Inside an Amazon Web Services international data centre that stores information for business and government customers. Photo / Noah Berger
Inside an Amazon Web Services international data centre that stores information for business and government customers. Photo / Noah Berger
Technology giant Amazon Web Services (AWS) will open $7.5 billion worth of data centres in New Zealand next year – one year later than expected – the US company announced today.
The update follows its intention to invest in data centres in New Zealand in 2022over a 15-year period, at which time it said the centres would open in 2024.
The company had been tightlipped on any further details about the project until now.
It planned to build three availability zones here – which comprised at least one or more data centres – with each zone having independent power, cooling and physical security on site.
Freshly appointed New Zealand country manager Manuel Bohnet would not reveal which cities would house the centres but it was known that AWS’s data centre zones were always within 100km of each other – but property records and a map released by Westgate developer New Zealand Retail Property Group have revealed its location in Auckland’s northwest, neighbouring data centres under construction by Microsoft and DCI.
“Proximity matters,” Bohnet told the Herald at AWS’ annual re:Invent conference in Las Vegas this week.
“But, at the same time, you want to keep the distance, because you want to physically isolate to make sure that in floods and earthquakes, the regions are safe.
“And by the way, the isolation is not just for natural disasters, it’s also for human error.
“That’s how we really differentiate our region design.”
Amazon Web Services New Zealand country manager Manuel Bohnet would start the role in January, 2025 – the same year it would open a handful of data centres.
Anchor customers for its domestic data storage include Vector and One NZ, while Air New Zealand, Spark and TVNZ also use AWS services.
Vector’s digital technology general manager, Jerry Li, said it was already using AWS to run a significant portion of its digital workloads.
“With local, faster access to AWS services through the new Auckland region, we can accelerate our vision of creating a new energy future.”
Bohnet said there was data storage demand from Government too, but he could not reveal which departments and what information that included.
“One of the reasons why we are actually deploying a local region is because we are seeing an increase on the commercial side, but also on the public side, because especially a lot of public sector care about the residency of the data.”
Bohnet is currently based in Munich, Germany, as AWS’ head of industry strategy for emerging markets. He will move to New Zealand to start his new role in January.
Competition
When asked why AWS was late to opening its centres here, Bohnet said: “Yeah, I don’t think we’re late.”
“I think we have our own approach and the reason that we deploy a region with three availability zones, which is a cluster of data centres, is also needed to really meet the high bar that we set for ourselves.
“So we feel actually quite good about our timeline.”
Amazon Web Services customer One NZ is owned by Infratil, which part-owns transtasman data centre operation CDC Data Centres, which has a centre in northwest Auckland and is building another.
AWS global competitor Microsoft is also building three data centres across three locations in Auckland and north of Auckland – its centre in Auckland’s Westgate is close to completion.
Microsoft's hyperscale data centre at Westgate, northwest Auckland, due to go online later this year. Photo / Chris Keall
Microsoft announced its intention to build data centres here in May 2020 and purchased land surpassing the Overseas Investment Office’s $100 million public announcement threshold.
Microsoft cloud customers included Fonterra, the Bank of New Zealand, ASB Bank and Auckland Transport.
AWS has already spent A$9b ($9.96b) building data centres in Sydney and Melbourne, and has committed to spending an additional A$13.2b in the next three years to expand its network there.
Its latest $7.5b spend in New Zealand is on top of smaller-scale storage and computer infrastructure it set up here last year, which it called a local zone.
Energy usage
AWS’ Auckland data centres will be completely powered by renewable energy, through a circa 51 megawatt annual supply agreement it signed with Mercury last year.
The energy, to be taken from the Turitea South wind farm near Palmerston North, would exceed the power AWS needed for its initial data centres domestically.
AWS' head of global infrastructure told the Herald its data centre energy usage differed from two to 60MW annually, but the company was the largest corporate purchaser of renewable power globally.
“I feel very, very good about the offering that we have, and also the differentiating factors in terms of the sustainability story that we are telling, the high availability, the security and the overall resilience of our setup,” Bohnet said.
An example of an Amazon Web Services international data centre.
What are data centres?
Often referred to as the “cloud”, data centres are the place where public and private enterprises often store their information.
While some enterprises have servers on their premises, the demand for data has become so large, the need to offload it to external storage is growing.
Globally technology companies AWS, Microsoft Azure and Google Cloud, are the biggest providers in the storage space.
Microsoft has 60 data centre regions globally, while Google has 41 and AWS has 34.
Collectively, they had hundreds of centres.
Stay tuned for more details on Amazon’s AI strategy on Markets with Madison next week.
Madison Reidy is host and executive producer of the NZ Herald’s investment show Markets with Madison. She joined the Herald in 2022 after working in investment, and has covered business and economics for television and radio broadcasters.
Reidy travelled to re:Invent in Las Vegas courtesy of Amazon Web Services.
