Reliance Globalcom doubling data center operations

Reliance Globalcom doubling data center operations

Hong Kong: The global unit of India’s Reliance Communications will more than double its data centre operations over the next 18 months, in a bid to compete with world leaders such as AT&T and BT, its CEO said on Wednesday.

Reliance Globalcom is planning to add 1 million square feet of new data centre space to complement its existing 600,000 square feet in India and 250,000 square feet outside the country, CEO Punit Garg told Reuters in an interview in Hong Kong.

“We should be adding half of that in the next six to seven months," he said. “The rest would be in the next 12 months after that."

His unit, which now generates about $1.6 billion in annual revenue, or nearly a third of Reliance Communications’ total, has notched breakneck growth in recent years as it leverages its Flag global cable network acquired earlier this decade to become a world player.

That growth should remain brisk, but could slow somewhat from the rate of about 20% in the third quarter versus second quarter levels, Garg said.

“I expect quarter-on-quarter high single-digit (growth) consistently," he said. “When I look at our backlog, I’m confident we’ll continue with this story for at least the next four to six quarters."

Reliance Globalcom is the world’s biggest direct owner of undersea cable networks following its Flag purchase, with some 65,000 miles of cable covering 60 countries.

It sells capacity on the network to many of the world’s major carriers, including U.S. firms AT&T and Verizon, France Telecom and BT in Europe and KDDI Corp and SingTel in Asia.

But such carrier deals only account for about 20-25% of its revenue, with the rest coming from its sales to corporate customers for more lucrative telecoms services like those supplied by providers like AT&T and BT to global companies.

The doubling of its data centre space is partly designed to cater to its growing global clientele, as demand for such capability grows with the global take-off of broadband services that allow for the quick transfer of large amounts of data.

“You get revenues today not for capacity, but for services," Garg said. “Enterprises pay not for capacity but services."