Future of Data Centers in India

Ctrl S Datacenters Ltd.

PS Reddy, CMD

Structure

• Present Situation

• Market Sizes

• Future Trends

• Implications of these Trends

• Customer Requirements

• Challenges

– IDCs

– DR

• Snapshot of the Future

• Ctrl S: Future Ready

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Present Situation

• ~ 6,00,000 of third party IDC space

• 6 providers

• Largely Tier II and Tier III, no Tier IV

• Telco dominated, driven by bandwidth costs

• Only primary data centers, not many secondary or Disaster Recovery data centers

• Most DR plans end with a tape backup

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Present Situation

• Many user companies – esp. in the IT

sector – feel they know better than

outsourced service providers

• Mostly office buildings converted to data

centers

• Supply side problems

– No second source of power

– Stand alone buildings very costly

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Market Sizes

SOURCE : DATA MONITOR ALL FIGURES IN $ MILLION

GEO-

GRAPHY2006 2007 2008 2009 2010 2011 2012

CAGR

2007-

2012

India 662 806 983 1,200 1,467 1,795 2,199 22.2%

Asia 8,135 8,905 9,812 10,887 12,168 13,705 15,558 12.9%

World 45,394 47,602 50,052 52,788 55,861 59,336 63,291 5.9%

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Market Sizes

India 2006 2007 2008 2009 2010 2011 2012

As % of Asia 8% 9% 10% 11% 12% 13% 14%

As % of World 1% 2% 2% 2% 3% 3% 3%

Asia 2006 2007 2008 2009 2010 2011 2012

As % of world 18% 19% 20% 21% 22% 23% 25%

SOURCE : DATA MONITOR

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SOURCE : DATA MONITOR

CONTRIBUTION - DIFFERENT VERTICALS

Geography India World

VERTICALS 2006 2012 2006 2012

Financial Services 28% 33% 23% 24%

Manufacturing 25% 24% 21% 22%

Public Sector 11% 9% 15% 15%

Telecommunications 9% 11% 9% 10%

Retail, Wholesale and Distribution 8% 6% 10% 9%

Travel, Transportation,

Logistics & Hospitality5% 4% 6% 5%

Energy and Utilities 4% 3% 5% 4%

Healthcare 4% 5% 5% 6%

Other 2% 2% 2% 2%

Life Sciences 2% 1% 2% 2%

Media and Entertainment 1% 2% 1% 2%

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New Space in Asia Data Centre Market – 2006-2010

Space Race – Asia Forecast

SOURCE : BROADGROUP

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The Asian Data Centre market will increase by a compound annual growth

rate of 11.5% over the period from 2006 to 2010.

Space Growth Rate - Asia

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Expert Predictions

• India, by far the most exciting market in Asia

• ~ 2 million sft to be added in India by 2010

• India to overtake Japan in Data Centers circa 2011

• Asia would account for a quarter of world Data Center business

• India would account for 3% of the Global market

• In terms of verticals, Indian market not very different

• BFSI, Manufacturing & Public Sector 3 most

important verticals

• Telecom, Retail, and Travel & Logistics the next 3

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Most Discussed Future Trends

• Increasing power density

• Consequent cooling challenges

• And cable management

challenges

• Energy Efficiency

• Green Datacenters

• Chilled water in data centers

• Non-IT equipment more

expensive than IT equipment

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Less Discussed Trends

• Continuous decrease in

bandwidth price

• 50 new Telcos coming up in

India

• Software as a Service

• Global integration of Indian

business

• Global relevance of India

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Bandwidth

• As bandwidth prices fall to about $150 - $200 per Mbps per month, India becomes an attractive destination for hosting.

– Today we are at $500 - $750 per Mbps

per month

– It was at $2000 - $2500 per Mbps per

month, three years back

– How long will this take? 2 years?

– Current US rates are about $100 per

Mbps per month

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Monthly Total Cost, $ / Rack

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

2007 2008 2009 2010 2011 2012

Do

llars

India - 10 kW USA - 10 kW

Monthly Total Cost, $ / Rack

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2007 2008 2009 2010 2011 2012

Do

llars

India - 3 kW USA - 3 kW

Bandwidth

• As bandwidth prices decrease, many more applications and deployments would make business sense within India.

• Power will cost more than bandwidth

• On the demand side, broadband will

become ubiquitous, support a new

level of information intensity, driving

up the demand for content-heavy

applications

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New Telcos

• With new Telco licenses, even after

consolidation,

– Effective competition would increase

– Demand for third party IDC space, ideal for

exchanges, would also increase

• Increased competition

– Reinforces the downward trend in bandwidth prices

– Telco domination of 3rd party IDCs would end

– Everybody would be forced to offer multiple carriers

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SaaS

• SaaS would be firmly established due to

– Improved reliability of infrastructure and applications

– Better and cheaper connectivity

– Increased efforts against piracy, locks, and

unreasonably high prices

• Most of the future software products would

actually be a service

• SaaS providers requirement of IDCs would be

much higher

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Globalisation

• Global integration of Indian businesses would continue apace– Supply chains

– Distribution networks and customers

– Competition

• Global benchmarks would be adopted

– For quality, systems, processes, best practices

• As a result, IT systems would be moved:

– From server rooms to IDCs (Ex: Public sector banks)

– From internal resources to specialists (Ex: Bharti, now Vodafone)

Would become more

global less local

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Global Relevance of India

• BRIC countries are the future giants: Goldman Sachs

• Trillion dollar economy: India would soon be in the top

ten economies of the world.

• Indian companies are acquiring companies abroad

• Practices, Systems, Infrastructure on par with the best in

the world

• India: Preferred global supplier of IT Services

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Implications

• Falling bandwidth

prices

• 50 new Telcos

• Establishment of SaaS

• Globalisation

• Growing Indian

Economy

• Explosion of Data Centres

in India

• 5 or 10 times more than

currently expected

• India would emerge as the

Data Centre and Disaster

Recovery capital of the

world

– Strong, stable democracy

– Rule of Law

– Cost effective

– High quality

– Abundant manpower

– Proven delivery model

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Customer Requirements

• Think of a global customer, not an Indian customer

– 3 kW per rack x 24 kW / rack + √

– N + 1 Redundancy x N + N Redundancy √

– Critical load on UPS x Uninterrupted Cooling √

– 99.6% uptime SLA x 99.9% min. √

– IDC in office building x Purpose designed facility √

– Single power source x Two power sources √

– One bandwidth source x Two or more √

– 8 week set up time x Days, not weeks √

– Single Data Centre x Primary + Secondary (DR) √

• Requirements will go beyond the above

• Emerging Challenges will demand new solutions

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Cooling ChallengesCtrlS

Higher Power Density

• Cooling as critical as

power

• Redundant cooling

required

• N + N, not N + 1

• In both outdoor and

indoor cooling units

• Uninterrupted cooling

• Temperature rise

during generator start

time (20 s)

– 3 kW / rack: 1 oc

– 24 kW / rack: 30 oc

• Chilled water reservoir

alone would not suffice

• UPS powered indoor units

required

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Power Sources

• Customers will insist on 2 power sources

• Sub-optimal solution: In existing situation

– Dedicated power cable

– 2 Sub-stations of utility

– Each Connected to at least two different power plants

• Optimal Solution

– Set up a in-house power plant

– ITPL, Bangalore is already doing it!

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Disaster Recovery

• DR Plan mandatory Action Plan

• Ctrical component: Secondary Data Centre or a DR Data Centre

• Ideal Location

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Nothing but the Ideal Location

• No Natural Disaster

– Earthquake

– Floods

– Cyclones

– Landslides

– Volcanic eruptions

– Tsunami

– Tidal Waves

– Hurricanes

– Tornadoes

– Wildfires

– Blizzards

• No man-made Disaster

– War

– Civil war

– Terrorism

– Fire

– Industrial Accidents

– Epidemics

– Strikes

– Looting

– Arson

– Transportation links breakdown

– Communications links disruption

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Key Challenges

• N + N redundancy in cooling

• Uninterruptible Cooling

• 2 Sources of Power

• Critical examination of location

• And, more

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Snapshot of the Future

• Nuclear proof Data Centre

• Measured in acres, not square feet

• Power plants, not DG sets

• Human-proof dark data centers

• Data Centres would not be Telco driven

• Data Centres would host Telco switches

• Infrastructure Management would be

a major practice of all Indian IT companies

• India: IDC and DR capital of the world

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Snapshot of the Future

• Disaster Recovery Plans would be widespread

• All major companies would have a primary data centre backed by a

secondary data centre for Disaster Recovery

• Hyderabad and Bangalore would be the DR Locations of choice

• Detailed and tested Business Continuity Plans would be in place

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– No risk of

• Cyclones

• Storms

• Tidal Waves

• Tsunami

• Floods

• Volcanoes

• Etc.

– Rainfall

• Highest in 130 years is 254 mm in oneday

– Least prone to earthquakes in India

– Away from potential war zones

– Availability of skilled manpower

– Peaceful, law-abiding, cosmopolitan city

Hyderabad – A Favorable DR Location

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About Ctrl S

• Promoted by a 15 year

old group

• Group Investors include

major financial institutions

– Och-Ziff Capital, the world’s

5th largest fund with $31

billion of unleveraged funds

under management

– IDBI Bank, one of India’s

largest financial institutions

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About Ctrl S

• Rolling out Tier IV Data Centres

across India

• Spread over 7 Lakh square feet

• Focused on Disaster Recovery

• DR and Business Continuity

seats in multiple locations

• Pilot operational in Hyderabad, India

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About Ctrl S

• Current customers include

– A large $125 bn global Telco major

– A multinational manufacturing conglomerate

– A pan-Asia VPN service provider

– Manufacturing companies

– Content companies

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Questions?

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