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Localised traffic, intra-African agenda driving datacentre development

Africa’s small hosting capacity masks the region’s true potential to grow according to recent market research.
Africa’s small hosting capacity masks the region’s true potential to grow according to recent market research.

More local traffic flow and growth of the intra-African agenda have been identified as key drivers behind the demand for datacentre space on the continent.

This is according to a report by the Africa Data Centre Association (ADA), State of the African Data Centres 2020, released in conjunction with Xalam Analytics and Balancing Act.

According to the report global content providers like Facebook and Netflix and cloud providers like Microsoft Azure and AWS are considered driving forces as they expand their content and services into Africa.

They drive Africa-based datacentre demand as they leverage local facilities to extend their digital tools and offer a similar user experience to global counterparts.

Chaired by Fatoumata Sarr, CEO of the Orange Services Group, the ADA believes Africa’s growing datacentre environment offers a massive opportunity, considering that only 85 players currently serve over 1.3 billion population - especially as the link between digitisation and economic growth becomes increasingly clear.

Tobi Ogunwande of MiDrive, which competes in the file transfer market against the likes of WeTransfer, Smash, and pCloud Transfer, said: “Datacentres play a key role in fuelling the cloud industry in Africa. Datacentres are effectively the cloud (and) promote better data proximity to customers, which means faster and more secure applications can be created. Datacentres represent lots of opportunity for IT and software solutions, which in turn help fuel the demand for and creation of more datacentres.”

ADA research suggests that datacentres are increasingly being sought out by more businesses, those that are exploring solutions to serve an increasingly digital customer base - in the face of everyday challenges including managing internal datacentre facilities with intermittent power cuts, and rising real estate and electricity costs.

Nevertheless, the recent growth in the space is “still only scratching the surface of the region’s potential”, the report notes.

It suggests that Africa’s small hosting capacity masks the region’s true potential to grow - currently at around 5% of the world’s GDP and broadband base, and less than 1% of the multi-tenant data centre or co-location (MTDC) capacity available globally.

The ADA expects the MTDC market to grow as more African metros ( with over a million inhabitants - 90% of which are outside of South Africa, the largest market in Africa accounting for 70% of available supply in 2019) - become more active in the datacentre space.

Ogunwande believes the availability of more datacentres will the help the continent which is “teeming with hackers and entrepreneurs itching to bring their ideas to life” but are having their creativity drastically limited because “the only great datacentre options (are) across an ocean."

Xalam Analytics estimates that the total number of edge locations by international network and content providers in Africa is close to 300 and growing by about 10% a year. It also expects at least three global hyperscale cloud providers to offer their services from Africa-based datacentre facilities by the end of 2020.

Major cloud users, including file transfer web apps like MiDrive, always seek to deploy their servers close to their clients to provide fast and affordable cloud storage. While they depend on datacentres for effective service delivery, Ogunwande suggests that the user/provider-datacentre working relationship can be improved through developer advocacy.

“Developers build solutions that run on datacentres. First, there needs to be lots of promotion so that developers are aware that these solutions exist and what they are capable of. The second challenge is the maturity of the service i.e. how stable is it? Does it have a great and developer-friendly API? Is it secure? Is it scalable? Is it affordable? These are all points that any cloud provider needs to get a strong handle on. The customers for datacentres are developers, and developers talk to machines, so the infrastructure needs to be world-class. This will greatly improve trust and relationship with the cloud provider."

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