Gearing up for a trillion-dollar growth prophecy

Hyper-connectivity, AI surge, and evolving trends set the stage for a data centre evolution with massive investments and transformative impacts

By the time you are halfway through reading this article, close to 8 million search queries will have been generated on Google. That’s just one example of living in an always-available, hyper-connected world. While the exact number is not known, it is estimated that 120 zettabytes of data and information are created, captured, copied, and consumed each day. This data needs to be stored and computed in a centralised place equipped with up-to-date computing and networking equipment to process and manage it. Data centres, the unsung heroes of the digital age, play a critical role in this scenario.

India finds itself on the cusp of a significant IT evolution, where data centres will play a pivotal role in keeping data at the center. The stage is set for both Indian and foreign companies to invest over Rs 1.5 trillion in the next six years, marking a six-fold growth. The country’s data centre industry’s revenues are expected to grow at a CAGR of 17-19% between FY23 and FY25.

The increasing adoption of technologies such as cloud computing and Artificial Intelligence (AI) across industry verticals has led to rising demand for high-quality data centre infrastructure for storage and networking. Predictions indicate that the generative AI market will surge from USD 40 billion in 2022 to USD 1.3 trillion over the next decade. Applications utilising generative AI require substantial computing power and data storage, prompting data centres to invest in and extend their infrastructure to meet this rising demand.

Data centres must go beyond basic infrastructure and offer solutions like managed services, cloud support services, and fibre connectivity.

NEED FOR INFRASTRUCTURE

Data centres are the world’s greatest energy guzzlers and applications using generative AI need a lot of computing power and data storage devices. This is pushing data centres to invest in and extend their infrastructure to handle the rising need for processing power and storage capacity as the adoption of generative AI increases, which will alter the data centre landscape.

Estimates indicate that generative AI data centre server infrastructure plus operating costs will reach more than USD 76 billion by 2028 if current trends continue. This growth will put pressure on the profitability of emerging services such as search, content creation, and business automation that use GenAI.

Besides, the data centre infrastructure also needs to evolve to meet these requirements. Several technology trends and capabilities play a crucial role in addressing these requirements.

Scale of operation: The shift towards large campuses is essential, leveraging synergies such as power availability, substations, fibre availability, and utilities. This approach is crucial to meet the escalating demands, potentially leaving small-scale data centres and individual sites at a disadvantage in the long run.

Computing power and cooling: The rise in computing power density, especially driven by AI applications, poses challenges in terms of energy efficiency and sustainability. Data centres must be designed to handle the significant heat generated by the server computer density required for AI. This involves ensuring adequate power provisioning and implementing efficient cooling mechanisms.

Speed of build: The demand for data centres is outpacing supply, making the speed of construction a key factor in meeting these demands efficiently.

Continual innovations: Staying ahead of the curve requires continuous innovations to achieve optimal availability and Power Usage Effectiveness (PUE). Businesses are placing a strong emphasis on energy-efficient designs to reduce operational costs and environmental impact. The adoption of innovative cooling technologies is particularly sought after to ensure optimal energy utilisation.

High-rise data centres: In metropolitan areas like Mumbai and Chennai, the ability to construct high-rise data centres becomes crucial to optimise limited space.

Customisation and flexibility: Adaptable data centres with customised designs are essential to cater to diverse customer requirements effectively.

Vertical integration: Integrating design, construction, and operations capabilities vertically streamlines the overall process and enhances efficiency.

End-to-end solutions: Data centres must go beyond basic infrastructure and offer comprehensive solutions, including managed services, cloud support services, internet connectivity, fibre connectivity, and more to meet the evolving needs of clients.

The rise of edge computing has also led to a demand for smaller, distributed data centres that can process and analyse data closer to the source. These facilities need to be designed for efficiency and compactness and are needed in all major cities of India in the next 3-5 years.

AI and machine learning also have the potential to enhance data centre performance and facilitate operation-based technologies such as liquid cooling, exhaustive power capacity planning, infrastructure enhancement, backup mechanisms, power distribution efficiency fine-tuning, and integration of renewable energy sources.

In conclusion, the evolution of data centres is intricately linked to the rapid advancement of technology. As we stand on the brink of 2024, data centres are not only becoming more sophisticated in managing massive amounts of data but are also embracing green technologies to ensure sustainability and efficiency in an ever-connected world.

By Vipin Jain

The author is the President of Data Centre Operations at CtrlS Datacentres.

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