US data centre provider opens two new projects in Melbourne as market continues to swell

The data centre market is continuing to explode in Australia, with American company Digital Realty announcing two new projects to be built in Melbourne that are expected to add an economic benefit of more than $360 million.

The move comes after Bevan Slattery has been pushing forward with his own NextDC venture, while Dell, Amazon and HP are all working on their own projects in the country.

Yesterday, Digital Realty celebrated with Victorian IT minister Gordon Rich-Phillips the ground-breaking of the first of two new centres planned for Deer Park, which are also expected to create 200 new construction jobs.

The construction of these new centres comes during a time when businesses and individuals are using more cloud-based services than ever before, preferring to outsource their IT rather than handle it within their own headquarters.

Such a shift, experts say, has resulted in a number of different organisations believing Australia is a fertile ground for such developments – NextDC is already operating in several capital cities, with Bevan Slattery believing the thirst for data hosting has yet to be quenched.

Telsyte senior analyst Rodney Gedda told SmartCompany this morning the market is growing rapidly as companies look to increase IT outsourcing.

“There is a lot of construction right now, and the main reason for that is it that they’re catering to a market where there is a lot of demand for infrastructure as a service,” he says.

“Basically, what that means is businesses are just wanting to find ways other companies can manage their own IT infrastructure and then use that as a service.”

Gedda says he believes this is where he thinks the market is heading, where businesses lease more time on services in the form of virtual machines or other facilities, and then pay one bill instead of having to manage different pieces of infrastructure in-house.

But he also notes these data centres aren’t anywhere near the size of centres being built in countries such as the United States, where businesses like Apple and Facebook create data centres that span football field-sized areas.

“If you’re a government department you’ve got a lot of money to spend on servers and storage and so on, so it’s not a mass marketing thing like the Googles and Facebooks of the world where they provide services to consumers.”

“This market is more catering to businesses rather than consumers.”

Rich-Phillips said yesterday the project would create 200 construction jobs, and then about 450 positions once the projects are up and running.

“The investment builds in Victoria’s technology capability and adds to our state’s reputation as a natural home for data centres and a leading regional hub for ICT businesses,” he said in a statement.