Matthew Hall June 28, 2012
The Communications Minister, Senator Stephen Conroy, told American IT leaders Australian states are ready to do business. Photo: Jessica Shapiro JLS
Senator Stephen Conroy is pitching Australia as a home for international data centres contradicting his own fear of an oversupply.
The Minister for Broadband, Communications and the Digital Economy, recently spoke to American IT professionals and investors in New York and invited his audience to come to Australia to build data centres in Tasmania, Queensland and South Australia.
Conroy admitted concern of a possible data centre glut in Australia resulting from a number of new centres opening and planning to open soon, but highlighted environmental and tax-break advantages offered by Australian states to international companies.
"We have state governments that compete viciously with each other to bring businesses to Australia," Conroy told the audience at the Australian Consulate in New York while extolling the benefits of the NBN.
"As an Australian government, we tend to not provide packages and tax incentives at a federal level but state governments are very competitive.
"If you are a data centre and want to come to Australia I can put you in touch with three state governments. Tasmania [has] incredible hydro and is a good place for a data centre to be with very environmentally-friendly electricity. It is cold so you don't have quite their air conditioning bills that you would have in other states, like Queensland, for example.
"But state governments - Tasmania, South Australia, Queensland - would knock themselves over for you to come to Australia. There are state government initiatives that are very attractive to try and bring business to Australia."
Senator Conroy said that recent meeting with officials from Equinix, an American company that has data centres around the world, quashed his own concern for a potential oversupply. Equinix representatives, Conroy said, predicted significant future growth of data traffic within Australia.
In what could be a case of build it and data will come, HP recently opened a data centre in western Sydney to cater for local clients' demands while demand for data centres in Melbourne is also high. Publicly-listed NextDC will open its first Melbourne facility on July 4 and already operates data centres in Brisbane while planning others in Canberra, Perth and Sydney. Macquarie Telecom is opening a second data centre in Sydney next month, while Telstra is spending $800 million to open a new data centre, upgrade its existing facilities and provide more cloud services to clients wanting to keep data and applications onshore.
In addition, this month Amazon Web Services added a long-rumoured Australian data centre to its network, to be used for AmazonCloudFront, a web hosting service, and Amazon Route 53, a domain name system hosting service.
"There are so many data centres opening in Australia at the moment that I said to the Equinix guys who came to see me that we are going to have a bit of a glut coming because there is just so much interest in Australia at the moment."
"[Equinix] were pretty confident that with data growth that there was [not] going to be a glut. But data centres are something that can hold us back.
"The new designs of the data centres are beginning to be pretty efficient. I'm not saying they don't use a lot of electricity but they have adopted a lot of green principles. Our data centres are getting better at being more environmentally efficient."
While Senator Conroy pitched international companies to build data centres in Australia, he also revealed the Federal government is preparing to release a report on how the Commonwealth may use offshore data centres in the future.
"We also have a government discussion paper coming out shortly about how much Australian government data should be stored onshore versus be allowed to go offshore," he said.
"This is a very legitimate debate. There's a lot of debate that we should allow everything to go offshore. Would you let your Defence Department data to be stored in China or the US? I don't think so. To take the approach that it can go anywhere it wants is probably not the best. But does every single piece of government data need to be stored onshore?"