NextDC says COVID-19 is upping Australian data centre needs

While organisations rethink storage requirements as working from home plans stay in place.

NextDC has witnessed an increase in compute power and storage space requirements from Australian customers, pointing to the COVID-19 outbreak as being part of the reason.

When NextDC built its S1 data centre in Sydney in 2013, it accounted for 16MW of customer load. It took just over five years to fill that capacity. Its second facility, S2, which has been open for merely a year, has seen 20MW of its total 30MW capacity already taken up.

Speaking with media on Wednesday, NextDC head of channels Steve Martin said that over the last few months, with the increased uptake of remote working to comply with social distancing requirements, businesses have been rethinking their operating models.

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"In the last three to four months, with the current pandemic challenges, a lot of businesses are questioning whether they need an office going forward or whether they need an office the size that they have today, going forward," Martin said.

"We've seen quite a few businesses in the last few months with customers that have chosen to get their data centre out of their office so that they can move offices because it's very, very hard to move an office when you've got a data centre; very complex piece of infrastructure and you need to pick it up, lots of connectivity, lots of risk in moving technology."

See also: Working from home 101: Every remote worker's guide to the essential tools for telecommuting

He said rather than moving kit to another office, only to then be required to move it again, his company is seeing a growing trend where businesses are looking to move it out of their office completely and into facilities like those operated by NextDC.

Martin said enterprises are also rapidly shutting down their on-premise data centres and moving their IT into facilities, like NextDC's data centres, to be close to the cloud.

"The efficiency of running your IT and cloud IT being as close as possible works far more efficiently with much lower latency to deliver outcomes for customers," he said.

Further drivers for an uptick in space requirements, Martin explained, include new cloud players entering the market.

"The cloud providers themselves, not only the common ones that we all know … but there's a next-generation of cloud providers that is coming and they're taking large amounts of very high-density space," he said.

Meanwhile, analyst firm Gartner has predicted that in Australia, government IT spending will decline 7.6% to almost AU$7.7 billion this year, in the wake of the pandemic.

The biggest falls will be experienced across data centre technologies, as well as devices such as PCs, tablets, and smartphones.

Data centre spending in 2019, Gartner said, was AU$282 million and in 2020, it's predicting this to decrease to AU$231 million.

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