Massive-scale cloud providers are driving demand in the Sydney and Melbourne data center markets, and the Australian market is seeing strong demand because local requirements are best served in-country and enterprises in the market are more outsource-friendly than in other Asia-Pacific markets.
These are the main findings from Structure Research's recently released Australian data center research report.
The report reviews the Sydney and Melbourne colocation markets, tracking market size and growth trajectory and provides a five-year CAGR projection, along with a detailed analysis of the underlying supply and demand trends.
Structure Research’s proprietary methodology measures colocation supply from both a space and power perspective with the firm splitting the market between retail and wholesale colocation.
For both markets, the findings show that the retail-wholesale composition is quite similar: both regions have larger retail colocation markets but the directional trend is towards wholesale and the markets should be about evenly split by 2021.
Moreover, the report finds that growth trajectories and utilization rates of Sydney and Melbourne are also headed in a similar direction.
In 2016, Structure Research predicted that the Sydney colocation market would be worth US $360m, growing at 12% y/y in 2017.
On the other hand, in Melbourne, the research firm expected the market to be worth US $119m with a projected growth rate of 9% y/y.
Overall, the report finds that demand in the Melbourne and Sydney data center markets is driven by the massive-scale cloud providers.
In addition, other contributing factors to the nation’s growing colocation market is its unique geographic location and mature economy.
Microsoft and Amazon both have an established presence with Microsoft expanding rapidly. Google and Alibaba have also established data center footprints in Australia and are expected to grow at an accelerated pace for the next twelve months, the report states.
The Sydney colocation data center market by the numbers:
The Melbourne colocation data center market by the numbers:
The report outlines the top international providers as Equinix, Global Switch, Fujitsu, Keppel DC REIT, Digital Realty Trust and DCI Data Centers.
It also names the top local Singapore providers as Telstra, Metronode, NEXTDC, Macquarie Telecom, AirTrunk and Vocus Communications.