On the back of a huge growth in the data centre space, Tata Communications is going for an ambitious five-year plan: to almost treble its capacity to one million square feet from the current 400,000 square feet.
Data centres, which allow companies to outsource and remotely operate their data, are growing at a rate of around 25 per cent. As for the city-based Tata Communications, the company has already spent Rs 1,000 crore in the last three years -- to build the current capacity. This time around, though, it would not be spending as much, according to Srinivasa Addepalli, the senior vice-president (corporate strategy) of the telecommunications company.
“Most of the capacity is incremental; so we would not be investing on the entire infrastructure like the building. That already exists,” he said, but not divulge the specific investments they would be making.
Tata Comm is expanding data centre capacity in only Mumbai, New Delhi and Bangalore. “These are cities where we see growth, and where most of our data centres are running with more than 85 per cent capacity utilisation,” Srinivas revealed. The company has data centre operations in seven Indian cities -- Hyderabad, Pune, Chennai and Kolkata, besides the three mentioned first.
This expansion, the official said, would help the company gain more market share in the data centre business. They currently have a market share of under 20 per cent and hope that it would grow to 25-30 per cent in three years. “We are currently not the number one player in data centres. Yes, we could be -- if we reach the targeted market share,” he added.
Even as a major part of data centres in India are currently captive. That is, they are being built by companies themselves and operated. The outsourced data market is currently around $250-300 million (Rs 1300-1580 crore). It is expected to grow to around $1 billion (Rs 5,200 crore) in the next five years.
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It is this growth that 1986-founded Tata Communications wants to capitalise. Srinivas claims that the trend has already picked up, and there is a data explosion waiting to happen. “The amount of data being used by both individuals and enterprises has gone up -- be it the number of e-mails or information being stored, shared and in video form, the usage of heavy data is growing,” he notes. It is not possible for companies to store all the information they generate.”
In addition to the number of smaller businesses starting outsourcing, companies which outsource are also increasing the extent of outsourcing. “There is only some amount of critical data which is used by companies on a daily basis. While that is being retained, the rest is being stored at data centres,” notes Srinivas.
The growth in data centre outsourcing is coming mostly from banking and financial services, media and online companies, and government. “Any business which has relatively large customer base, collects, stores and processes data and uses information technology applications is our customer,” Srinivas adds.