Equinix and du to invest $80 million in data centers in Dubai

Infotech Lead Middle East: Equinix and du, a telecom operator in the United Arab Emirates, will invest $80 million to set up data centers in Dubai.

Offering faster Internet speeds in the Gulf region, the hub will be the first of its kind in the Middle East and would be operational from January 2013. It will be carrier neutral, meaning telecom operators other than du will be able to use it.

Equinix has about 90 data center facilities globally and 4,000 customers including IBM and HSBC. The California-based data center company has bought a newly-built mid-sized data centre in Dubai and will invest $40 million in the project.

Du will invest a similar amount over the next five years, providing connectivity and managed services to tenants, which are likely to include financial institutions, telecom carriers from other regions and internet content providers.

The alliance also plans to open a second facility in Abu Dhabi that would require additional investment, but the companies declined to provide further details.

“People’s expectations about the speed of throughput and content is constantly rising and there are many technologies to improve performance, but one of the fundamental ones is to locate the content as close as possible to the end user,” Eric Schwartz, Equinix president for Europe, Middle East and Africa, told reporters on the sidelines of a news conference.

“With this facility the more applications and content that are located here in the Middle East versus being served somewhere in Europe or Asia, people will see meaningful performance increases,” Schwartz added.

The bulk of data held at the Dubai center is likely to come from international firms using it as a hub to re-route traffic to and from other regions, with some traffic diverted locally, said Mahesh Jaishankar, du vice-president for investments.

Du said it would not seek to extend the alliance to other Middle East countries, but Equinix said it may expand its presence in the region.

Its historic concentration is in the major European, American and Asian capitals – this is the next step for Equinix.

Recently, Equinix opened its newest data center in Shanghai (SH5). The new center will address the demand premium data center services in China from global customers looking to expand in the market.

Following the $230.5 million acquisition of Asia Tone in July 2012, Equinix gained a total of six data centers and one disaster recovery center located across Hong Kong, Shanghai and Singapore, including SH5.

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