The African data centre market by investment is expected to reach $5 billion (R76.7 billion) by 2026, with SA forecast to comprise the majority of investments, reaching an estimated $3.1 billion (R46 billion) within the same period .
This was the word from Finhai Munzara, CFO of carrier-neutral data centre providerAfrica Data Centres, speaking during a keynote presentation at yesterday’s ITWeb Cloud & Data Centre Summit 2022.
Munzara is responsible for Africa Data Centres’ financial strategy, planning and analysis, designing and implementing the company’s optimal capital structure, as well as raising capital to fund its strategic growth initiatives.
Providing an overview of Africa’s data centre investment trends and forecasts, Munzara explained businesses across the continent are seeing a massive rise in data centre needs for storage, app development and deployment, hybrid working needs and online customer platforms.
As data demand and cloud adoption continue to cause a surge in traffic, data centres are getting smarter and more intelligent, in order to meet company requirements.
He highlighted the importance of having enough skills to meet the requirements and needs of running smart data centres.
“Africa is undergoing a digital revolution, which could see the internet economy reach $180 billion or 5% of GDP by 2026.South Africa will remain the largest market and will attract the bulk of investment over the next few years.
“While Africa is 17% of the global population, the continent’s data centre market makes up only 1% of the global market. This tells us that a lot of this data that’s being created on the continent is not actually sitting on the continent. It’s stored on a server somewhere else on the globe,” explained Munzara.
Lower costs and operational benefits will drive migration of enterprise IT systems to public and hybrid cloud, a trend that is being rolled out in a phased transition, he added.
The Africa data centre market by investment was valued at $2 billion in 2020, and is expected to grow at 15% CAGR to 2026, driven by the increasing number of hyperscalers choosing to invest in the market.
Since 2019, SA has seen an influx of tech companies investing in local data centres, including hyperscalers like Microsoft and Amazon, as well as the likes of Teraco, Africa Data Centres, Dimension Data and Huawei.
Owned by Cassava Technologies, Africa Data Centres has three data centres in SA, and is on a mission to build 10 facilities across Africa, including in Nigeria, Kenya, Morocco and Egypt, over the next two years.
“South Africa has the largest number of hyperscale cloud provider data centre facilities (22), with roughly seven distinct key players and over 190MW of IT capacity. When you look at the landscape, you see that all this capacity in South Africa is probably almost four times the size of what is available on the rest of the continent and this trend is expected to continue on this trajectory.”
While there is an influx of international players setting up locations in SA and across the continent, Munzara is adamant there is enough room for competition.
“What we are really seeing is that there is a gap on the continent in terms of the available capacity and what is actually required by organisations. Looking at the current frenzy of cloud activity, customers are going to need capacityin the different regions, which is why Africa Data Centres is on an expansion drive,” he concluded.
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