Does it pose opportunities for Ireland’s data centres?
After Britain’s shock referendum result to trigger Article 50, the world has turned red hot on the “Brexit” debate and its knock-on implications for political, cultural and economic life within the United Kingdom and around the world. It is difficult to read any business publication, listen to a radio broadcast or attend any business event without a politician, business leader or economist sharing opinions on the future ramifications of their decision.
The trigger of Article 50 will affect all industries and economies from Britain to Bangalore. Some have suspected these commentators are guilty of fear-mongering and deception with strong vested interests in the potential outcomes.
Digital data storage
One area which has received little debate or commentary is the area of digital data stored in the UK and more specifically the future of the data centres that house this data. The UK data centre industry is a multi-billion pound business with London as the epicentre of this industry. London city accounts for more than 33% of all the UK data centre capacity. London is sitting as the largest data centre market in Europe and the third largest globally. Any knock-on economic impact to London from Brexit, will most certainly have an impact on the storage of digital data and data centre business in the city.
The core of London’s success as the epicentre for data centre business is intrinsically linked to its role as a global hub for trade and commerce. In particular London is a major financial centre, home to Europe’s largest stock exchange, foreign exchange and international banking. The success of London’s data centre business extends far beyond the financial industry – however over one third of the data housed there is related to the financial sector.
Post Brexit, it is very difficult to see London operating externally from the EU as the financial capital of Europe. We are unlikely to see the entire financial sector exit overnight. Nevertheless we will expect to see a number of financial operations relocate to Paris, Amsterdam, Frankfurt or Dublin. Another factor driving the migration is the hot topic of data residency and strict legislation around storage of data within the EU. This will result in data being transferred outside of the UK.
Migration of data
In the medium to long term, it is predicted that London will see data centre business exit. However it is expected that British data will return to the UK, which will provide a balance on the scales with an expected overall negative impact.
Of course, this uncertainty provides opportunity to those data centres which reside within EU cities – state of the art data centres such as Dublin based facilities, Viatel and Dataplex. Viatel has already experienced an increase in tentative queries from companies currently hosting digital assets in London. These companies are already planning on migrating data to locations that have a certain future in the EU.
Degree of uncertainty
Data centre locations such as Dublin, Frankfurt, Paris are expected to capitalise on the demand for data storage space in a more certain location. With so much uncertainty around the road ahead for Brexit, it’s impossible to predict the exact size of the opportunity for Dublin data centres and as with all other industries – we are reduced to speculation.
If you are considering moving your data to Ireland, contact Viatel to hear about our our data storage solutions we provide at our Dublin-based data centre facility.