Russian Data Center Market Grew 20% in 2014

In 2014, according to a new report by international market research company PMR, the Russian market of commercial data center services reached 11.7 billion rubles (approximately $303 million at the average 2014 exchange rate), up 20.4% from the previous year. Development forecasts for the next few years remain positive.

Organic growth is driven by the rapid development of the online economy and the growing volume of data in corporate IT systems. Russian data centers  increase supply of premium colocation space, charging higher service prices.

According to PMR, the total number of commercial data centers in Russia rose to 175 at the end of 2014, with 10 new facilities built in the country during the year. Russian companies also expanded the capacities of their operational data centers by adding new server rooms.

Interestingly, 9 of the 11 new data centers built in Russia in 2013 were projects carried out by MegaFon, a major mobile operator, or Rostelecom, Russia’s national telecom operator.

Earlier this month, Rostelecom announced the acquisition of a majority stake in SafeData, a leading operator of commercial data centers, traffic exchange services and content delivery.

Russian_data_center_market

More than half of the demand for colocation comes from Russian banks and financial institutions, which use commercial data centers to back up their databases and IT systems. The banks usually rent space for 5-15 racks, which is sufficient for critical backup, notes PMR. One of the major local data center services providers, Dataline, reported that banks rented 8 racks on average in the company’s data centers in 2013.

Other important customers include online stores, various e-commerce projects, media companies and retailers. These customers usually rent several racks or only a few units to host their servers.

One of the most important features of the Russian data centre market is that vast majority of the facilities are located in the Moscow and St. Petersburg areas. The capital accounted for approximately 70% of net floor space in 2014, followed by St. Petersburg with 18%.

The regional commercial data center market is represented by smaller facilities. However, demand for data center services outside the main Russian cities remains limited, PMR notes.

New legislation requires to store Russian citizens’ personal data on servers that are physically located on Russian territory starting from September 2015.

This article originally appeared on EWDN on January 28, 2015