Where does Australia stand in the APAC data centre market?

 

Where is Australia in the Asia Pacific data center market?

Australia currently has 1,145 MW of operational, 265 MW under construction and 1,443 MW of planned data centers. In a recent report, Cushman and Wakefield revealed that Australia continues to lead data center development and capacity. More than 80% of operating capacity in Asia Pacific is concentrated in five markets, which are Australia, India, Japan, Mainland China and Singapore.

According to Alex Moffat, director and head of Cushman & Wakefield's data center advisory team, Australia - Industry, in the APAC region, 9.7 GW is currently in operation with a further 3.3 GW under construction and 8.5 GW in the planning stage . For Australia, there are currently 1145 MW in operation, 265 MW under construction and 1443 MW planned.

“Sydney continues to be the largest data center market in Australia with 63% of the country's total operating capacity. Sydney is one of the top 5 data center cities in APAC, along with Beijing, Mumbai, Shanghai and Tokyo, which are categorized as powerhouse markets, with each city predicted to exceed 2GW of capacity in the next 7 to 10 years. Cumulatively, these 5 cities represent 54% of the operational capacity in the entire Asia Pacific,” added Moffat.

Here's more from Cushman and Wakefield:

Operating capacity in Sydney has increased by 57MW over the past 6 months. Despite this additional capacity coming online, Sydney's vacancy rate fell from 17% to 12% over the same period. The combination of strategic geographical location and submarine cable connectivity will ensure that Sydney maintains its status as a major market in the region.

Eight cities in APAC have already reached 500 MW or are on track to surpass this level by 2024, including Sydney, which operates on the same scale as Beijing, Hong Kong, Mumbai, Seoul, Shanghai, Singapore and Tokyo. While Shanghai and Beijing have already surpassed 1 GW in operational capacity, Sydney, Singapore and Tokyo are expected to exceed 1 GW in operational capacity by 2026. Melbourne is also projected to exceed 500MW of operating capacity in the next 5 years. Melbourne forms part of the established data center market in APAC along with Chennai, Hong Kong, Hyderabad, Jakarta, Johor, Seoul and Singapore.

The next wave of data center development will see an increase in the number of 100MW buildings per site in both Sydney and Melbourne. Finding suitable land in both Sydney and Melbourne for future data center development continues to be challenging given the lack of appropriately zoned land in both markets.

We expect many markets in APAC to witness accelerated growth due to technological improvements such as adoption of AI, cloud services and deployment of 5G services. Ongoing government and corporate digitization initiatives will also lead to requirements for additional capacity.

The Asia Pacific (APAC) region has emerged as a global hub for data centers, driven by rapid digital transformation and growing demand for data storage and processing. Among the key players in this evolving landscape, Australia stands out as a major contender. In this article, we dive into where Australia stands in the Asia Pacific data center market and explore its strengths, challenges and future prospects.

Australia's booming data center industry

Strategic location: One of Australia's key advantages in the APAC data center market is its strategic location. Located between Asia and the Western world, it serves as a vital gateway for data traffic. This geographic advantage makes it an ideal choice for companies looking to establish themselves in the region.

Robust infrastructure: Australia boasts a robust and reliable telecommunications infrastructure. The country's well-developed network connectivity and high-quality data center equipment have attracted many multinational companies looking for secure and efficient data management solutions.

Government support: The Australian government is actively supporting the growth of the data center industry. Initiatives such as tax incentives and regulatory frameworks have made Australia an attractive destination for data center investment.

Focus on sustainability: Sustainability is a growing concern in the data center sector and Australia is no exception. Many data center operators in the country are adopting green technologies and renewable energy sources to reduce their impact on the environment, which is in line with global sustainability goals.

Challenges facing Australia

Competition from regional players: While Australia has a strong position in the Asia Pacific data center market, it faces competition from emerging data center hubs in the region such as Singapore, Hong Kong and Japan. These countries offer their unique advantages, including proximity to key markets and robust infrastructure.

Energy costs: Energy costs in Australia are a concern for data center operators. Addressing this issue is critical to keeping Australia's data centers competitive. Land Availability: Availability of suitable land for data center development is becoming a challenge, especially in metropolitan areas where demand is high. This could potentially limit the growth of the industry.

The future of the Australian data center market

Continued growth: Despite the challenges, the Australian data center market is expected to continue to grow. Growing demand for cloud services, edge computing and data analytics will drive the expansion of data center facilities.

Investments and partnerships: To remain competitive, Australian data center operators are likely to look to invest and partner with international players. This collaboration will help improve infrastructure and expand capacity. Sustainability initiatives: Sustainability will remain a focus, with more data centers adopting green practices and renewable energy sources. This commitment to sustainability will attract environmentally conscious clients.

Australia occupies a prominent position in the Asia Pacific data center market, thanks to its strategic location, robust infrastructure, government support and sustainability efforts. While there are challenges such as competition and energy costs, the future looks promising as the industry continues to evolve and adapt to the changing digital landscape. Australia's data center market is poised for growth, making it an attractive destination for businesses looking for data management solutions in the APAC region.

As the Asia Pacific (APAC) region continues to experience unprecedented growth in the data center industry, Australia is at the forefront of this digital revolution. With its robust infrastructure, strategic location and commitment to sustainability, Australia has carved out a significant niche in the Asia Pacific data center market. In this article, we delve into Australia's current position in the APAC data center landscape and explore the key factors contributing to its prominence.

Australia's strategic location

One of Australia's main advantages in the Asia Pacific data center market is its strategic geographic location. Australia is located close to the emerging markets of Southeast Asia and serves as a gateway to the region. This proximity has made it an attractive destination for businesses looking to set up data center facilities to cater to the APAC market.

Robust infrastructure

Australia boasts a robust and reliable infrastructure that is critical to the data center industry. The country's well-developed telecommunications network, advanced power grids and high-speed internet connectivity ensure that data centers can operate efficiently and without interruption. This infrastructure is particularly attractive to international corporations seeking to establish themselves in the APAC region.

Sustainability initiatives

Sustainability has become a top priority for businesses around the world and Australia is no exception. The country is actively working on sustainable data center solutions, incorporating renewable energy sources and implementing environmentally friendly practices. These efforts are not only in line with global sustainability goals, but also make Australia an attractive choice for companies looking to reduce their carbon footprint.