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STT data centre arm set for next stage of global expansion

The chief executive of STT GDC Bruno Lopez said that the company's key client-segments are doing well now, so the company is riding on their growth to fuel its own expansion.


AFTER three years of rapid global expansion, ST Telemedia's Global Data Centres (STT GDC) arm is ready for its next stage of growth, driven by demand from key clients who are themselves in expansion mode, both regionally and globally.

The company's chief executive Bruno Lopez said the company's key client-segments include cloud-services providers, telcos, content and media companies, financial services, the public sector, technology firms and system integrators.

"These customers are driving growth within the data-centre segment," he said, and added that the company is taking advantage of this to fuel its own growth.

Each client segment has specific requirements, but overall, they share characteristics such as a heavy reliance on digital information; they also expect operational excellence and require highly secure infrastructure.

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"We continue to develop service offerings that meet these requirements and tailor them to the customer's specific expectations," Mr Lopez said.

STT GDC provides what is known as co-location services. DC co-location refers to a data centre facility which is shared by several customers, who rent space for their servers and other computing hardware. STT GDC also provides wholesale services, in which one customer rents out an entire DC space.

Typically, DCs provide building cooling, power, bandwidth and physical security.

It would appear that co-location is a big thing in the Asia-Pacific. Structure Research's Market Share Report on this trend last year noted that the Asia-Pacific is projected to surpass North America in co-location market revenue by 2020.

This comes from high-growth markets such as China and India, co-existing with more mature markets such as Singapore, Japan, Hong Kong and South Korea.

Ever since 2014, when STT GDC acquired a 42 per cent stake in GDS Services (a data centre infrastructure and services provider in China), the company has been on the fast growth track. STT GDC now operates 50 DCs around the world. It runs four in the UK through Virtus Data Centres, in which the company acquired a 49 per cent stake in 2015.

STT GDC acquired a 74 per cent stake in Tata Communications' DC business in India and in Singapore last year. This gave it access to 14 DC in top Indian metros, including New Delhi, Mumbai and Bangalore.

The company has 26 DCs in China, thanks to its GDS stake; this has resulted in partnerships with top ICT (Infocomm Technology) players such as Alibaba, AliCloud and Tencent Cloud.

The company has six DCs in Singapore (including a new one that is being built). These are a mix of purpose-built and acquired facilities located in the west and east of the country. It is building its new DC, called STT Defu 2, next to Defu 1, targeted to be completed by next year.

Mr Lopez said the new facility was being built next to the existing one to create a DC camp in the area. "The new facility provides an opportunity for existing customers to expand their operations and provide additional capacity in the area, which is currently quite constrained."

He has good reason to be bullish about his company's growth prospects. Research by Frost and Sullivan has found that the Asia-Pacific DC services market is expected to grow at a compound annual growth rate (CAGR) of 14.7 per cent between 2015 and 2022 to reach US$31.95 billion at the end of 2022.

The report observed that the key driver of growth across the Asia-Pacific is the explosive digital needs of emerging economies with huge populations, such as China and India. These are two countries in which STT GDC already has a strong presence, Mr Lopez noted.

"We feel that we are in the early stages of growth and that there is significant opportunities to expand not only here in Singapore, but throughout multiple regions of the world," he said.

He added that the digitalisation trend will continue and require additional infrastructure. "We will continue to expand our global and local presence with high-quality DC investments through multiple approaches, including DC platform acquisitions, greenfield and brownfield development, DC asset acquisitions and joint ventures with strong strategic in-country partners."

Mr Lopez said that as a company founded and headquartered in Singapore, STT GDC brings a unique Asian perspective and blend of collaboration to multinational companies looking for a springboard into Asia.

"We are focused on providing our customers with commercial flexibility and tailored solutions with scalability to meet their growth needs. We offer a global presence with strong local market insights and expertise," he added.

Mr Lopez said that each employee is a data centre specialist in STT GDC.

"From data-centre design to construction and actual operations, we are highly passionate in introducing new ways of efficient facility operations and constantly seeking innovative solutions to help our customer meet their rapidly expanding business needs, while also focusing on excellence, sustainability by maintaining energy efficiency in running the facilities."

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