Google’s proposed data center (red icon) location in the Tseung Kwan O Industrial Estate in Kowloon, next to a golf course.

News that Google was building new data centers in Hong Kong have circulated since the beginning of the year. Google has, however, now decided to cancel the project in Hong Kong. The company blames real estate acquisition issues as the reason for the decision. It isn’t immediately apparent if Google’s contentious relationship with the Chinese Government is to blame or if Honk Kong’s operation costs were at issue. It was reported in September 2011 that Google had already acquired  2.7 hectares of land n the Tseung Kwan O Industrial Estate in Kowloon which was expected to employ 25 full-time Googlers by this year…

Google gave The Next Web the following statement:

While we see tremendous opportunity and potential in Hong Kong – we’re actively hiring, just opened a larger office and recently launched a partnership with the Chinese University of Hong Kong to invest in tomorrow’s innovators – we will not be moving ahead with this project.

To keep up with the rapid growth in users and usage across the region, we need to focus on locations where we can build for economies of scale. Unfortunately, there is a lack of land for expansion in Hong Kong. We will continue to work closely with the government on this process, and will continue to invest and grow in Hong Kong.

The new Hong Kong data center was part of a plan to increase throughput speed by about 30% for neighboring regions, by adding data centers in Hong Kong, Taiwan and Singapore. Work in Singapore began in 2011 and is now finished. Although the Hong Kong site has been scrapped, progress in Taiwan seems unaffected with the project Whilst the Hong Kong site has been scrapped, progress in Taiwan seems unaffected (work on which began in 2011) as the project nears completion.

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