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September 23, 2021

AWS plugs New Zealand into cloud empire with data centre build

By Robert Scammell

Cloud giant Amazon Web Services (AWS) will build its first data centres in New Zealand to allow businesses in the country to store data locally and reduce latency.

The Auckland-based data centre cluster will open in 2024, bringing with it a NZ$7.5bn (US$5.3bn) investment over 15 years, AWS said.

It will feature three availability zones – data centres in separate locations that are close enough to provide backup in the event of downtime while still providing high speeds.

AWS has been operating in New Zealand since 2014 but the new data centres will be its largest investment in the country to date. According to the Amazon subsidiary, the investment will create 1,000 new jobs in New Zealand over the next 15 years.

“Our investments reflect AWS’s deep and long-term commitment to New Zealand,” said Prasad Kalyanaraman, vice president of infrastructure services at AWS. “We are excited to build new world-class infrastructure locally, train New Zealanders with in-demand digital skills, and continue to help local organisations deliver applications that accelerate digital transformation and fuel economic growth.”

Organisations that will benefit from the New Zealand data centres include AWS customers Air New Zealand, the Ministry of Justice and agritech startup Halter.

It is the latest infrastructure expansion by AWS as it seeks to maintain its hold on the lucrative cloud market. In May, it unveiled plans to build three new data centres in the UAE that will come online in 2022, and another region in Israel in 2023. It also plans to invest $3.04bn in new data centres in Spain.

AWS also has infrastructure projects in the pipeline in Australia, India, Indonesia and Switzerland.

The New Zealand data centres will fall under the AWS Asia Pacific (Auckland) region and will be operated by a local AWS entity.

In total AWS has 81 availability zones that are currently operational, as spread across 25 geographic regions.

While cloud providers offer software and platforms as a service, infrastructure is a crucial factor in winning new customers.

More data centres mean shorter distances for data packets to travel along undersea and on-land internet cables, which ultimately means lower latency for AWS customers.

Data centres connect to the global internet via a sprawling network of undersea and on-land cables. According to the Submarine Cable Map, New Zealand is connected via five undersea cables.

A sixth cable – the Southern Cross NEXT – is scheduled to come online in 2022 and will become the largest capacity data link between Sydney, Auckland and Los Angeles. It will cover a total distance of 16,148km and carry up to 72 terabits per second.

According to GlobalData forecasts, data centre revenues will reach $948bn in 2030, giving a large market of opportunities to stakeholders.

Want to know who’s on top in the cloud out of AWS, Microsoft and Google? Check out our analysis here.