Sponsored by APAC Supplement INSIDE Data center technology meets the markets of the Asia Pacific region Australia at the Edge > The world’s largest island is the perfect Edge market Singapore opens up > After a three year moratorium we visit a high-rise facility Cooling with snow > Hokkaido, Japan, makes good use of a seasonal nuisance
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Towering ambition in Singapore With no spare land to build on, operators in Singapore have gone upwards. Equinix's SG5 is Singapore's tallest facility at nine storiesThat(p4).record only stands till Facebook's 11 story tower opens nextButdoor.SG5 is well worth a visit, not just because of its height, but because of its role in supporting colocation, in a data center hub which is redefining itself. SG5 was planned before 2019, when the government responded to data centers' rising power demands with a ban on new projects. That moratorium is opening up now - but future would-be builders will find a lot of competition for a very limited number of data center permits (p6). Australia's Edge There is no market in the world like Australia. A tiny population, making up a relatively wealthy economy, distributed across untold acres of openEdgespace.computing players have realized that these factors make Australia the perfect market for the pitch, which is to distribute tech resources close to users. Most Australian towns can't muster resources for large data centers, but they are spread too far to support low-latency applications without some local, Edge resources. The downside of this is that multiple Edge players are moving in to compete for the market. A price war on capacity could drive a race to the bottom, leaving Australia's Edge patchy, till we get consolidation (p13).
The Asia Pacific region is not like other data centerThere'smarkets.plenty of growth there, as APAC catches up to the longer-established regions of Europe and North America. Each APAC nation is finding it has a growing population of middle-class digital consumers, that need online services.Butbeyond that, the similarities end, and every APAC market is different.Indiahas a creaking power system, but an established digital class.Singapore is home to APAC headquarters for vast numbers of multinationals, but hasn't got room for data Australiacenters.has plenty of room, and a rich economy, but few people. Japan has an industrial economy with a lack of renewable energy. Across the region, we've found stories which show an ingenious set of solutions to the problems in each individual APAC nation. Cooled by Japanese snow For centuries, Japan has been working creatively with snow, producing such masterpieces as Nobel Laureate Yasunari Kawabata's novel Snow Country. So, while US wisdom says that when you have snow, you should shovel or make snow angels, it's no surprise to see Japan come up with another option. The White Data Center turns snow from a waste product to a source of cooling. At the same time, the facility is using its waste heat to feed Japan's love of eels (p10).
4. Inside Singapore’s tallest multi-tenant data center Equinix’s newest data center spans nine stories, plus underground fuel storage
10. Data centers cooled by snow Snow makes for sporting fun and urban nuisance... and cooling
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6. Dissecting Singapore's pilot for green data centers Intense competition for a small number of permits
The APAC difference
13. Australia is the perfect market for an Edge industry Its geography suits Edge, but is there room for multiple players?
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Contents
Another significant fact about SG5 is it was approved before a moratorium on new data centers in 2019. Though the moratorium was lifted this year , new data centers will now be subject to a raft of guidelines around PUE and innovation around energy use. Though the rules are still being ironed out, it is safe to say that future data centers will be quite different.
Much of this can probably be traced to Equinix’s SG1 data center at Ayer Rajah Crescent, which houses its Asia-Pacific Network Operation Center (NOC) and is often anonymized with the tag of “carrier hotel” on the presentation decks of local telecommunication providers and competitors alike. Though SG1 is old in data center terms, it is supported by fiber optic connectivity that goes under a driveway to the larger, purpose-built SG3 right Equinix’s newest data center spans nine stories, not counting underground storage tanks for fuel Paul Mah Editor
Constructed with an initial investment of $144 million, and opened in August 2022, the nine-story SG5 is the tallest data center in Singapore - at least until Facebook’s mammoth 11-story facility goes live, virtually next door.
E quinix is no stranger to the data center hub of Singapore, where it has been operating since 2002. In the intervening two decades, it has steadily grown its portfolio of data centers in the island state to five facilities, with the newest launched just last year.
Even when the Facebook tower opens, SG5 will still be the tallest multi-tenant facility in the data center-dense nation, where data centers consume a staggering seven percent of the available electrical power. Why SG5 matters SG5 is noteworthy for more than its height. It’s Equinix’s fifth data center in Singapore, but only its second greenfield facility here. Its first greenfield, SG3, launched in 2015 , and there are clear differences between the two. It would be interesting to see how Equinix would design a data center for a tropical, land-scarce location if it started on a new project today.
An exploration of SG5 won’t be complete without an overview of the other Equinix data centers in the country. Equinix claims that it hosts the most network-dense data centers in Singapore, housing many of the international and regional networks connecting South Asia.
Inside Singapore’sSG5, centermulti-tenanttallestdata
Sophisticated design SG5 was clearly designed to maximize every inch of its compound: Backup generators and high-efficiency watercooled chillers are installed on the roof, which comes with upper and lower levels. The diesel fuel for powering the backup generators is stored underground, while backup power is supplied from lithiumion UPS – which have a smaller footprint than traditional lead-acid batteries.
Inside Equinix SG5 DCD was invited to visit SG5 last year, as Covid restrictions eased in Singapore and shortly after its official launch . Located in the Tanjong Kling data center park at Sunview Drive, the new facility is right across the street from Facebook’s upcoming data center and adjacent to Telecom Indonesia’s Telin 3, which we toured in 2016. SG5’s location in a data center park allowed designers to incorporate features to enhance reliability and security, such as its three fiber paths for diverse connectivity. And like all new data centers in Singapore, the building is compliant with the Threat and Vulnerability Risk Assessment (TVRA) guidelines from the Monetary Authority of Singapore (MAS).
In addition, Equinix has eschewed a raised floor design altogether, which together with a slab-to-slab height of 6.5m presumably allowed for more floors within the building’s height restriction without compromising its ability to support tall racks. Equinix says its Equinix Cooling Array supports high-density customers whilst reducing water and power consumption needs. But though there is no question that this is optimal for hyperscalers which tend to roll out more standardized systems, the downside is the need for more careful planning and allocation of space for smaller colocation customers.
In that vein, Leong sees Equinix’s mission as an “everyday retail data center” to power the digital ecosystems and essential“[Givenservices.themoratorium], we are very strategic in terms of the customers we want. We want to ensure that these are customers that will help continue to enable the digital economy, [that they are not here] just for colocation, but [are here to] interconnect to our clouds, interconnect to our business partners, interconnect to the network and the different enterprises,” she said.
next door. Crucially, all Equinix data centers are part of an islandspanning metropolitan area network, built using a ring topology for protection against a single point of failure.
Things get interesting inside the data halls: each of the two data halls on each level is cooled with a fan wall, which Equinix calls the Equinix Cooling Array. These take up the entire length of each data hall and are positioned as part of a hot-aisle and cold-aisle deployment.
The compound is fronted by a standalone security building at the entrance for security personnel to verify the identities of visitors. There is a small private car park in front of the building, which you cross to enter the building.
According to Equinix, the first phase saw SG5 offering an initial capacity of 1,300 cabinets, which was recently expanded to 2,950 cabinets . When fully built, SG5 will hold 5,000 cabinets. Data halls are located between the ground level and the roof at level nine, giving it seven floors worth of data halls.
The facility is powered by dual redundant 66kV power feeds, supplied from dedicated substations built to serve the data center park. It is understood that level 2 through to level 4 offers 21MW of power in total, while the next four levels are designed to support up to 3MW per floor.
Indeed, Equinix has had its eyes on sustainability for a while now and had previously revealed that it has operated with 100 percent renewable energy in Singapore since 2020. Leong was eager to highlight the value that data centers bring to today’s digital economy in general, though she also emphasized that not all data centers are the same, drawing a distinction between hyperscale facilities operated by a single provider and retail colocation providers.
The moratorium has since been officially lifted, but the restrictions mean that Leong’s words are probably just as true now.
Automation Supplement | 5APAC Supplement | 5 Inside SG5
The shape of things to come Unlike SG4 which was converted from a warehouse, the foundation of SG5 was designed from the very beginning to be a data center, which means its space, height, and various technical specifications are optimized, says Yee May Leong, the managing director of South Asia at Equinix, in an interview with DCD last year. When asked about the Equinix Cooling Array, Leong noted that it was an example of a creation that came out of Equinix’s sustainability research. She added: “We are constantly looking at our design and construction to review how we can build it faster, more efficiently, [and with higher] energy savings.”
Jabez Tan, the head of research at Structure Research, told DCD pointed out that the evaluation criteria appear to favor retail operators such as Equinix, Global Switch, and Digital Realty, given their interconnected assets from a carrier and cloud on-ramp perspective, as well as a global footprint. “It would likely be tougher for operators
The pilot data center - call for application exercise (DC-CFA) outlined the criteria by which proposals for new data centers will be evaluated against.
Paul Mah Editor
A summary of the key criteria can be found here (pdf), but the three key evaluation requirements asked of hopeful data centers operators can be summed up broadly as sustainability, a strategic value to strengthen Singapore as a regional or international connectivity hub, and the potential to advance the nation’s economic objectives.Manyof the requirements in the sustainability category are hardly new and include certification such as the Singapore-developed Green Mark for Data Center (Platinum) – increasingly found in new builds, a PUE of 1.3, and the ability to demonstrate “best-in-class IT energy efficiency.”However, it was the strategic and economic evaluation requirements that got some quarters of the industry to sit up and question if hyperscalers and smaller operators are left out in the cold.
Call for application unveiled
Dissecting Singapore’s pilot for green data centers Who will take the coveted prize of a new data center permit?
T he moratorium on new data centers in Singapore has finally been lifted after three years, and the country has made clear that it will now be “more selective” of data center projects in future. But how exactly will new data centers be selected?
The launch of a pilot scheme for new data centers by the country's Infocomm Media Development Authority (IMDA) and Economic Development Board (EDB) at the end of July finally put that question to rest.
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Creating the incentive to go green
Whether that contribution comes from cutting edge technologies, improved operational strategies, or new business partnerships, is what every investor and operator is trying to [figure out],” said Street.
The DC-CFA pilot application closes on 21 November 2022
But will we end up sacrificing opportunities in terms of digital capabilities and innovation? Probably not, when one considers that Singapore already hosts all the top public cloud players, which operate out of multiple data centers. Moreover, capacity requirements for the Singapore cloud regions will likely ease as new public cloud regions are established in the region. No matter how you dice it, there will be far fewer data centers built in Singapore, relative to the many new builds continuing apace in other Southeast Asia countries. Is there a risk of Singapore losing its current position as a data center hub? The current consensus appears to be a “no”.
Jason Plamondon, a senior manager of sustainability at Equinix Asia-Pacific concurred: “While hydrogen does represent a potential future source of green energy for data centers, it remains some distance away from being commercially viable.”
Tan from Structure Research summed it up this way: “I don't think it's a binary outcome. Singapore will always be a data center hub. [But] moving forward, there will likely be other data center hubs across Southeast Asia that will eventually decentralize the need to solely rely on Singapore as the only data center hub in ASEAN.”
Plamondon pointed out that Equinix is currently piloting hydrogen-ready fuel cells in Italy, however. The price to the prize When viewed from this perspective, it is evident that the intention is to create an irresistible incentive to entice the data center industry to explore more radical technologies and bring them to fruition. Centers that specifically cater to large hyperscale deployments to differentiate given the emphasis on connectivity,” observed Tan. He also pointed to the capacity allocation of up to 60MW per application as “somewhat perplexing” This could result in only one data center being be built in this pilot, due to the higher efficiencies achieved by larger facilities.Aswe reported previously, the initial plan outlined at the start of the year was for data centers of between 10MW and 30MW capacities, to be allocated from a total pool of 60MW. However, Tan also noted that the Singapore government has now expressed a willingness to increase the initially proposed 60MW depending on the attractiveness of submitted applications.
It is worth noting that this pilot scheme came in the wake of various governmentinitiated or government-funded efforts over the years to find a path to sustainability in hot and sunny Singapore, a small island nation that is bereft of most renewable energy sources. Just counting the publicly-announced projects, there was a trial of a tropical data center, an attempt to explore the potential of high-rise data centers, and even funding to research technologies such as water coolingThere is no question that the DCCFA represents a radical shift in strategy towards a private-led approach to building more sustainable data centers. What does the government hope to gain from this? The answer can probably be found in the decarbonization clause under the
And the prize is a coveted slot to build a new data center in Singapore. It won’t be a free ride, however, and industry stakeholders can expect to piece together the resources or partnerships to get in the running.“[Projects that want to] stand out will have to show this commitment and then push beyond the standard rhetoric and demonstrate that they will make a positive impact in Singapore’s digital ecosystem.
sustainability requirement, which called for proposals for renewable energy use, or plans for “innovative energy pathways” to offset carbon emissions footprint. Interestingly, hydrogen is named as a specific example of an innovative energy pathway. Multiple studies and consortia have been initiated in Singapore to explore this, including initiatives by STT and Linde, KBR, Keppel, and a Keppel and Osaka Gas jointButprojectiIsthe data center industry ready for hydrogen though? When quizzed on this, Chris Street, the head of data centers at JLL is unequivocal that hydrogen is not currently available on a production basis for mission-critical workloads such as a dataHecenter.said:“That is simply a fact of the current market situation. With that said, there are a significant number of investors, agencies, and industry participants that are looking into the situation and trying to pull this forward given Singapore’s position in the hydrogen supply chain.”
H ere in Singapore, a large scale industrial facility in a western part of the city-state plays a critical role in Southeast Asia’s rapidly expanding data center sector. Within its four walls, diesel generators are carefully assembled to individual customer specifications. These highly advanced pieces of equipment, often with outputs of up to 4MWs, provide the mission-critical power for multimillion-dollar hyperscale and colocation data centers in many countries across the region.
Recent investment at the plant reflects the growing importance of having a ‘close-tomarket’ production strategy serving the data center sector in Southeast Asia. This approach allows for a more bespoke service – with 90
CLOSE TO HOME 8 DCD Supplement • datacenterdynamics.com
Delivering end-user advantage So, let’s take a more in-depth look at the benefits of local design and manufacture for data center applications. Firstly, customization is vital because it allows generators to be designed for the specific requirements of local cities and countries. This could relate to stringent emissions regulations or on-site restrictions around noise. Kohler’s technical teams have extensive knowledge of regulatory variations across Southeast Asia and can optimize designs to help customers meet any requirements.TheSingapore factory also provides a regional base for rigorous testing and approvals, often attended in person by data center customers. By working together with local engineering consultants or end-users at the plant, test results for first-of-type data center generators can result in modification of the design, with Kohler working swiftly to perform refinements to systems and components, as required.Anunderstanding of local conditions on the ground is also crucial for logistics. Southeast Keith Khoo Head of Marketing PowerKOHLERSystems,How a local production strategy for the supply of generators better serves the requirements of data center operatiors across Southeast Asia percent of generators built in the plant having some form of customization. It also drives better business relationships and shorter lead times, resulting in on-the-ground cost and logistics efficiencies.
The customersbyattendedapprovals,rigorousafactorySingaporealsoprovidesregionalbasefortestingandofteninpersondatacenter
The Jurong Pier Road plant is the headquarters of Kohler Power Systems in SEA. It is here that large power node generators are designed, built and tested before being shipped locally to tier 1 data centers hubs in Singapore and other hotspots such as Singapore, South Korea, Indonesia and ANZ.
Data center operators have exacting standards and demand the highest levels of design, manufacturing, testing, delivery, installation and after-sales. That is true now and will remain so in the future. A close-to-market strategy for missioncritical equipment such as generators delivers advantages in multiple areas. As a result, Kohler is committed to investing in its Singapore facility, ensuring customers get the best products and service every time.
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Committed to local customers
KOHLER | Advertorial Asia, as a region, comprises an impressive diversity in religion, culture and history. Its terrain and infrastructure also vary from one country to another – and transporting large pieces of equipment such as generators to different data center locations can present a logistical challenge. Therefore, local insight and knowledge are critical considerations to ensuring that equipment gets to the site without delay. For example, large-scale 4MW generators often need to be lifted carefully into place, requiring mobile cranage on-site. A detailed assessment of floor loadings needs to be arranged before delivery and installation can occur. These arrangements are better made in close collaboration with a local plant. The Singapore facility also acts as a foundation for consistent after-sales and technical support, with 24/7 service support including instant access to genuine parts that help deliver optimal performance. Distributors, dealers and teams of service engineers benefit from having close business relationships with Kohler’s in-house design and production experts, ensuring up-to-date knowledge and training.Above all - a regional plant allows for a truly global footprint, giving customers an advantage in production redundancy. Uncertainty created by the ongoing pandemic and production costs makes a regional location all the more important. With Kohler’s Singapore plant, we can offer alternatives in the event of a disruption in other countries - ensuring customers get the backup power they need when they need it.
The system cools data center servers using half the energy required by techniques,conventionaland uses a waste product with no impactenvironmental In the city of Bibai, on Japan’s North Island of Hokkaido, an artificial hill of snow is slowly creaking and settling, gradually melting in the island’s mild summer climate. The hill has been covered with a layer of grayish insulation, as if to preserve it. But the hill’s owners don’t want to keep a pile of snow forever. They just want to use the cold it produces as it melts. An ice-cold pipe extends from the mound to a nearby building. The pipe carries anti-freeze. But more importantly, it carries the hopes of a small band of data center experts, who believe that one future for data center cooling could rely on snow. No skiing on these slopes Hokkaido is a center for winter sports. It’s the northernmost part of Japan, and the coldest. Even its summer days only reach 17 to 22°C (62.6 to There’s71.6°F).noshortage of snow in Bibai, the
Peter Judge Global Editor
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Data cooledcentersbysnow
It’s said that snow gives you two options: shovel or make snow angels. Now you have a third choice: cool your data center fifth largest city on the island. Around 10m falls every year. And while tourists may enjoy skiing and snowboarding, it’s a headache for the city to keep the streets clear. Each year, the city spends 400 million yen ($3.5m) shoveling the frozen precipitation up. Because heaps of snow might not melt all year, the city gathers it in dump trucks and removes it to dedicated snow melting sites. Basically, snow is a costly nuisance. Or it was, until Professor Kobiyama Masa yoshi of the Muroran Institute of Technology,
WDC expects to ship in around 300,000 eels, which will be grown on-site for seven months, till they reach a commercial weight of 250g began experimenting with pipes of antifreeze.Under Professor Masayoshi, the Bibai Natural Energy Research Association looked into ways to make use of snow, and found that its coldness or “snow cooling energy,” could actually be useful.
Obviously, in winter, no snow-cooling is needed as the ambient temperature is low enough to cool the servers unaided. And the snow mound - covered with insulating material to preserve it - lasts all year. More will be gathered next winter before this year’s heap has melted away.
Construction on the “zero-emission” data center was announced in April 2019, with the facility due to come onstream in in 2021, and be hooked up to renewable power facilities owned by Kyocera in 2022. The plan was for 2MW each of wind and solar power to be available to the site, which would also draw energy from a nearby thirdparty biomass plant. The project is due to go live in the Ishikari Bay New Port industrial park, which has a “100 percent renewable energy area” commitment that requires all companies who build in the area to power their facilities with renewable energy. We haven’t found any more recent updates on the project, and we suspect the pandemic may have put it off target, but we’ve reached out to Kyocera to find out about progress, and hope to report more details … and Data Dock We’ve also had reports that a third company brought the snow cooling idea to the more temperate main island of Japan, Honshu.
Cooled by snow
Other plans from Kyocera… As we said, Hokkaido has plenty of snow, and the White Data Center was not the only project on the island to use snow to cool data centers.InIshikari, 50 km away from Bibai, Kyocera Communication Systems has announced plans for a zero carbon data center solely powered by wind, solar and biomass.
The group proposed cooling data centers with melting snow. One source of inspiration seems to have been Lawson, a Japanese convenience store chain, which in 2012 introduced a selfcontained snow-based cooling system for a store in northern Japan. Rather than using piles of snow, the store was equipped with a 100 cubic meter insulated container that was filled with cold snow. Water running through pipes in the container was cooled by the snow and used in the air-conditioning system. Professor Masayoshi developed that idea and, by 2014, a prototype known as the White Data Center was up and running, backed by funding from Japan’s NEDO (New Energy and Industrial Technology Development Organization).Thesystem cools data center servers using half the energy required by conventional techniques, and uses a waste product with no environmental impact. The White Data Center’s snow mountain has no associated CO2 emissions. Even the trucks that gather the snow would have to do it whether or not the data center existed. It’s a comparatively low-tech solution, with low costs to implement. The antifreeze circulates between the snow mound and the data center, where a secondary water circuit cools the servers. There is no need to clean up the snow, which is gathered in a pile that also contains trash and mud from the streets. The team simply runs a pipe through the heap, circulating the antifreeze, which goes back through the heap after its journey through the data center.
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In the Niigata Prefecture, data company Data Dock reportedly ran a sustainable data center using renewable power, cooled with snow meltwater, in the city of Nagaoka, just 174 miles north of Tokyo. The area has an average temperature of 12°C (53.6°F) from February to December, so there will be less snow around, but the site is reported to have made use of it, along with coolSadlyair. the Data Dock website seems to be down and its Facebook page has not been
Time to go commercial
According to a government press release issued earlier this year, WDC plans to operate a zero CO2 emission data center, using renewable power from biomass generation plants.“The next data center we plan to build will be ten times the size of the current one, with 200 racks of servers running,” says WDC president & CEO Ijichi Shinichi in a statement. Warmth for fish There’s a side benefit to the facility too. The president spoke about how the Center may develop.“Inorder to use energy efficiently, we’re experimenting with vegetable cultivation and fish and seafood farming in greenhouses using waste heat produced by the servers during winter,” said Shinichi. “We plan to turn this into a reality as the data center grows in scale.”
the commercial White Data Center began operations with approximately 20 racks of servers, on a 3.6-hectare plot of land bought by one of the project's partners, Kyodo News “Currently,Digital.a20-rack
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Of the three Japanese snow-cooling projects we know of, it seems it was the White Data Center which was successful enough to get commercialized.Afterrunning for five years, from 2014 to 2019, the WDC proved its viability, and in 2021, the White Data Center company was established.InApril2021,
data center is in operation as an experimental facility,” a White Data Center spokesman told us by email. It offers commercial services, we were told, with four unnamed companies using it or planning to use it: “Fees are lower than those of general data centers,” said our source at WDC.Andthe company has ambitious growth plans: “We plan to begin construction of a new building with a capacity of 200 racks by the end of this year [2022].” While the experimental facility operated at 2kVA load per rack, the new facility will have a higher power density of 5kVA per rack.
updated since 2019, so we suspect this chilly data center may have melted away.
WDC has filed patents for snow cooling systems and heat utilization circulation systems, we were told, but they might have limited applications, because there simply aren’t many places which have enough winter snow, the right amount of summer sun, and a combination of local data demand and renewable power.
During its research phase, WDC explored various agricultural options for this heat, including abalone, sea urchin, Japanese mustard spinach, cherry tomatoes, and other products.Asitenters a commercial phase, it has chosen eels and mushrooms as the first products, according to a report in Asahi Shimbun. Both can be harvested after a short period of cultivation. Eels are a major food staple in Japan, where a massive eel-farming industry has ramped up to some 250,000 tons per year in the last 40 years. WDC has imported 1,700 elvers (young eels) which will grow to maturity in tanks at the data center. The water cycle of the data center cooling system produces water at 33°C, which is ideal for eel farming, as the tanks can be kept at 27°C all year round with no heating costs. WDC expects to ship in around 300,000 eels, which will be grown on-site for seven months, till they reach a commercial weight of 250g.Atthat point, they will be sold nationwide and included in local school meals. They will be the first eels cultivated in Hokkaido, Asahi Shimbun reports. Can we all join the snow party? WDC’s success is pretty cool. Operators elsewhere might be wondering if they can imitate it, but WDC is not encouraging on this“Itscore.isdifficult to imitate a place with snowfall alone in terms of revenue and expenditures,” said the WDC spokesperson we “Thiscontacted.isbecause there are surprisingly few places with the right conditions, such as land price, amount of snow and collection methods, and stable collection of fuel needed for biomass power generation.”
But the world’s largest island has just two notable data center markets in Sydney andBecauseMelbourne.ofits sprawling geography but relatively small population, Australia may actually be better suited for a nascent Edge data center industry than Europe or North America. The demand for local compute in smaller cities and towns is there, but many areas lack any sort of nearby data center facilities of any sort, and most will never justify build-outs at large scale.
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Australia’s geography might make it a perfect market for a proper Edge industry, but is there room for multiple players?
The Australian Edge: the perfect market for an Edge industry
Dan Swinhoe Editor
The Australian Edge
Despite spanning an area almost the size of the US or Europe, Australia has a population of just 25 million, close to that of Madagascar or the Ivory Coast.
News
The US boasts major data center hubs on both coasts as well as growing markets in the south and north, while Europe has at least five established markets (the FLAP-D of Frankfurt, London, Amsterdam, Paris, and Dublin) alongside nascent locations across the continent.
Edge Centres has secured contracts with the likes of local IT & ISP players, while Leading Edge says its initial customers include regional businesses such as manufacturing & distribution as well as government and telcos. “What we're seeing initially, which is what we anticipated, is telcos, ISPs, retail service providers,” says LEDC CEO Chris Thorpe. “We've really built these facilities with government in mind: if it's good enough for government, it's good enough for everybody else.”“Last year for us was extremely challenging with Covid. This year, completely different; we're seeing a very different sort of open-minded approach to the edge, which is now very much becoming accepted.”
Battle for the Australian Edge
The state of the Edge now As DCD has previously reported, many within the data center industry believe we are still in the early days of the Edge. While future use cases are being developed, the likes of mobile network operators (MNOs), hyperscalers, and local managed service providers/SaaS players are likely to be the early customers.
“We've got quite a substantial MSP very close to launching on a multi-site deal. We've got a tier-one telco on board as well.”
Other players including DXN and DC Two develop small modular facilities for enterprises as well as operate a small number of colocation facilities. As well as operating three permanent data centers, DXN has delivered at least 20 modular data centers to customers including Boeing and Covalent Lithium as well as a prefabricated Cable Landing Station to the Belau Submarine Cable Company (BSCC) for its new cable spur to Palau.
A number of firms have sprung up in Australia, looking to fill the gap for Edge locations outside the traditional metros. Founded in 2018, Leading Edge Data Centres (LEDC) uses prefabricated data centers that can be quickly erected. The prefabs come in either 30 or 75 rack configurations. The company has data centers in Tamworth, Newcastle, Albury, and Dubbo; it has plans for 10 more in New South Wales (NSW) before moving into Victoria and then to Queensland and the Gold Coast.
The company has partnered with Schneider Electric and Cisco, and its backers include Australian investment firm Soul Pattison and DigitalBridgeEdgeCentres (EC) builds smaller, providing modular ‘off grid’ data centers powered by on-site wind and/or solar power and connected to the main grid as backup. Each facility is equipped with just under 1MW of solar infrastructure, and 48-hour battery, and UPS backup equipment, which supports 64 1kW quarter racks. The company says the sites can produce more electricity than they use.As well as Traralgon and Bendigo in Victoria, EC has or is developing Edge locations across Grafton and Dubbo, NSW; Toowoomba, Cairns, Mackay, and Townsville, Queensland; and Hobart, Tasmania. In September 2021, the company broke ground on an Edge network operations center in Albury, New South Wales. By the end of 2023, it aims to have 20 sites operational, and 40 sites operational by the end of 2024. Some are built in containers outside, others are installed in purpose-built rooms inside existing buildings.
Thorpe says LEDC is close to launching its own private cloud that can be used for small medium and large enterprise in partnership with an as yet unnamed ‘significant cloud partner’.“This is where we really see the ecosystem evolving; initially with telco and then building out with ISPs, RSVs, and major cloud providers as well. And that's that in turn is going to start bringing enterprise in en masse.”Asthe 800-pound gorilla in the data center space, the fact that DigitalBridge is “This is effectively a land grab; we all want to position ourselves as an Edge player in a particular country or a particular location. There's also the long game that you've got to be able to manage that out"
“The carriers are still trying to work out how they're actually going to make money out of it.”
Will 5G be the major driver of Edge use cases? The ‘Metaverse’? Gaming? IoT? No one is sure, and none have yet taken off in a way that could sustain a new segment of the data center“There'sindustry.definitely a 5G arms race as far as trying to get some 5G connectivity out there. But as far as business applications, I think that will be a little bit slower,” says Thorpe.
“We don't have a true Edge customer because we don’t really know what defines an Edge customer yet,” adds EC’s Eaves. “We've got people using compute in the region, but that's not necessarily for Edge; it's just that they don't want to have to drive it to Sydney when something goes wrong.”
Even Edge Centres’ CEO Jon Eaves acknowledges DigitalBridge’s investment in Leading Edge has been good for the local industry: “It’s validated the Edge, I think. DigitalBridge blessing a particular technology legitimizes it.”
Eaves also says over-the-top providers (OTTs) like Facebook as well as major streaming services will likely be future customers.Thorpeadds that agri-tech may also be a large customer of the Edge in future, especially in the likes of Australia where farms can span thousands of hectares.
“I have my money on the hyperscale really being the Edge customer,” says Eaves. “Because really all the Edge is doing is filtering heavy workloads that are then transferred back to the cloud anyway.”
Though their offerings are all different – pre-fabbed containers for DXN, solar powered pods for EC, and Tier III designs for LE – is there enough differential between the market players to create a leader? “I don't think anything separates us at the moment. There's three companies all going after the same market,” warns Eaves. “What Leading Edge offer, what Edge Centres offer, what DXN offer are all the same, which is detrimental because then it becomes the race to the bottom which is obviously price.“This is effectively a land grab; we all want to position ourselves as an Edge player in a particular country or a particular location. There's also the long game that you've got to be able to manage that out. There's a lot of companies talking about going to the Edge and I look forward to there being more partners and more competitors in the space.”
Edge Centres is developing facilities in Kuala Lumpur, Malaysia, another in Vietnam’s Ho Chi Minh City. It is planning further sites in Johor, Ipoh, and Penang in Malaysia, as well as at locations in Indonesia, the Philippines, Japan, and three locations in Vietnam.There is, however, some competition for the Edge in APAC: DXN has delivered containers to Palau and the Cocos (Keeling) Islands for cable landing stations, while Turbidite – an APAC-focused Edge player led by former Global Cloud Xchange CEO Bill Barney – has a presence in Guam and Hong Kong.
Edge later; what will it look like? It was 2018 when Michael Dell said “the Edge will be bigger than the cloud.” Whether that will be true in the long run is still unclear. So too is the route to get us there.
“With the emerging markets of Asia Pacific set for solid growth in the next wave of digital transformation, and a huge gap in highly connected, safe data centers, we believe this is a perfect time to build our footprint in the capital cities of the key emerging Asian markets, then expanding to the second tier developed markets,” Barney said last year.
“The regional areas of Asia are as underserved as the regional areas of Australia,” says Eaves. “But there is no competitor; there is no DXN or Leading Edge in Asia, they are very much focused on the hyperscale towns.”
“It's a huge market. There's a lot of need for IoT out there. The whole ag-tech sector, I think absolutely will be red hot. But not just“Iyet.”think the Edge is in its infancy,” concludes Eaves. “We're all still pre-Edge. What the Edge is right now is not what it's going to be; I still don't think any of us know what it will look like in 2026.”
The Australian Edge APAC Supplement | 15 interested and investing in the Edge is seen as a boon. Executives in Europe have told DCD that the company’s investment in the AtlasEdge venture alongside Liberty Global has helped raise the profile of the Edge with investors and customers, and the same effect has happened in Australia.
Thorpe says LEDC is currently focused on Australia, though it has had ‘some discussions’ about projects overseas.
“It's made a big difference. It's definitely been a milestone moment for us,” says Thorpe. “Even from an institutional investor perspective, we've got a stack of inquiries coming through now. But also from a client perspective, it adds a layer of credibility as to 'well this is really happening'.”
If more players enter the space, we’re likely to see some consolidation and failures: Earlier this year Edge Centres acquired fellow local Edge player DC Matrix, adding two facilities currently in development in Sippy Downs, Queensland, and on the Gold Coast, to its portfolio. In the US, early Edge data center startup EdgeMicro entered liquidation late last year. The APAC Edge Beyond Australia, Edge Centres is heavily focused on expanding in Asia, which the company predicts could be more of an opportunity in the long run.
Is Australia big enough for more than one Edge player? As previously mentioned, Australia is huge geographically, but has relatively little existing data center build-out compared to Europe or the US. But the need and early demand for the Edge is already there and could help spur further development. “People in regional Australia, which is a third of the population of Australia, have had a serious challenge accessing cloud-based services, which is why the penetration is still quite low,” says Thorpe. “You've got these vast distances with no credible data center facilities. There's no credible, resilient place to have serious IT infrastructure, and that's exactly where the opportunity is; I think if anywhere in the world is suited for an Edge network, it's Australia.”“Sovereignty is becoming a massive issue over here. Where is your data; is it held in Australia or in the States? You need to know as a company director exactly where your information is held.” Despite the vast geography, the population of Australia is small, especially outside the existing hubs. Is there enough room and demand to allow multiple Edge players operate within the country? Both Eaves and Thorpe say probably not. “Australia's a tiny market,” says EC’s Eaves. “We've only got 25 million people, the towns we're building in have never even had a data center.”“You look at the size of our cities, region by region, you're probably talking 2-300,000 people,” adds Thorpe. It’s not a huge capture in each location, so that first mover advantage is really critical.”
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