Microsoft rumoured to invest $2bn in Hyderabad campus
The cloud and data centre arm of Microsoft might be about to build India’s biggest data centre campus to date. A report by the Business Standard has claimed that the Seattle-based tech giant is in the final stages of talks with the regional government in Telangana, and has supposedly “zeroed in on a land parcel” near Hyderabad.
There’s some doubt over the validity of the Business Standard’s claim due to the sheer scale of the reported capital investment. Microsoft is allegedly preparing to spend $2bn to develop the new Hyderabad campus, a staggering sum for a single facility.
It’s even a good deal more than Azure Cloud typically spends on setting up an entire data centre region. Based on the investment and available designs for the company’s other major projects announced this year (including a new cloud region near Atlanta, and a major development in Malaysia) Microsoft tends to build three hyperscale data centres in reasonably close proximity to one another, and tends to spend around $1bn on the first phase of the region.
In India, where construction costs are cheaper than the US, $2bn seems a little high.
For context, Indian firm Web Werks recently announced a $100mn investment in a 125,000 sq ft project in Bangalore, CapitaLand-owned Ascendas India Trust announced that it was planning to spend $162mn on a 90 MW campus in Navi Mumbai, and earlier this year, NTT announced a $2bn investment in its Indian footprint as part of an expansion project that would add more than a million square feet spread across six different facilities.
There are three possibilities: local news sources are just plain wrong, which is definitely possible; Microsoft is paying well over the odds for a new region, which is highly unlikely; or the cloud giant is planning what may be the biggest data centre cluster in India to date.
Currently, the Indian data centre market is on the cusp of a massive boom, as the country’s digital economy races to catch up with a massive population and rapid economic growth. It’s no secret that data centre demand (which already far outstrips supply) is only going to grow. A $2bn development from Microsoft could be the most compelling demonstration of this trend that we’ve seen so far.
Even so, it would definitely be a break with established practice - something that hyperscale cloud firms aren’t often wont to do; Microsoft, Facebook, AWS, and other hyperscale players trade on heavily standardised design principles that allow them to recreate the same level of service and customer experience anywhere in the world.
It’s not like Microsoft is playing catch up either. The company already owns and operates three cloud regions in India, in Pune, Chennai, and Mumbai. All three of those facilities opened back in 2015, however, and six years later, Microsoft may have decided it’s time to take its operations in India to the next level.
Microsoft hyperscale plans prompt Lab3 New Zealand launch
Lab3, an Australian cloud migration specialist, has announced it is launching in New Zealand after being prompted by a surge in demand for cloud services and Microsoft’s investment into hyperscale data centres.
The company, which was founded in 2017, has appointed David Boyes as Chief Executive Officer and Rich Anderson as Chief Operating Officer. According to Companies Office records, Boyes and Anderson each have a 10% share in Lab3’s New Zealand business. Commenting on cloud migration, Boyes said: “Across New Zealand, in government and every industry sector, organisations are looking to migrate to the cloud to modernise their technology environments.” He added that the Coronavirus pandemic was fuelling a “ need to tap into the power of data, facilitate remote work and meet public expectations of a virtual world.”
Chris Cook, Group CEO of Lab3 said the business was "first and foremost about client success" which drives the company’s product innovation and motivation to expand into New Zealand. “We look forward to working closely with Microsoft to deliver more for New Zealand clients,” he said.
Microsoft’s New Zealand hyperscale data centre investment plan
Microsoft’s investment into a hyperscale data centre region in New Zealand meant the resulting facilities will aim to provide several organisations with access to the security and scalability of a public cloud without sending data offshore.
Vanessa Sorenson, Managing Director of Microsoft New Zealand, said: “We’ve seen a tremendous acceleration in cloud migration over the past year as organisations have responded to global disruption and conversely, recognised the global opportunities a digital operation brings.
“Our research with IDC shows public cloud technologies are set to create 102,000 local jobs and add [NZ]$30 billion to the New Zealand economy over the next four years, so we’re delighted to welcome a partner of LAB3’s calibre to New Zealand, to help more organisations realise those gains even faster," she added.
Lab3’s clients include several fintech organisations, a global software vendor, Australian federal and state government agencies, and insurance and banking corporations. The company employs over 200 staff and has three advanced specialisations across migrations, Azure virtual desktop, and security.