Werner HOLZAPFEL Smart Busi­ness

Be­larus is step­ping up pres­ence on the global mar­ket of data cen­ter ser­vices

Economy of Belarus - - CONTENTS -

The de­vel­op­ment of dig­i­tal econ­omy based on bulk data is now a uni­ver­sal trend, in­clud­ing for Be­larus. Sev­eral mod­ern data cen­ters have been built in Minsk al­ready. By the end of the year the mo­bile car­rier vel­com in­tends to open the coun­try’s largest Tier 3 data cen­ter that will be­come part of an in­ter­na­tional net­work. The rea­sons are ob­vi­ous: in ad­di­tion to sat­is­fy­ing the in­ter­nal de­mand for stor­ing and pro­cess­ing data, the com­pany in­tends to of­fer its ser­vices in­ter­na­tion­ally. Werner HOLZAPFEL, su­per­vi­sor of the vel­com data cen­ter con­struc­tion project, told the Econ­omy of Be­larus Magazine what Big Data is all about and what ap­peal Be­larus has for a broad­band world.

Vig­or­ous ef­forts have been poured into the de­vel­op­ment of the data cen­ter in­fra­struc­ture in Be­larus in the last few years. What can you say about prospects of this kind of busi­ness?

The mar­ket of data cen­ter ser­vices is rapidly evolv­ing in Be­larus right now. It is not a fluke since the de­mand for this kind of ser­vices has grown no­tice­ably. Be­sides, it is now pos­si­ble to of­fer these ser­vices to for­eign com­pa­nies that are ready to store their data in Minsk. The coun­try’s tran­sit po­si­tion is also an im­por­tant fac­tor. So prospects of de­vel­op­ing this kind of busi­ness in Be­larus are rather op­ti­mistic.

More­over, the emer­gence of ma­jor data cen­ters is one of the con­di­tions for cre­at­ing a dig­i­tal econ­omy, in which telecom­mu­ni­ca­tion in­fra­struc­ture and the creation of in­for­ma­tion prod­ucts play the key role. In lay­man’s terms it is im­pos­si­ble to move on with­out it. It is dou­bly true for Be­larus since the coun­try pins its hopes on the de­vel­op­ment of in­for­ma­tion tech­nolo­gies. The Hi-Tech Park is a vivid ex­am­ple. Its res­i­dent com­pa­nies are known far and wide. So, it is not a know-how, but a de­sire to fol­low global trends?

Ex­actly. The de­vel­op­ment of dig­i­tal econ­omy has been con­sid­ered a global trend for many years. It is no se­cret. Cer­tainly, it does not mean we should aban­don con­ven­tional in­dus­tries. Ev­ery­thing must be bal­anced. In ad­di­tion to form­ing a large and promis­ing mar­ket with­out vir­tu­ally any geo­graph­i­cal bor­ders, in­for­ma­tion tech­nolo­gies also con­trib­ute to the de­vel­op­ment of other branches of the econ­omy. We are talk­ing about sym­bio­sis, not re­place­ment. The world around us is much more com­pli­cated than it may seem at first glance.

It is a large mar­ket. Ac­cord­ing to IDC pro­jec­tions, in 2016 com­pa­nies all over the world will spend $204 bil­lion on pub­lic cloud ser­vices, 16.5% up from the pre­vi­ous year. To com­pare, the global mar­ket of in­for­ma­tion tech­nolo­gies is ex­pected to grow by only 0.6% if we are to trust Gart­ner.

How is the at­ti­tude of Be­laru­sian com­pa­nies to data cen­ters chang­ing? Are they ready to out­source data stor­age?

Their at­ti­tude is chang­ing and rather fast. In the past many medium and large com­pa­nies would set up their own server rooms. Now they have come to un­der­stand that the ap­proach is dan­ger­ous, un­prof­itable, and, most of all, in­ef­fec­tive. The pri­vate sec­tor now uses out­sourced data cen­ters to re­duce costs and get qual­ity ser­vice.

Data cen­ters scale well. The more data cen­ters you build, the eas­ier you can equip and ser­vice them. Elec­tric­ity con­sump­tion is a sig­nif­i­cant pa­ram­e­ter in the per­for­mance of a data cen­ter. If you do it on a large scale, you can con­fig­ure the net­work in a way to re­duce elec­tric­ity costs.

Data se­cu­rity and safety also play a ma­jor role and can be ob­tained only in a mod­ern data cen­ter. Ev­ery small thing counts – from un­in­ter­rupted op­er­a­tion and data back­ups to 24/7 se­cu­rity and mon­i­tor­ing. A com­pany that op­er­ates a data cen­ter as a non-core busi­ness can eas­ily fail to take care of ev­ery­thing. There is a short­age of Tier 3 data cen­ters in Eastern Europe. What main ad­van­tages do they give?

Many large for­eign com­pa­nies do not trust a data cen­ter with stor­ing their data if the data cen­ter lacks a Tier 3 re­li­a­bil­ity cer­tifi­cate. By the way, the data cen­ter that vel­com is build­ing in Kolodishchi has al­ready ob­tained the cer­tifi­cate. But what is all about in prac­tice? First of all, the cer­tifi­cate in­di­cates that the data cen­ter uses only mod­ern equip­ment that can work 24/7/365. All the op­er­a­tions to re­place and add equip­ment will be done with­out af­fect­ing the en­tire in­stal­la­tion. A backup com­mu­ni­ca­tion line is avail­able to keep the servers on­line at any time.

The mon­i­tor­ing sys­tem in a Tier 3 data cen­ter tracks ev­ery de­tail from air tem­per­a­ture to elec­tric­ity con­sump­tion. All the data can be ac­cessed on­line in real time. If nec­es­sary, a video cam­era can be in­stalled to let users see a spe­cific server cabi­net.

A Tier 3 data cen­ter is head and shoul­ders above your av­er­age run-of-the-mill data cen­ter. A Tier 3 data cen­ter com­pares to the av­er­age data cen­ter like a five-star ho­tel can com­pare to a road­side mo­tel. Truth be told, there are only three com­mer­cial in­ter­na­tional-level data cen­ters in Be­larus for now. To com­pare, there are more than 30 of them in Poland, roughly the same amount in Ukraine, and about 50 in Rus­sia.

How­ever, prox­im­ity to Rus­sia and the ris­ing ten­dency to out­source things open up prospects for de­vel­op­ing the mar­ket of data cen­ter ser­vices. It will also al­low rais­ing the in­vest­ment ap­peal of the coun­try and im­prov­ing the busi­ness cli­mate.

I as­sume the avail­abil­ity of Tier 3 data cen­ters will also help im­prove the coun­try’s in­for­ma­tion se­cu­rity since com­pa­nies will pre­fer stor­ing their valu­able data in the home coun­try…

Ab­so­lutely cor­rect. Mod­ern data cen­ters guar­an­tee 100% data safety in the event of nat­u­ral dis­as­ters or lengthy power black­outs. In the past com­pa­nies that needed servers like

The emer­gence of ma­jor data cen­ters is one of the con­di­tions for cre­at­ing a dig­i­tal econ­omy, in which telecom­mu­ni­ca­tion in­fra­struc­ture and the creation of in­for­ma­tion prod­ucts play the key role

Mod­ern data cen­ters guar­an­tee 100% data safety in the event of nat­u­ral dis­as­ters or lengthy power black­outs

that had to find them in Moscow, Kiev, or War­saw. Now they can do it in Minsk and on much more at­trac­tive terms.

What prompted vel­com to build the coun­try’s largest data cen­ter?

First of all, we needed a data cen­ter of our own since we push a lot of data as a mo­bile car­rier. Be­sides, in the last few years the com­pany has been putting se­ri­ous ef­forts into busi­ness di­ver­si­fi­ca­tion. For in­stance, in Septem­ber 2014 vel­com started of­fer­ing wired In­ter­net ac­cess for le­gal en­ti­ties. Over 100 busi­ness cen­ters in Minsk now en­joy vel­com’s wired broad­band In­ter­net ac­cess. We can see that many cor­po­rate clients would like to safely store a lot of data and ac­cess it 24/7.

Will you please tell us more about vel­com’s fu­ture data cen­ter?

All in all, vel­com’s data cen­ter will oc­cupy 7,500m2. In­side you will find eight ma­chine halls with 100 server cab­i­nets in four mod­ules in each hall. Cus­tomers will be able to ac­cess their servers phys­i­cally and re­motely. Their pres­ence op­tions will vary from ded­i­cated server cab­i­nets to ded­i­cated server rooms with a sep­a­rate en­trance. The in­te­rior space can be flex­i­bly con­fig­ured us­ing the open space for­mat. If you so de­sire, you can cre­ate your own data cen­ter and sep­a­rate your servers from the rest.

The data cen­ter’s work­ing hours will be sim­i­lar to a twenty-four-hour hy­per­mar­ket or an air­port ter­mi­nal. Clients will be able to ac­cess their servers even at 2:00 in the morn­ing, se­cu­rity per­son­nel will be in po­si­tion to as­sist. Noth­ing like that has been avail­able in Be­larus be­fore. Be­sides, in ad­di­tion to data stor­age space, as a telecom­mu­ni­ca­tion com­pany we can of­fer a fiber op­tic com­mu­ni­ca­tion line to any of­fice.

What do you want more: sat­isfy the do­mes­tic de­mand or en­ter a promis­ing mar­ket?

We are not try­ing to dis­guise the fact that it is an in­de­pen­dent project with a clear mon­e­ti­za­tion scheme. Vel­com will use only 10–15% of the data cen­ter’s stor­age space. The rest will be avail­able to cus­tomers, pri­mar­ily those who work in Be­larus. These are com­mer­cial banks, IT com­pa­nies, lo­gis­tics com­pa­nies, and re­tail chains. Medium and large en­ter­prises should be in­ter­ested in data cen­ter ser­vices. At present vel­com pro­vides mo­bile com­mu­ni­ca­tion ser­vices to 70% of the cor­po­rate sec­tor, so we know the po­ten­tial clients of the data cen­ter well.

Do Be­laru­sian IT com­pa­nies that cater pri­mar­ily to West­ern mar­kets use the Be­laru­sian data stor­age in­fra­struc­ture? Most of the res­i­dent com­pa­nies in the Hi-Tech Park use out­sourc­ing busi­ness schemes. It is im­por­tant for them to be close to their clients. But we be­lieve they will eas­ily change their minds since data cen­ters com­pli­ant with in­ter­na­tional stan­dards are es­tab­lished in Minsk.

Some Be­laru­sian IT com­pa­nies have built their own data cen­ters. In my opin­ion, it was a sub­op­ti­mal de­ci­sion since main­tain­ing the in­fra­struc­ture costs a lot. Be­sides, it is dif­fi­cult to project the work­load of your data cen­ter through the year. Projects come and go, you may fin­ish your project to­day, while to­mor­row the data cen­ter will be idle.

How much does vel­com’s data cen­ter cost? How fast do you in­tend to re­coup the in­vest­ments?

A to­tal of about $35 mil­lion will be in­vested in build­ing the data cen­ter. The ex­pected pay­back pe­riod ex­ceeds five years. As you see, ev­ery­thing is rather op­ti­mistic. It is a new kind of busi­ness for Be­larus, which we ex­pect will grow rapidly in the next few years.

We are not re-in­vent­ing the wheel. Many com­pa­nies, which are part of the hold­ing com­pa­nies Telekom Aus­tria Group (TAG) and Amer­ica Movil, have al­ready built data cen­ters of their own. But the data cen­ter in Kolodishchi will be the first Eastern Europe data cen­ter of Amer­ica Movil. The data cen­ter will also be­come part of an in­ter­na­tional net­work that com­prises about 30 data cen­ters in var­i­ous coun­tries. Be­laru­sian com­pa­nies will be able to backup data all over the world. It will also en­able more ef­fec­tive work with for­eign mar­kets. Be­larus will be able to more ac­tively ex­port data stor­age and data pro­cess­ing ser­vices.

Will the con­struc­tion of the data cen­ter re­duce prices for data stor­age and data pro­cess­ing ser­vices?

Un­likely. It is more likely that cus­tomers will be able to store their data in a Tier 3 data cen­ter at prices close to those of lower-qual­ity data cen­ters. So, the mar­ket will un­dergo qual­ity changes but you shouldn’t ex­pect prices to take a nose­dive.

What cloud tech­nolo­gies may Be­larus get thanks to the de­vel­op­ment of the data cen­ter ser­vices mar­ket?

The de­vel­op­ment of vir­tu­al­iza­tion tech­nolo­gies will be the next step af­ter the open­ing of data cen­ters. Com­pa­nies will be able to buy vir­tual space from data cen­ters in­stead of pre­cise stor­age or a phys­i­cal server. In other words, In­fra­struc­ture as a Ser­vice (IaaS), Plat­form as a Ser­vice (PaaS), and Soft­ware as a Ser­vice (SaaS) so­lu­tions will be­come more prom­i­nent. All these fac­tors are ex­pected to con­trib­ute to the de­vel­op­ment of in­no­va­tive busi­ness in Be­larus, which re­lies on mod­ern in­for­ma­tion tech­nolo­gies.

What are Be­larus’ chances of be­com­ing an Eastern Europe leader in data stor­age and pro­cess­ing?

The chances are quite high. Truth be told, we need qual­ity in­ter­na­tional com­mu­ni­ca­tion chan­nels in or­der to de­velop data cen­ter in­fra­struc­ture for the ben­e­fit of for­eign clients. If data cen­ter own­ers could build an ex­ter­nal In­ter­net gate­way of their own, the prospects of ex­port­ing data cen­ter ser­vices would go sky high. Ev­ery­one would ben­e­fit from it, in­clud­ing the owner of the data cen­ter, end con­sumers, and the state. These are in­ter­na­tional trends, which Be­larus is un­likely to dodge.

Many cor­po­rate clients would like to safely store a lot of data and ac­cess it 24/7

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