New technological trends such as AI-generated content, quantum computing, and 5G expansion are driving an insatiable demand for new data centres worldwide. In South Africa, this demand is particularly pronounced as the country positions itself as a critical hub for digital innovation and transformation across the African continent.
The data centre industry is set for substantial growth, largely fuelled by technological advancements and a rising demand for digital services. Strategic investments and collaborative efforts will empower South Africa to solidify its role as a pivotal player in the global data centre market.
Substantial investments are being funnelled into the data centre market to keep up with technological advancements and the rising demand for digital services.
The explosion of AI applications necessitates robust data storage and processing capabilities. AI-generated content and machine learning models require vast amounts of data and computational power, both of which are provided by data centres.
Though still in its nascent stages, quantum computing promises to revolutionise data processing speeds and capabilities. This emerging technology will further drive the need for advanced data centre infrastructure capable of supporting quantum operations.
The rollout of 5G networks enhances connectivity and increases data transfer speeds, leading to more data generation and the need for faster processing and storage solutions. Data centres are essential to manage this increased data flow and provide the necessary computational power.
In South Africa, several key developments underscore the country’s commitment to expanding its data centre infrastructure.
Microsoft has announced plans to build out its cloud infrastructure in new areas of South Africa to meet growing demand from both public sector and private organisations. This expansion is part of Microsoft’s broader strategy to accelerate digital transformation in South Africa and across Africa.
Microsoft initially entered the South African market by opening two Azure regions in 2019, in Johannesburg and Cape Town. However, the Cape Town region was de-listed at the start of 2021 and may have been re-classified as a ‘reserved access region’.
AWS launched its own cloud region in Cape Town in April 2020. Oracle followed suit, opening its Johannesburg OCI region in January 2022. Telkom subsidiary BCX launched an Alibaba cloud region in Johannesburg last year, and Google recently inaugurated its first GCP cloud region in Johannesburg recently.
The north and east of Johannesburg have emerged as preferred locations for major data centre operators. Areas such as Midrand, Samrand, Isando, and along the R21 highway host a high concentration of data centres, including those operated by Africa Data Centres, BCX, NTT, Vantage, and Teraco.
These areas are attractive due to the availability of suitable land and the necessary infrastructure to support large-scale data centres. However, the availability of electricity remains a critical factor in determining the viability of these locations.
South Africa’s ongoing energy challenges necessitate innovative solutions and significant investment in reliable power sources to ensure the uninterrupted operation of data centres.
As stressed, the expansion of data centre infrastructure is crucial to the country’s ability to harness the potential of AI, quantum computing, and 5G. To meet this demand, it is essential for stakeholders, including government, private sector, and international partners, to collaborate on the development of data centres.
This includes addressing challenges such as energy availability and ensuring the necessary regulatory and policy frameworks are in place to support the growth of this critical infrastructure.