At the recent Digital Infrastructure Investment Summit, sponsored by Nedbank, the point was raised that with Africa currently having the fastest growing population of any continent, it offers enormous potential for digital product usage and growth in digital services.
Studies have indicated that some African cities are likely to be the largest cities in the world providing ample opportunities for growth investments in digital infrastructure. However, investments are often at risk due the regional legislative environments as well as other restrictions such as sufficient stable power supply and import duties on equipment.
Teraco, is a carrier-neutral colocation provider, that builds highly resilient, vendor-neutral data environments in sub-Saharan Africa. They have developed world-class data centre infrastructure and network-dense ecosystems and forms a vital role in the African internet’s backbone and in modern enterprise’s digital transformation.
The company is focussed on creating space and cooling for ITC customers and in network neutral setting, and currently have availability of 95 Mega Watts of power supply online with an additional 92 under construction.
Sam Erwin – CFO: TERACO, when asked about what the current growth curve of demand in Sub Saharan Africa is for data centre racks, and what are the main drivers of this growth are responded as follows:
What are the Main Drivers?
According to Erwin, masses of enterprises are moving towards cloud computing and are preferring a vendor neutral data centre structure. Being part of a larger data centre set-up is logically beneficial in that they can get the benefits of economies of scale as opposed to building their own individual solution. An added benefit is that they get access to new upgrades and services without having to outlay any of their own capital, freeing up investment in their core business activities.
Being in a data vendor neutral environment also allows enterprises the freedom of changing suppliers with eases and without additional costs. This together with substantial growth in Ai development is driving growth and demand in the data centre industry.
What has changed in the industry locally?
The main change occurring has been in building block size requirement, that has grown from a 1-2kw of power in 400m2 space to an average of 800m2 with requirements for 10kw racks and currently there is more and more demand for 1400m2 size blocks with 45kw racks. This is driving expansion and the planning of more data centres.
The Advantage in SA, according to Erwin is the national energy network, however regulations regarding access to power at local municipal level, still needs to be ironed out.
Digital Realty their international partner and investor are investing across Africa with Terraco’s focus on the South African Market only at this stage.
Will we see new entrants in the Data Centre Market?
He believes the local market is well defined and does not see new players entering the market at this stage. He believes it is likely that SA will remain the IT hub for Sub-Saharan Africa at this point, but future large-scale developments requires bigger building blocks with better power supply for the existing market players to continue to scale.
Terraco is looking to expand and will be looking for additional rounds of funding to expand their networks of data centres.
