CenturyLink, NTT on new wave of data centre investments on mainland
Operators follow on from HK investments with expansion plans involving mainland partners
After making heavy investments on facilities in Hong Kong, international data centre services providers CenturyLink and NTT Communications are gearing up to expand their operations in Shanghai with help from mainland partners.
CenturyLink, the third-largest telecommunications company in the United States, and NTT Com, the information-technology services subsidiary of Japanese carrier Nippon Telegraph and Telephone, expect to benefit from growing corporate adoption of cloud computing, e-commerce and mobile services on the mainland.
"For multinational corporations, entering [mainland] China presents enormous opportunities and challenges," said Gery Messer, the Asia-Pacific managing director at CenturyLink, formerly known as Savvis.
Amid regulatory restrictions, CenturyLink has forged strategic local alliances with data centre operator GDS and information-technology services provider Neusoft Corp to help kickstart its operations in Shanghai. Financial terms were not provided. NTT Com is investing about US$20 million to construct an estimated 2,500-square metre data centre in Shanghai's Pudong district.
Akira Arima, the president and chief executive at NTT Com, told the South China Morning Post that the company will operate that facility under the licence of a domestic service provider, which he did not identify.
A data centre is a secure, temperature-controlled facility equipped to house large-capacity server computers and enterprise data-storage systems, which are maintained with multiple power sources and have high-bandwidth links to the internet.
Brian Klingbeil, senior vice-president for international development at CenturyLink, said the firm's first data centre on the mainland is operated by local provider GDS in the Shanghai Waigaoqiao Free Trade Zone.
"CenturyLink's new managed hosting, colocation and cloud presence in [mainland] China is delivered through Neusoft, while Citic Telecom CPC serves as the network services provider," Klingbeil said.
In November, CenturyLink and San Francisco-based Digital Realty Trust jointly opened in Hong Kong a US$200 million, 18,000 sq m data centre, built from a redeveloped industrial site in Tseung Kwan O.
For NTT Com, its Shanghai data centre will focus on supporting the requirements of Japanese firms operating on the mainland. Arima said the facility provided "about one-fifth of the volume" that NTT Com handles at its HK$3 billion facility in Tseung Kwan O that it opened last year.