Companies are moving towards third-party Data Centres

Every day, thousands of companies generate digital landfills of data as they cater to new customers and generate sales through the internet. All this requires vast data centres to adroitly — and safely — manage and store digital information. India, an IT hotspot, is destined to bite off a large chunk of this rapidly growing business.

The data centre market in India is about $120 million — a meagre 1 per cent of the global market. However, India is “the fastest growing market in the APAC region, with growth rates in the next five years expected to be 22.30 per cent”, says Naresh Singh, principal analyst for enterprise network infrastructure & services at Gartner. According to Anu David, senior research analyst for the ICT practice of Frost & Sullivan, South Asia & Middle East, Indian data centres will soon become globally competitive.

Notably, companies are rapidly moving from managing their content through in-house or ‘captive’ data centres, to ‘third party’ ones run by Indian companies. Today, India has twice as many captive data centres as it does third-party ones. Estimates by Datamonitor, a London-based market research company, suggest that of the 7 million sq. ft of data centre space to be added in the next four years, more than 90 per cent will be for third-party data centres.

In the past, companies were concerned about outsourcing their data handling to others because of security, accountability and intellectual property rights issues. For instance, firms such as ICICI Bank and Indian Oil Corporation (IOCL) have traditionally banked on in-house data centres. ICICI Bank has its main data centre in Mumbai and a disaster recovery site in Hyderabad, while IOCL has data centres in Jaipur and Gurgaon. “The biggest advantage is that we are not dependent on uncertainties faced by a vendor,” says S.S. Soni, executive director for information systems at IOCL. “We are also able to maintain secrecy of information.”….Read More