Equinix builds cloud ecosystem in Sydney

Global data centre kingpins Equinix opened the doors to its third and latest Sydney data centre last week, attracting several cloud computing service providers from day one.

Linked gallery: Photos: Equinix's Sydney3 data centre

The $US65 million, carrier-neutral data centre in south Sydney offers 1000 cabinets today with plans to expand to 3000, a standard power density of 4kvA and a choice of some 60 network providers for connectivity.

[For full specifications and photos, see iTnews’ first look at the facility shot as it was completed in late June].

Canberra-based Cloud Central, Sydney young guns OrionVM and TPG takeover target IntraPower are three Australian providers of cloud computing services that are signed up to take cages at the facility.

Global cloud computing giant Amazon Web Services is also considering the facility, according to speculation first aired by The Australian newspaper.

Equinix refused to confirm any speculation, but the company does host some Equinix racks in the United States and signed an agreement with Amazon last week.

Under this arrangement, customers co-located in any Equinix data centre where Amazon has a presence can be offered a direct fibre cross-connect to Amazon Web Services, rather than connecting over the public internet, providing secure, low latency access to the EC2 cloud.  

‘Ecosystems’ and ‘Magnets’

Doug Oates, vice president of Equinix sales in Asia Pacific told iTnews the data centre provider was looking to build ‘ecosystems’ within its facilities: rapidly filling out co-lo space by attracting ‘magnet’ customers such as trading exchanges and telecommunications carriers.

One example is Chi-X, Australia’s first competitor to the Australian Stock Exchange, which is hosted in a neighbouring Equinix data centre. The hosting of Chi-X encourages many of the financial services organisations that wish to trade on the exchange to also choose Equinix to reduce latency when making transactions.

Oates said the largest of these ‘magnet’ customers that seed a wider ecosystem are occasionally provided financial incentives (discounts) to choose Equinix.

The strategy has led to Equinix enjoying 70 to 80 percent occupancy rates in most of its data centres across the globe.

Equinix Australia managing director Darren Mann said cloud computing was a natural fit for the company’s network of data centres across 38 countries. “We can confidently cater for cloud services in SYD3,” he said.

For a start, Equinix prides itself on only offering space, power and cooling, he said, and has solemnly sworn never to compete with its customers and provide cloud, hosting or telecommunications services.

Sydney-based OrionVM chose Equinix after being swayed by the ‘ecosystem’ model.

“We are trying to reduce the costs involved with providing cloud services in Australia,” explained Sheng Yeo, director at OrionVM.

“The biggest issue is getting data to and from the cloud. Globally, your compute and storage costs don’t vary too much, but connection costs in Australia do – you can be paying up to a dollar a gigabyte.

“Having the ability to connect directly to ISPs through cheap backhaul connect allows us to offer services at a lower cost. With Equinix IP peering you have access to all of the Internodes and TPGs, plus [points of presence] for Telstra, Optus and AAPT. You can lower costs if you are on the same fabric.”

Yeo was also impressed that a small cloud computing provider could form a relationship with Equinix and talk directly about expansion plans, rather than work through a reseller to take space at Global Switch. Further, Equinix offers much shorter contracts than its largest competitor.

He wasn’t concerned whether the addition of local and global cloud giants within Equinix could take away from OrionVM’s points of differentiation.

“It means we have made the right choice,” he said. “They want to become the chosen data centre provider of the cloud. If all the cloud providers are in a large data centre, we can get data between platforms quite cheaply.”

OrionVM planned to follow Amazon’s lead and offer unmetered cross-connect (direct dark fibre connections) to customers within the Equinix facility for secure, low-latency bursting onto the OrionVM stack.

The company was also in discussions with Equinix around the costs of expanding into the company’s other two Sydney data centres 1.5 kilometres away and offering ‘availability zones’ a la the Amazon model.

Melbourne, Osaka, India next on Equinix list

Equinix Asia Pacific president Samuel Lee said the data centre provider was looking at Melbourne as one of several global locations to build a new data centre.

Osaka was also high on the list after the recent earthquake in Japan; as were Chennai and Mumbai in India and Seoul in South Korea.

“We are very disciplined in our focus on Tier One cities and where our customers tell us they want us to go,” he said. “We continually hear Australian customers asking for Melbourne, as the cost of doing business in Sydney is higher.

“Melbourne is very high up on our radar screen.”

Other cities under consideration included Stockholm, Moscow, Madrid, Dublin, Prague, Istanbul, Riyadh, Dubai and Johannesburg.