India's public cloud market to triple by 2018: Gartner

BENGALURU: With a fledgling cloud-computing market in the country, both international and Indian cloud players are ramping up capacity to meet the increasing demand and are expected to spend over Rs 10,000 crore in the next three years.

As per a recent Gartner report, the public cloud market alone in the country will treble to $1.9 billion (about Rs 12,000 crore) by 2018. It has grown to over $638 million in 2014 from $470 million in 2013.

According to Gartner, increased internet penetration and the rise of e-commerce are the main reasons for continued growth of the data centre collocation and hosting market in India.

"Early web content and e-commerce companies have used data centres in the US to address their primary requirements," said Naveen Mishra, research director at Gartner. "However, as the number of internet users has swelled in India, web technology companies have increasingly shifted their servers to data centers in India, leading to significant demand for Indian data centre service providers."

While IBM has already set up its first cloud data centre in India and is about to launch another one in a couple of months, Microsoft has pledged Rs 1,400 crore to set up three data centres in India. Local players are also investing thousands of crores to beef up their infrastructure as well as niche services capabilities to meet the rising demand.

"We expect at least Rs 10,000 crore investments in the Indian data centre market in the next three years," said Sanchit Gogia, chief analyst at Greyhound Research."About 30-35% of this spend will come from the Indian data centre providers."

Reliance, one of the largest Indian data centre companies, is building a 6,50,000 sq ft data centre in India — its tenth data centre in the country — with a combined capacity of about 1 million sq ft and an overall investment of $200 million. The company is now expanding its focus on building cloud capabilities, both internally as well as through partnerships.

"We are investing into enhancing our cloud capabilities," said Deepak Khanna, CEO, India Enterprise Business at Reliance Communications. "In the last six months, we have partnered with Hitachi to offer cloud storage, Panasonic for cloudbased security surveillance, and with Polycom for cloudbased video conferencing. We expect an additional 2022% annual growth in business with the help of these services."

Similarly, Netmagic, an NTT Communications subsidiary, is building its ninth data centre in Mumbai — the company's largest — -with 2,80,000 sq ft capacity. "We are also exploring options in the NCR region because by the time this goes live, we will be running short of space in Noida," Sharad Sanghi, CEO at Netmagic, told ET.

Instead of being threatened by the entry of larger global players, Indian data centre providers feel this will help expand the market for them. "The entry of global players in the market will increase awareness about cloud computing in India and will benefit everyone," said Sridhar Pinnapureddy , CEO of CrtlS DataCenters. "It'll also give us partnership opportunities."