AI systems work together toward shared objectives.
To support an inclusive digital future, Microsoft continues to invest in skills development through AI for Malaysia’s Future (AIForMYFuture)—a national initiative to equip 800,000 Malaysians with AI-related capabilities by the end of 2025. As of October 2025, more than 734,000 individuals have already gained AI skills across government, enterprises, startups, educational institutions, underserved communities, and the broader workforce.
Laurence Si, Managing Director, Microsoft Malaysia, said, “As a trusted technology partner to Malaysia for over 33 years, Microsoft is committed to empowering the nation’s workforce with the skills needed to thrive in the AI economy. Through AIForMYFuture, we are working with the government, industry, and communities to ensure every Malaysian is equipped with the skills to thrive in the AI economy.
“Additionally, the upcoming Southeast Asia 3 cloud region reinforces Microsoft’s continued commitment to deliver secure, resilient, and scalable cloud services that will accelerate innovation and strengthen Malaysia’s position as a regional digital leader,” he added.
