Australia is one of the most advanced data center services market in the Asia Pacific region in terms of market size, according to a new research.
Frost & Sullivan also estimates that 40% or 200,000 square meters of approximately 500,000 square meters of data center space in Australia is outsourced.
In 2012, the average revenue was around A$3,000 ($2935) per square meter. Over the past decade, this market opportunity has attracted many leading global data center service providers to establish a local presence in Australia. Significant data center buildouts are occurring across Australia in response to the strong growth in data usage, the demand for local data centers and the increasing propensity of Australian organisations to outsource data center operations.
The reportfinds that the market will reach revenues of over A$1.5 billion ($1.4 billion) by 2019. The growth rate of data center outsourcing and the need for greater data center space will continue to stimulate demand, providing significant growth opportunities for most service providers.
“Key factors driving demand for outsourced data center services include the tightening of IT budgets, the need to establish business redundancies and refresh current facilities and the enhancements in enabling infrastructure through initiatives such as the National Broadband Network (NBN),” said Mayank Kapoor, industry manager, data center services and cloud computing, Frost & Sullivan Asia Pacific. “Challenging factors for data center service providers include increasing operating costs, competition, data sovereignty concerns and the need to retain talent.”
Kapoor explains that high-end co-location and interconnect providers will see healthy growth, as demand increases for secure, latency-sensitive applications. The government is the largest vertical for data center services accounting for over one-quarter of the market, with the Banking, Financial Services & Insurance (BFSI) sector and the Telecommunications/IT sector the other key demand verticals.
The amount of computing power housed in data centers will grow at a very strong rate as a result of multiple factors such as the increasingly ubiquitous usage of rich media (voice and video), growing broadband speeds and the rapid adoption of cloud computing.