Indian companies operating data centres are ramping up capacity, as enterprises make a shift to the Cloud and as the government pushes initiatives such as digitalisation and data localization.
The data centre market, currently pegged at around $4 billion, is likely to grow to $7 billion by 2020 or 2022, say industry players.
The demand has been spurred by a huge thrust towards digitization across industries, particularly financial services, manufacturing, e-commerce, and IT and IT enabled services.
"We're currently operating at a capacity of 65Mw and will increase this to 90Mw this year, and to over 200Mw over the next three years," said Sumit Mukhija, CEO, STTelemedia GDC India, which runs 14 data centres and has three greenfield facilities in the pipeline. The business had been growing at a Compounded Annual Growth Rate of 25% in the last few years, outpacing industry growth of almost 10%, he said.
Netmagic, another key player in the segment, says it has similar plans.
"NTT Com-Netmagic will soon buy land to set up new campuses in Mumbai, Chennai and Bengaluru. The Mumbai and Bangalore facilities have expanded NTT Com's data centre capacity (server room) in India by 70%,"" said Nitin Mishra, chief product officer. "We have also opened a third data centre in Bangalore to build next-generation multi-cloud platforms."
Organizations in India are investing more in server rooms as well as mid-tier data centres compared to their regional counterparts, said Rishu Sharma, Research Manager, Cloud & AI, IDC India. "Local players are planning to open up new data centres not only in large cities, but are also exploring setting up data centres in Tier II cities," she said.
Manufacturing companies have begun preferring third-party data centres when older equipment has outlasted their useful life. They then migrate to managed service providers, Mishra said.
ESDS, which currently operates data centres in Nashik, Mumbai and Bengaluru, is expanding to Delhi and Kolkata, along with the MENA region.
"The challenge is more on addressability of the India market. There are potential 1.2 million customers who could move to cloud. Reaching out to all these potential customers is the biggest challenge," said Piyush Somani, CEO, ESDS Software Solution.
Finding the right piece of land, with factors such as uninterrupted power and water supply, is critical to the functioning of the data centres. Skilled manpower is another challenge.
"Organizations are struggling with challenges like integrating new technologies in existing data centres, along with inefficiencies related to energy and space. Enterprises are dealing with tasks associated with innovating their IT and also maintaining their existing IT infrastructure," said IDC's Sharma.
Digital data in India is estimated to increase to about 2.3 million petabytes by 2020, according to industry reports. If this does happen, the country could emerge as the second largest investor in the data centre market and the fifth largest market by 2050.
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