Flexible power solutions FOCUS NEWS APAC Issue 9, April/May 10
ASIA-PACIFIC SUPPLY TO FALL FURTHER BEHIND GROWING DEMAND
Research firm Frost & Sullivan has warned that data center demand in the Asia-Pacific region is significantly outpacing supply, with a growth rate that is set to surpass 16% in 2011. The warning echos its findings about the American data center market.
“Data center hosting services are a huge, growing business – one that has remained largely insulated from the recession,” said Frost & Sullivan’s Chengyu Wu.
“As much as two-fifths of a company’s total energy consumption is spent on powering data centers, making the cost of maintaining captive data centers highly prohibitive,” said Wu.
The Australian government is looking to consolidate its IT infrastructure in hopes of saving up to $1 billion over the next 15 years, The federal government
announced a new strategy for procurement of data center services under which it is planning to establish a panel of data center suppliers, through which it will buy services, changing its traditional direct approach to the market. The new strategy was outlined
in a report by the Australian Government Information Management Office; however the report has been kept secret with no clear explanation why and has its critics in the legislature.
A Gartner survey of the Australian market revealed that many CIO’s in the country’s commercial sector have seen their budgets increase from last
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“Real estate, of course, is the other significant cost. In fact, more than 80% of the major data centers in Asia-Pacific are running at close to 90% capacity, and space is at a premium.”
The Frost & Sullivan report on the region covers 14 countries in Asia-Pacific, including Japan. In 2009, the data center services market’s size in the region was about $8bn, growing at a rate of about 12.8% year on year.
Wu expects the market to grow by 14.7% in 2010 and by 16.4% in 2011, by which point its size will reach approximately $10.7m.
Japan accounted for the largest portion of the region’s total market revenues in 2009,
year and that both public and private sectors are looking at more strategic use of their IT resources. Commercial “CIOs see 2010
as an opportunity to reposition themselves and accelerate IT’s transition from a support function to strategic contributor focused on innovation and competitive advantage,” VP for Gartner’s Asia Pacific Executive Programs Linda Price said in a statement. “They have aspired to this shift for years, but economic, strategic and technological changes have only recently made it feasible.” In addition to Australia, New
Zealand stood out in Gartner’s analysis of the results of its recent Executive Programs 2010 CIO Agenda Survey. About 33 percent of CIO’s from the two countries reported that their budgets increased this year, compared to 2009, and 10 percent of them said they saw
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generating $5.7bn. Other major Asia-Pacific data center hubs include Australia, Singapore, Hong Kong and, to a lesser degree, China, India and Malaysia.
Across the region, most demand is driven by “government initiatives towards e-governance and e-readiness”.
The remaining 45% of the market is driven by internet media, telecoms and IT companies, whose sectors continue growing at high rates.
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their budgets shrink. The survey, conducted in
December of 2009, included 1,586 CIO’s from around the world, 67 of whom were from Australia and New Zealand. About 38 percent of all CIO’s surveyed reported budget increases, however 22 percent of CIO’s worldwide reported that their budgets had shrunk. That brings the average percentage of Australia and New Zealand CIO’s that saw their budgets increase higher than the worldwide average by two percent. Price said 2009 was the
most challenging year for IT in a decade. “As many (Australia and New Zealand) organisations operate on a July to June financial year and may not have known their budgets by December, we think this represents a conservative view, and 2010 may shape up to be much better than this,” she said.
“Last year, many CIOs faced
multiple budget cuts wiping away four years of budget increases. Some IT budgets have not returned to 2005 levels, let alone 2008 levels. However there are definite signs of recovery in the 2010 projections.”
Malaysian data center company CSF Group raised up to £28m in a listing on the junior stock exchange in London, London AIM (Alternative Investment Market) in late March. CSF designs, develops and
operates data centers in Malaysia for domestic Malaysian, South-East Asian and large international businesses. It also reportedly has acquired
minority interests in companies in both Vietnam and Thailand, in order to facilitate its planned expansion into these countries.
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