Data center firm activates second S'pore facility

Downturn likely spurred demand for datacenter services as more companies turn to cloud computing to cut costs, says Equinix, which opened its second data center in Singapore.

SINGAPORE--Emboldened by the cloud computing trend and strong growth in the first half of recession-mired 2009, U.S.-based datacenter operator Equinix formally opened its new data center in Singapore on Wednesday.

Officials said the data hub was established to address the acute shortage of data centers catering to companies that have recently increased their offerings on the Web, or businesses that do not want to operate their own data centers.

It is the company's second data center in the island-state and its 43rd in the world. In the Asia-Pacific region, Singapore has the distinction of hosting two such facilities with Tokyo, Sydney and Hong Kong each having just a single center.

Equinix spent US$45 million building the initial phase of the new facility, called SG2. Once the second phase is completed in October 2010, the company would have poured US$80 million in total investments.

The center, spanning 110,000 square feet of floor space, can accommodate 1,700 cabinets where clients can store their own equipment. Its capacity is just half the current size of SG1, the company's first data center in Singapore, but executives said its capability is on a "higher level".

Located in the western side of the island, the data center was built in a record seven months, the company said.

Steve Smith, president and CEO of Equinix, said in an interview the older SG1 has become the country's most network-dense data center and has, in fact, run out of space in spite of the financial crisis.

Smith said the downturn likely even helped spur demand for data center services as more companies turned to cloud computing to cut costs. That, he said, was crucial since most companies that provide cloud offerings such as Salesforce.com and IBM, are its clients.

"Even with the crisis, we grew 26 percent during the first half of the year. We haven't seen anything like this, and so we're expanding," he noted.

The company's customer base, according to Smith, comes from four areas: networks, digital media companies, enterprises and financial services. "The majority of them, however, are supporting Web operations," he said.

The Asia-Pacific region accounts for 13 percent of Equinix's business, while Europe makes up 26 percent and the United States accounts for 61 percent.

Unlike facilities maintained by telcos, Equinix said its data centers are "neutral" in every way. "Companies, including carriers, can even interconnect with different customers located in the facility," Smith said.

Clement Goh, managing director for Equinix Singapore, said SG1 has not been able to keep up with market demand even with the completion of its Phase 4 expansion in the second quarter of this year.

"SG2 will address demand for data center services here in Singapore," said Goh, speaking at the launch of the new facility. He added that Equinix's global IT development center was also unveiled here in April 2009.

In addition to providing co-location space, the new site is also expected to enhance Equinix's peering business, as the SG2 center will be located near one of the key submarine cable landing stations in Singapore.

Leo Yip, chairman of Singapore's Economic Development Board, officiated the opening and said in his address that the investment would help support the growth of online content and offerings in the city-state.

Melvin G. Calimag is a freelance IT writer based in the Philippines. He was in Singapore covering the Equinix data center launch.

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