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The DC market growth is real, but will go through a small reality check: Sumit Mukhija, STT GDC India

Jan 16, 2023
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Sumit Mukhija
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While the exponential growth of data centres is real, the acid test for some micro-markets is around the corner, believes the CEO of one of India’s leading data centre companies.

 

 

“Over the last 3 years, digital has gone mainstream in India with more and more powerful and relevant use cases and business models are emerging, that the enterprises, governments, users and consumers are leveraging. This will be further catalysed by the 5G rollouts that are happening.”

 

Sumit Mukhija, the CEO of ST Telemedia, Global Data Centres (STT GDC) India

 

All this has led to massive amounts of data being generated and consumed. More data means more cloud deployments and therefore more data centres to support those deployments

 

Despite having the second highest number of internet and smartphone users in the world, India’s data-centre capacity per user lags behind even much smaller countries and economies; the Indian market is hugely underserved.

 

It is therefore no surprise that the market has witnessed huge investments being made in the last 3 years - 2023 to 2025 will be no different and these huge capacity build outs and investments will continue...

 

So, the opportunity is huge and India's data centre capacity is going to double every 3-4 years over the next 10 to 12 years.

 

In a conversation with ETCIO, Sumit Mukhija talks about industry, strategies, plans and the STT GDC’s  sustainability agenda.

 

Edited Excerpts from the Interview:

 

What, in your opinion, is the outlook for the Indian data centre industry for 2023. And what typically, will be the game changers of the industry?

 

The opportunity is huge and India's data centre (DC) capacity is going to double every 3-4 years over the next 10 to 12 years. The good part is that the demand will also continue to increase and DC capacity uptake by customers will continue to grow.

 

However, towards the late part of 2023 and most parts of 2024 and 2025 will also be the acid test for the datacentre market in India.

 

Specifically, some micro-markets like Mumbai which have seen massive investments over the last 2 years will be subjected to the reality test in this period, when some of these capacity builds get completed and go into operations phase.

 

The uptake of these capacities in 2023-25 and the operational ability of the new players who have entered the market may have an impact on future investments.

 

2023 will also see renewed focus on sustainability in the data centres.

 

Sustainability is touted to be a key focus for the industry in 2023. How seriously is the DC ecosystem working towards this? What is STT GDC India doing to promote sustainability in its operations?

 

The DC ecosystem is certainly waking up to sustainability in a big way. I can freely comment about us as an organization. As a company both at the group and India level, sustainability has been at the heart of everything that we do. Our Green mission is built on very strong fundamentals that of leadership and transparency - we have a team that is dedicated to look after the green and corporate social and compliance aspects.

 

All of our purpose built facilities have “Green” building certifications.

 

Our teams work relentlessly and use innovation, more efficient technologies and operational best practices to improve upon the power utilization efficiencies across all of our sites and every year. We work actively with customers to understand the kind of equipment they are bringing into the data halls, get their consumption forecasts,Cubic Feet Per Minute (CFM) ) requirements, any specific equipment that requires special attention with reference to airflow direction. We provide each customer with a periodic consumption report and even a set of recommendations, including upgrading or downgrading contracted power basis their consumption.

 

Sustainability for us is therefore a responsibility and a corporate direction.

 

Currently, around 40% of our energy needs come from renewable energy sources and this is likely to reach 60% levels over the next few years. We have pledged to be carbon neutral in terms of operations by 2030.

 

How would you describe the growth trajectory of ST Telemedia GDC?

 

STT GDC India has been at the forefront of the data centre ecosystem in India for more than 15 years. And as part of our commitment to supporting the digital ecosystem in India, we have built a portfolio of 21 facilities across 9 cities totalling more than 200 MW of critical IT load.

 

Infact, almost 150 MW has come in the last 5 years itself.

 

Over the last 6 years, we have delivered exceptional results and grown on all fronts including revenues, profitability, and capacity and most importantly: we have done all this ethically, responsibly, safely, and sustainably.

 

What markets are critical to your business?

 

We have presence in 9 major cities across 8 states in the country and each of these micro-markets are critical to us. As long as we have customers wanting capacity from us in these markets, they will remain critical for us. We will continue to grow in all of these markets.

 

Having said that, we have significant interests in Maharashtra, Tamil Nadu and Uttar Pradesh with large campuses in Navi Mumbai, Pune, Chennai and Noida which we will build further.

 

We are also keenly looking at some of the tier 2 cities and expect to go live in 2-3 such cities over the next couple of years. 

 

The last couple of Union budgets have seen the Government make significant announcements towards DC investments? How have these helped and where else can things be better?

 

Yes, it is heartening to see the Government taking note of the increasing importance and growth of the digital ecosystem in India.

 

In fact, the Union Government has played a key part in the digitization wave by rolling out Jandhan Yojana, FAStag, , citizen services and promoting digital payments, among others.

 

Further, both Central and State governments have come up with draft data centre policies and incentives and some progressive states like Uttar Pradesh, Karnataka and Tamil Nadu have actually rolled out the policies already.

 

In addition, the industry has been accorded the infrastructure status and included in the harmonized list of infrastructure by the Central Government. These are commendable steps indeed and must be lauded.

 

However, a considerable amount of work still needs to be done in getting the underlying departments to understand, endorse and internalize these policies so that providers can actually benefit from these on the ground.

 

The Government's attention is also needed towards the approval timelines for green field projects that need to be much faster and towards promoting and enabling renewable energy through more conducive and cohesive policies.

 

Source : https://cio.economictimes.indiatimes.com/news/data-centre/the-dc-market-growth-is-real-but-will-go-through-a-small-reality-check-sumit-mukhija-stt-gdc-india/97018271