Vision of ‘Digital India’ is no more a distant reality: Sunil Gupta, CEO and Co-founder, Yotta Infrastructure

There is a renewed focus on digitisation ushered by the trends that came into being especially over the last year. However, what is the impact that this new development has had on the data centre industry in India? Sunil Gupta, CEO and co-founder, Yotta Infrastructure answers that and more in an insightful conversation with Dataquest.

DQ: What are the major trends and challenges of managing colocation data centers in India?

Sunil Gupta: The Indian data center market has been on an upward trajectory for the last few years. In 2020, the industry witnessed a pivotal moment with the pandemic, as data centers adapted and mostly thrived, enabled by a growing demand for digital infrastructure. India is currently home to 80+ third-party data centers and investments in the space have also grown exponentially with at least 10 new projects on an annual basis. These investments are estimated to grow at 5% CAGR and reach $4.6 billion per annum by 2025. Additionally, the JLL report predicts that in terms of power capacity (MW), the India data center capacity is expected to grow about three times to 1,078 MW by 2025. Currently, it stands at 375MW.

As such, the colocation data center segment has benefitted from strong growth in companies wanting to relocate their data centers to within the colocation facilities and the adoption of cloud services, either gateways to global Cloud Providers or colocation data centers ability to offer their cloud hosting and services to their clients. As the country pushes towards an ‘Atmanirbhar Bharat’, India is being propelled as the R&D hub for many global organisations, especially geared towards a ‘think global, act local’ mindset. Organisations across BFSI, public sector, retail, technology, pharma, etc., are also driving the demand up for colocation data centers encouraging industry players to expand across the nation. The data center capacity of India is expected to be tripled to 1,078 MW by 2025, while currently, it stands at 375MW as per a JLL report.

That said, concerns around security and control in a colocated environment persists. Growth of data center services is also hindered by challenges around land costs, power availability, and sustainability. For example, A data center requires several technological assets such as applications, cooling systems, storage units, connecting cables, and so on to work in conjunction. It is a prerequisite to ensure that all these systems are monitored in real-time to avoid temperature fluctuations. Data centers strive to provide high uptime IT infrastructure with low PUE and work with innovative cooling technologies with increasing data storage. Alternatively, data center players generally plan an over-provision to ensure availability and avoid downtime. This can often result in significant amount of resource wastage.  Proximity to fibre stations, reliable power and water availability also restrict expansion of data services to tier I cities, driving CAPEX costs up.

To thrive in the post-pandemic world, enterprises will need to continue their spending on cloud platforms and other digital technologies. This growing adoption of the technology-driven business model means the demand for multi-tenant, hyperscale data centers will soar high, opening many opportunities for domestic and international data center operators.

DQ: What is the impact that emerging technologies in India have on data center strategies?

Sunil Gupta: The vision of a ‘Digital India’ is no more distant reality. According to the ATLAS VPN research team, India is set to reach 1 billion internet users by 2025. India’s current internet penetration stands at 50%, which means half of the country’s population in India already uses the internet. Couple this with young demographics and a deep smartphone technology penetration, our data consumption is steadily rising. It will only continue to grow in the coming years, putting the data services industry at the forefront of this technological race. Emerging technologies such as 5G, AI/ML have raised concerns around cybersecurity, forcing companies to continue upgrading legacy systems & devices, securing new technologies, setting up central security operations centers, command and control centers, training centers, etc.

AI and data-intensive applications are being tested as a solution to the data tonnage challenge with respect to the distribution and concentration of data. We can see the industry players already engaged ina race to create power-efficient data computing hardware. Another use case could be the promise of sustainable technology, helping companies regulate temperatures in the data centers – which is even more relevant in India with a tropical climate. Temperature sensors are being used to create green data center infrastructures. Wireless sensor networks are also helpful in creating a more energy-efficient cooling environment. In the coming decade, we will also see 5G emerging as a part of the deployment of edge computing, with IoT and M2M devices accounting for more than half of networked devices, thus accelerating digital innovation and a surge in data generation opening new business opportunities.

DQ: The pandemic has led to an increase in the adoption of cloud and hybrid models by Indian enterprises. How has this affected the data center industry?

Sunil Gupta: The pandemic has fast-tracked digital adoption among enterprises. Large and small organisations, deviated from the traditional workplace and adapted to work with a distributed workforce. There was an urgent need to scale up the IT infrastructure. While on-premise data center customers migrated to us, considering the essential service category that third-party data center facilities fall into and realising the cost-benefit of an MTDC. Additionally, cloud services became critical to organisations’ functioning, with employees requiring access to data and working remotely. The need for reliable and a secure IT infrastructure became of paramount importance. To address these concerns, organisations required ‘Work- from- anywhere’ services amid lockdown and physical distancing with secured connectivity and access to data and applications. Thus, cloud-based ‘Desktop-as-a-Service’ and ‘Network-as-a-Service’ became the norm.

DQ: What is your business outlook for the upcoming year? What would be your key focus areas?

Sunil Gupta: At Yotta, we believe that hyper-innovation happens at the intersection of modern technology and an infinitely scalable business ecosystem. We conceptualise, design, engineer, and operate hyper-scale data center parks and offer cloud-based solutions to support companies’ quality and capacity requirements rapidly moving towards digitisation. In terms of our company strategy, there are three pillars of growth; we will focus on:

Market segmentation: We serve both hyperscaler’s and enterprises (retail customers). Yotta Colo will provide wholescale colocation, with racks on demand, whereas our enterprise IT services will continue to offer a bouquet of managed services: private cloud, public cloud, hybrid cloud, managed security, IT management, desktop-as-a-service, managed security, storage, BCP/DR, colocation, and even GPU-as-a-service.

Investments: Given our parent company- Hiranandani Group’s vast experience over the past 35 years, Yotta Infrastructure has a competitive edge with strengths in the key pillars of the Data Center business viz. ownership of land, world-class construction, timely completion of projects and in-house power supply capabilities. In October 2020, we committed Rs 7,000 crore investment to set-up a 20-acre hyperscale datacenter park in Noida. We have also recently announced our MoU with the West Bengal government, with an investment of Rs 8,500 crore to set up logistics and hyperscale data center parks in the state. Our campuses across Chennai and Maharashtra will spread over 50 acres, offering 11 DC buildings with 60,000 racks.  Our overall blueprint over the next 5-7 years is to make 4 hyper-scale Data center parks spread across all four geographies- east, west, north, and south, catering to the needs of tech-enabled sectors including BFSI, retail, media and manufacturing, and new-age companies in the space of SaaS, IoT, Machine Learning, AI, and Big Data in every region.

Anything-as-a-Service (XaaS): Due to the rapid shift in cloud computing and spurred complexities in technology over the past couple of years, organisations are gravitating towards managed services providers to optimise and manage their entire IT infrastructure from managing CSPs to backups, disaster recovery, and security. Hence, the need to shift to a more flexible model has become inevitable for businesses. With XaaS, Yotta can provide all such services at pay-per-use model allowing organisations to buy our offerings at zero CAPEX investment and zero OPEX commitment. The pandemic and the government’s push towards digitisation have accelerated the penetration of XaaS across Indian companies and the world. A research report by IMARC suggests that the global XaaS market is expected to reach $344.3 billion by 2024, expanding at a CAGR of 24 percent during 2019-2024.

DQ: Where would you like to see the Indian data center, outsourcing and cloud industries in 5 years’ time?

Sunil Gupta: Going ahead, companies need to move beyond business continuity and remain focused on recovering from the pandemic.  This will involve digital investments that can accelerate business transformation. As the enterprises fast-track their digital transformation journey to gain competitive advantage, data centers’ role will become even more critical.  Some of the trends we can expect to unfold are:

• There will be a growing demand for robust digital infrastructure& future-ready hyperscale data centers, to transform the country into a digitally empowered society. The government’s push for data localisation and the Personal Data Protection Bill’s introduction indicates that India will need a big dose of infrastructure in data centers. We will see a big push for large data center spaces by existing and new data center players. Even the emerging use cases around AI, ML, IoT will accelerate the demand for robust digital infrastructure. With the rise in data volume and growing digital consumption, multi-tenant, hyperscale data centers will follow.
• Public Cloud will continue to ignite end-to-end digital transformation, delivering on its promise of scalability, cost-efficiency, and resiliency. To drive innovative and profitable business models, enterprises will align their business transformation efforts with adopting the public cloud platform.
• The industry will focus on operating business in an Everything-as-a-Service economy, maintaining a profitable, cost-efficient business without making long term CAPEX and OPEX commitments. With more and more services being delivered on the cloud, providing virtual access to everything and digital technologies like AI/ML and IoT playing a critical role in building these services, Everything-as-a-Service will gradually become an imperative for a truly digital-native enterprise. Consuming everything on ‘As-a-Service’ model will ensure that businesses are scaling up or down faster and delivering new and innovative services and seamless customer experiences. Simultaneously, the infrastructure providers will look to engage with as many SMEs, SOHOs, and Start-Ups as possible and convert their services into ‘As-a-Service’ model so that businesses can focus on their core expertise and handle their IT needs on a cost-efficient basis.
• Riding on the 5G and IoT wave, edge data centers are booming in India. As organisations look to keep data close to their user base, Edge data centres’ existence will proliferate. While Edge data centers are not new, we believe that these compact and self-operating data centers will support more unique use cases of digital transformation in the future.