LATAM Remains a Prevalent Data Centre Hub for AI Innovation

The Latin American (LATAM) data centre market is currently on an upward trajectory. 

Its market growth has been overwhelming and can be attributed to a range of factors, including global digital transformation, increasing cloud adoption and a regional surge of technologies like AI that require large volumes of data to power.

Historically, LATAM has been an underserved market within the data centre industry. However, demand continues to grow, with more big technology companies eager to strategically invest in countries across the region, including Brazil, Argentina, Chile and Columbia.

Developing facilities for the AI era

In 2023, Brazil was leading data centre investments in LATAM and accounted for around 40% of the region’s total investment.

São Paulo is currently one of the leading locations, particularly as it benefits from access to 10 of the main submarine cable routes connecting South America. As a result, the Brazilian market has significantly increased, with international operators like Equinix, Microsoft and OData leading in the area. 

One such recent investment in the area is leading telco Nokia and networking company Furukawa Electric LatAm, who have expanded their partnership to bring high-performance solutions in data centre automation to Brazil. 

Having collaborated since 2022, both companies are continuing to offer advanced passive optical network technologies to the LATAM business market. Furukawa will offer Nokia’s Data Centre Fabric solution, which includes high-performance data centre switching platforms and an open resilient Network Operating System managed by Nokia Event-Driven Automation (EDA).

The modern platform is designed to combine speed with reliability and simplicity, in addition to providing guardrails that detect errors caused by automation.

“Together with Furukawa Electric LatAm, we are committed to bringing cutting-edge data center technology to the Latin American business market quickly,” says Juan Pablo Anadon, Head of Enterprise, Webscale and Partners Sales for Latin America, Network Infrastructure at Nokia. 

“Our new EDA platform, developed for the AI era, simplifies data centre management and can cut down operational efforts up to 40%.”

As the data centre market in LATAM transitions, AI and big data continue to play a mainstream role in public consciousness. Already, data centres in the area are being pushed by the high demand for data, with LATAM able to offer advantages such as renewable energy and a business-friendly environment to encourage growth.

Attracting the attention of big tech

Despite challenges, the outlook for the data centre industry in LATAM is a positive one. By strategically focusing on high-growth markets, whilst prioritising sustainable innovation, industry leaders and their partners can expect to capitalise on this market and further contribute to the digital transformation of the region.

It is these positives that continue to attract larger technology corporations to the region, including Google who in August 2024 announced it was starting construction on a new data centre in Uruguay.

Its second data centre in LATAM, the tech giant is investing US$850m in the new data centre to bring greater connectivity across the region. Google states it also hopes to boost the development of local businesses and communities, whilst simultaneously improving access to growing demand for AI.

The new facility will also use renewable energy in more than 90% of its energy matrix.

“We hope our new data centre in Canelones will be a significant contribution to the professional and technological development of Uruguay and the entire region,” says Eduardo López, President of Google Cloud for Latin America.

“As we break ground, we will continue investing resources in Data Center Community Impact Programs that harness the full potential of technology, including digital skills training and new projects that generate economic and social impact.”

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