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Australian data centre operators up cloud game amid demand surge

Covid-19, government initiatives, and strict privacy laws are forcing a significant market shift in Down Under.

By João Marques Lima

Founder and Editor, The Tech Capital

4 Mins

July 20, 2021 | 1:36 PM BST

With the Australian data centre market currently on a growth trajectory of 4.5% CAGR to 2026, national operators are ramping up their portfolios.

Over in Sydney, Macquarie Data Centres, part of Macquarie Telecom Group (ASX: MAQ), said it will build a new data centre at its Macquarie Park Data Centre Campus in the north part of the city.

Intellicentre 3 Super West will be designed, constructed and operated to meet the needs of corporate, government and multi-national customers and enhance New South Wales’ cybersecurity infrastructure and capabilities.

Macquarie added that it has commenced a State Significant Development Application process today to build the 32 MW IT load facility, which will be the largest data centre on the campus, bringing the total IT load of the campus to 50MW.

The company expects the project to create more than 1,200 jobs in construction, engineering, cybersecurity, and other fields.

It has also anticipated completing construction of Phase 1 of IC3 Super West in the second half of the calendar year 2023, subject to final Board approvals, with planning permission expected to be granted in early 2022.

Macquarie Telecom Group CEO David Tudehope, said: “This data centre will attract new investment into Australia from multinationals looking to expand in the Asia Pacific region.

“The NSW digital economy is rapidly growing, and this project will create world-class infrastructure and valuable long-term jobs in the digital and cybersecurity sector.”

Macquarie added that its data centre services have been in high demand, with circa 10MW IT load contracted with “a leading global corporation” at the Macquarie Park Campus in November 2020, with the fit-out works in relation to that contract tracking well for completion in late 2021, early 2022.

Elsewhere, NEXTDC (ASX: NXT) has announced that their M2 Melbourne data centre has been enhanced to provide government and enterprises access directly to Google Cloud from anywhere in Australia via two new Google Cloud Interconnect access points.

NEXTDC CEO Craig Scroggie said: “The addition of these two new Google Cloud Interconnect services offers enterprise and government organisations greater depth and diversity when optimising their Hybrid and Multi-Cloud strategies.

“In addition to providing an increased level of security and reliability, these new Google Interconnect locations will vastly expand Australia’s access to one of the world’s fastest-growing cloud platforms.”

According to Mordor Intelligence LLP, The growing cloud computing market`(further fuelled due to COVID-19), increasing cloud computing among SMEs, government regulations for local data security, and growing investment by domestic players are some of the major factors driving the demand for data centres in Australia.

“Currently, about 10-15% of data is created and processed outside a centralised data centre or cloud, but the number is expected to cross 60-70% by 2025, a global trend that is also reflecting in Australia,” researchers say.

“The recent COVID-19 crisis has further highlighted that Australia has a great need for digital infrastructure to improve connectivity for remote and rural areas. Hence, edge data centres are becoming more viable options for Australian vendors, especially start-ups.​”

In addition to Macquarie and NEXTDC, Telstra, Equinix, AAPT, and Vocus Communications are also major players in Down Under.

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João Marques Lima

Founder and Editor, The Tech Capital

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