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High Cost of Skills and Skills Shortages to Trigger Growth for Data Centre Services in South Africa Finds Frost & Sullivan - To succeed, service providers need to achieve effective energy management and overcome rising real estate costs - CarrierNetworks.Frost.com
High Cost of Skills and Skills Shortages to Trigger Growth for Data Centre Services in South Africa Finds Frost & Sullivan

 

PRZOOM - /newswire/ - Cape Town, South Africa, 2011/12/05 - To succeed, service providers need to achieve effective energy management and overcome rising real estate costs - CarrierNetworks.Frost.com.

   
 
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Data loads worldwide are constantly increasing, and this trend is set to persist. The uptake of data centre services, therefore, is forecast to be high during the next seven years, with intensifying competition between service providers.

New analysis from Frost & Sullivan (carriernetworks.frost.com), Data Centre Market in South Africa, finds that the market earned revenues of $353 million in 2010 and estimates this to reach $977 million in 2016. The research covers co-location, managed hosting and managed services across the financial services, government, ICT, media, retail, healthcare, mining, manufacturing, oil and gas and transport application industries.

"The lack of in-house capabilities is driving the demand for co-location and hosted services within the South African data centre market," notes Frost & Sullivan's ICT Business Unit Leader for Africa, Birgitta Cederstrom. "Enterprises lack the in-house capability to meet changing business requirements such as on-demand bandwidth, storage facilities, near-100-per-cent system uptime, high-speed internet and network security."

South Africa, in general, lacks skilled manpower that can manage and maintain advanced data centre technology. In addition, highly skilled personnel charge a premium for their services, with some of the manpower being imported from overseas. As a result, companies are using third-party providers to manage specific data centre activities.

From real estate and construction, to power and cooling, creating data centres requires significant investment. Data centre providers have to deal with the increasing cost of real estate and power usage, which proves to be a challenge for growth within the market.

In 2010, property prices increased by 5 per cent. The power segment had also been impacted by electricity price hikes initiated by the South African energy and power company—Eskom. The company has implemented a strict pricing strategy in its bid to build new power stations and consumers are expected to pay approximately 31 per cent per year over the next five years.

"To combat the increasing costs of real-estate, service providers should consider building smart in order to accommodate what does happen, instead of what might happen," advises Cederstrom. "Service providers should also focus on energy management and efficiency, re-thinking their power utilisation efficiencies (PUE) strategies."

Managing a data centre actively can result in approximately 40.0 per cent, or more, in improved energy savings and importance is, therefore, placed on energy management. Organisations are going green, considering natural cooling, detailing energy management and centralising customers to reduce their loads.

A typical data centre requires a PUE between 2.5 and 2.8. For every 1kW of power, the PUE (2.8) is multiplied by the rate charged by Eskom. Service providers, therefore, are focused on decreasing the PUE to 1.5, thereby passing cost savings to the customer.

"Service providers should design data centres that can be built in stages so that it would have room to grow without paying for unnecessary space," concludes Cederstrom. "In addition, instead of trying to project growth, it will be necessary to build in order to meet those projections ahead of time."

If you are interested in more information on this study, please send an email with your contact details to Samantha James, Corporate Communications, at samantha.james[.]frost.com.

Data Centre Market in South Africa is part of the Communications Infrastructure Systems & Software Growth Partnership Services programme. It includes research on: co-location, managed hosting and managed services across the financial services, government, ICT, media, retail, healthcare, mining, manufacturing, oil and gas and transport application industries. All research included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.

About Frost & Sullivan
Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best-practice models to drive the generation, evaluation, and implementation of powerful growth strategies. Frost & Sullivan leverages 50 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from more than 40 offices on six continents.

Data Centre Market in South Africa / M6F4-60

 
 
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High Cost of Skills and Skills Shortages to Trigger Growth for Data Centre Services in South Africa Finds Frost & Sullivan

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