By João Marques Lima
M&A activity, market entry by new investors, promotional initiatives by Sweden, Norway and Denmark and the emergence of eco-systems drive growth.
The Nordic region has long established itself as one of the booming markets of Europe and new research now shows that tax incentives and a green energy policy is paying off.
According to BroadGroup’s “Datacenter Nordics III” report, investment in the data centre sector in the Nordic market has reached around $3bn over the last 12 to 18 months alone.
In addition, analysts estimate that combined available power for third party facilities and hyperscales is already approaching 800MW for the region.
Third party sqm space is expected to increase by more than 26% by the end of 2018. A combination of M&A activity, market entry by new investors, promotional initiatives by Sweden, Norway and Denmark in particular to attract hyperscale investment and the emergence of eco-systems will “significantly change the landscape over the next 12-18 months”, it reads in the report.
BroadGroup said it also expects further expansion from hyperscalers due to the Nordic region’s abundance of renewable energy, and competitive energy tax, and land availability.
American hyperscalers such as Google and Facebook, have long been tenants in the region with their own large-scale sites.
Recently, Kolos has made headlines across the globe after unveiling plans to build what will be the world’s largest data centre at 1GW and 6.5 million sqf, also in the Nordic region, in Northern Norway.
However, the report points out that in the near future, not only US players are expected to harness the Nordic potential, but also Asian firms are anticipated to invest in the region.
Recently, Data Economy reported that Chinese telecommunications giant Huawei has plans to invest more solidly in the Nordic region, especially in Sweden.
This followed from the company’s CEO vision to make the company a top five global cloud provider in the coming years.
Commenting on the report, Philip Low, chairman of BroadGroup, said: “Given the outlook for available renewable energy attached to greenfield and brownfield sites across the region, with more than 5500MW, the outlook for the end of 2018 and beyond is extremely positive.
“As the Nordic markets are now much more integrated with Europe, existing colocation and content distribution hub opportunities, the emergence of Edge, fixed price contracts for renewable energy and further investment in connectivity present attractive opportunities for enterprises deploying IT assets globally.”
Datacenter Nordics III is the third annual report from BroadGroup and covers 8 countries: Denmark, Finland, Iceland, Norway, Sweden and the Baltic States of Latvia, Lithuania and Estonia who collectively own 260 third party data centre facilities.