Price war began in data center business

Ilustrasi (dok)

JAKARTA (IndoTelko) - The result of Indonesia's 2014-2020 Data Center Market Overview and Forecasts study revealed that in the next four years Indonesia needs area for data center reach up to 375,000 square meter, an increase of 29% from the projected needs in 2016 some 290,000 square meters.

The study which was organized by DCD Intelligence (DCDi) as part of an initiative of the Global Data Center Census estimated that the total overall investment value of the equipment and data center solutions in Indonesia will reach up to US $ 850 million in 2020 or increase more than 70% when compared with the estimated value of the investment in 2016.

The growth room is still large and Indonesia is in its early stages of data center adoption, but surprisingly Telkomsigma revealed the fact that industrialized-like cellular tariff war began to spread into this business.

"Tariff war is starting to occur in the data center business. Many players take advantage of the ignorance of the specification, technology and Tiering, consequently the rate comparison is not apple to apple among data center providers by prospective customers, "said Telkomsigma President Director Judi Achmadi, yesterday.

Telkomsigma who earned certification from the Uptime Institute's Tier Certification for the category of Constructed Facilities (TCCF) for the data center in Serpong, certainly has a reasonable thing to offer a subscription fee of about US $ 22 thousand per rack, per year.

"We are just like a car, while driving on a Mercedes. There are providers who seduce potential customers by trading down nearly 20%, and claimed to have Tier 3 and Uptime. It's not comparable, as Telkomsigma is the only player in Indonesia with TCCF certificate. Thus, comparing the price such as Mercedes to Bajaj so is it irrational," he regrets.

Uptime Institute is an organization that provides a certification system with tier-ing. Where the standards set by the Uptime is becoming the global standard for business data centers.

The institute is the first to define the concept of Data Center Tier, as a reference for other standardization bodies such as the Telecommunications Industry Association.

Certification Data Center Uptime split into three stages, namely Tier Certification of Design Documents (TCDD), Tier Certification of Construction Facilities (TCCF), and Tier Certification of Operational Sustainability (TCOs). There are many players obtain TCDD data center certification in Indonesia, but so far only Telkomsigma already has TCCF.

Telkomsigma's VP Enterprise and Wholesales Data Center Sales Alexander Chandra expects the company will adopt cloud computing more observant look at data center services offered to the market.

"Research from IDC stated that these companies spend about 70-80% of the Information Technology (IT) of their yearly budget just to keep the system running. Choose the one with better quality, because the IT infrastructure has become a business enabler instead of a complement," he said.

Strengthen Differentiation
On the same occasion, Frost & Sullivan Indonesia Country Director Spike Choo suggest that data center providers should reinforce the differentiation to win the competition.

"The price is only one component in the data center deals, besides technologies, Human Resources (HR) competencies, power supplies and more. Usually players who rely on low prices to compete because it did not have a strong differentiation in the other components," he described.

He suggested Indonesian data center player not to get caught in a war price because IT infrastructure is needed along with the development of physical infrastructure. "Indonesia is developing its mass transportation, which needs an IT support such as 24 hours data center / 7 days. This means that IT will be the national critical infrastructure. You are now playing with price, how we can re-invest," he advised.

To run the data center business in Indonesia is not as easy as in Singapore or Hong Kong. "In both countries the cost of land is expensive, but the power supply and Internet connection are fairly capable. Indonesia has a cheap land price, so that the operational rice is quite expensive," he concluded.(es)