SAP to open Sydney data centre this week

SAP will open the doors to its first major Australian data centre before the end of the week, making its HANA enterprise cloud offering available locally to Australian customers for the first time.

SAP's Paul Muller

The investment comes as a direct response to concerns about data sovereignty and latency in application performance associated with offshore-hosted instances of SAP systems.

The SAP data centre will be co-located in a Sydney facility.

SAP’s Australian general manager of platform solutions, Paul Muller, declined to name the facility due to a "non-disclosure agreement", but told iTnews it was a "mainstream data centre provider”.

The onshore data centre represents the expansion of SAP’s global data centre strategy into the Asia Pacific region.

Sydney was identified as the site with the highest level of market demand, Muller said.

SAP is already looking to other Australian urban centres for a lease in a second co-located facility, which it expects to announce before the end of the year.

“We know that before long our customers will start to come to us asking about their disaster recovery options, and many will be looking at having these in different locations,” Muller said. “So we are currently reviewing a second facility.”

While Canberra represents a big market for the software company, Muller said it wouldn’t be the automatic option for the second site.

“In most cases location is not that critical as long as it is in Australia,” he said.

An onshore presence is expected to overcome some of the data sovereignty concerns that plague enterprise clients looking to move into the cloud, particularly from the public sector.

Federal Government agencies are required to obtain written approval from their departmental minister and the Attorney-General before they can host any private customer information overseas.

But Muller said speed and performance was increasingly outweighing data sovereignty as a primary concern as more core business processes transition onto cloud environments.

“Tasks like reporting may not be urgent and as such a client might be happy to have them sit in the offshore cloud," he said.

“But more and more companies are seeing what we are doing with HANA and want the advantage of being able to process in-memory, coupled with the advantage of having a data centre on shore. This way we can offer what is effectively real time compute processing."

SAP expects to have the first client workloads up and running in the new facility within 30 days of its April 3 open date.

Muller said an initial footprint inside the Sydney data centre comprised "enough hardware, storage and memory to run the [HANA Enterprise Cloud] HEC environment and associated applications".

"We have tried to make sure that we have enough capacity right now to get us through the next six months, and then we will have the option to scale out further," he said.

“From then on we will be in a position to add on isolated customer domains as each customer comes on board."