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Issue 13, Dec 10/Jan 11


data center announcements. A

NBN Co is the company set up by the Australian Government to design, build and operate its National Broadband Network (NBN). In November it signed a A$9.5m deal with Cisco for data center equipment. Cisco said it will lead a coalition of companies, which includes EMC and VMware, for the fit out which will be built upon Vblock technology, designed by the Virtual Computing Environment coalition, which all three are members of.

Cisco said this will ensure scalability within the data center, with the project expected to bring about high levels of demand resulting in increased data that will grow over time. Cisco’s Unified Computing System will bring together the virtualization and network resources, which in turn will lead to energy efficiencies, Cisco said.

NBN Co’s three-year deal with Cisco includes computing, network,

storage access and

virtualization which will be brought into a unified system, to be used for NBN Co operating and business systems. NBN Co also recently signed with Global Switch to house hardware and software.

Despite government bickering over the plan, this latest announcement shows that NBN Co is well on its way to setting up its data center operations in Melbourne, the capital of the state of Victoria. The state classes the announcement as a massive win. The Australian Information Industry Association said it believes the data center and placement of other operations there will make Victoria “the connected state”, strengthening its digital economy and boosting ICT jobs there.


NBN Co, tasked by the government to organize infrastructure for the project for wholesale and retail service providers, has a difficult job on its hands, however. The NBN plan has become one of the most talked about in Australian

50 ustralia kicked off its

commitment to its controversial National Broadband Network in November with a number of large

NBN: AUSTRALIA’S FIGHT FOR CONNECTIVITY Australia is making headway with its A$43bn National Broadband Network, but despite committing to the data center and winning over cloud-computing companies, vocal criticism still puts plans in doubt. By Penny Jones

media in recent times, and has drawn its fair share of criticism.

The NBN has been designed to increase digital services for Australia. The Australian government has pledged to connect 93% of all Australian premises, including those in the outback with fiber-based services, and 7% with next-generation wireless, going in direct competition with current copper infrastructure in Australia. Many have argued that Australia’s economy needs better broadband to keep up with the rest of the world. World Economic Forum reports from 2009 – 2010 rate the nation as 27th in the world for the access of digital content available, 21st for the availability of new technology and 16th on the Network Readiness Index. Infrastructure plans for the NBN are expected to fill in these gaps.

But according to Springboard Research VP of research John Brand, timing is key. He says especially when it comes to the data center and application services space, growth in Australia is likely to occur, regardless of whether the NBN takes place due to Australia’s economic and political stability and its closeness to the rest of Asia. Lower latency and better service delivery is likely to have little effect on growth in this space.

Australia is moving ahead with its plans at a cost of A$43bn. Criticism surrounding the NBN is largely targeted at the fact that Australia has a low-density population. It is also feared that it could decrease competition in the broadband and connectivity market in Australia, having an effect on other broadband players there.

Australia has slower connections than Japan, South Korea and Singapore and it is also the fifth most expensive out of the 30 OECD countries for broadband services.

Despite this, Brand says he believes the real need for such expensive infrastructure has not properly been considered. “The issue for NBN is how much bandwidth is really required to an end-point . . . and more importantly what is an end point? Is it a single building, single connection within a building or user on a

connection in a building or a user on the move with a mobile device? That’s where the debate must really be focussed,” Brand says.

“Just as we’ve seen in the x86 server market, we need to avoid building in underutilized capacity for no real significant benefit. In the x86 server world we’ve been happy running servers at under 20% utilization for the last 20 years. Now we’ve realized that this has implications, not only to infrastructure and energy costs but also the environment.

Virtualization took off as a result of trying to optimize this excess capacity. We would hope that the same logic applies to the NBN before it is fully built out. The NBN is a great idea, but possibly about 20 years too late,” Brand says.


Software as a service player Netsuite’s CEO Zach Nelson, however, says NBN could have a huge affect on on those companies playing in the cloud. NetSuite, Amazon,, Microsoft and Google have all avoided placing data centers in Australia, and instead host data in the US.

NetSuite claims to have more cloud-based enterprise clients than any of the above in Australia, with 600 customers on its list.

With the rollout of the NBN, he said that could all change. Faster connections in Australia could lure NetSuite’s data center services to Australian shores, he said at a Gartner conference in Sydney. If not Australia, than Singapore could win the deal. “The NBN will certainly change the experience of our customers in using NetSuite,” IT news site ARN quoted Nelson as saying in October. “The NBN tilts the scales towards Australia.” 

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