A private investor in Moscow is willing to build a giant data center in Russia, reported business daily Vedomosti, citing “a source close to the project.”
Dubbed ISTRADIGITAL, the project envisages the construction of a technology park near Moscow worth 132 billion rubles (about $2 billion at the current exchange rate). Among other facilities, it would include its own data center comparable in size to the current entire Russian data center market.
The proposed data center would have a capacity of 400 megawatts and occupy an area of 620,000 sq. m. to host 40,000 server racks. In terms of surface, it would be comparable to the largest data center in the world, Switch in Las Vegas, but twice as low in capacity. Three quarters of the data center’s capacity would be dedicated to cloud services. About 1,000 new jobs would be created.
The data center would be built in several stages. Upon completion of the first stage by the end of 2021, it would have 10,000 server racks installed and ready for operation. The other stages would be developed from 2022 to 2024. It is estimated that the data center could break even in five to six years.
The project proposal was jointly developed by the Aqvastroy TEK construction company and the RTDA architecture bureau. The project was initiated by private developer Vladimir Mazur, who owns a 51% stake in Aqvastroy TEK, with the remaining 49% belonging to Kostika Consulting.
The developers intend to invest $420 million in the project while $500 million is to be sought from foreign investors. The rest could be covered by loans.
The Russian Ministry of Digital Development, Communications and Mass Media has hailed the project. The authorities aim to increase Russia’s share of the global data center market from the current 0.9% to 5% by 2024. Currently, the global market is dominated by the United States, with a share of 46%; China ranks second with a share of 9%, according to the project proposal.
While the number of data centers worldwide continues to diminish (it decreased from 8.5 million in 2015 to 8.4 million in 2017, and is expected to drop to 7.2 million by 2021,) it has been growing in Russia. From 2016 to 2018, their number increased by 21% to 47,800 across the country.
Russia’s personal data legislation has been a key driver of such growth. Since September 2015, companies operating in Russia have been required to store Russian users’ or clients’ personal data on servers physically located in the country. Numerous foreign and domestic players have been concerned, including global players who tended to store their users’ data in borderless clouds (see white paper by EWDN and EY). Some companies refused or failed to comply, exposing themselves to have access to their site blocked from Russia — as was the case with LinkedIn in 2016, following two court decisions.
