Is Oman the next data centre hub?

Equinix and Omantel think so - and are pouring in big bucks to prove it.
Oman, Data, Storage, Cables, Undersea, Tech, Connectivity, Telecommunications, Telco, Comms, Security, EQUINIX, Omantel, Business, Middle East, Africa, Gulf, Europe, Asia, Trade, Future, Data centre, ICT, Information

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Muscat, Oman. Photo credit: Ben Mack

When we think of data centres, we often think of gargantuan, labyrinthine complexes in typically rather cold places. After all, having a data centre somewhere like Iceland saves money on air conditioning and power costs, right?

Thus, it might seem a bit counter-intuitive to open a large data centre in Oman. After all, the Gulf nation is part of the Arabian Peninsula. But that’s exactly what US-based interconnection and data centre company Equinix and Omani telecom company Omantel plan on doing.

The two companies have announced they’ve entered into a joint venture to deliver data centre and interconnection services to customers in the Middle East through the development of a new network-dense data centre. We’re not talking about a repurposed supermarket inside which they put a few servers, either: we’re talking about an 18,600 square-foot facility that will eventually hold up to 750 cabinets. At first, though, it’ll have about 250 cabinets when it opens in mid-2019 in the coastal city of Barka, near the capital of Muscat.

The facility will allow mobile carriers, content providers, and cloud providers to store critical IT infrastructure. The companies believe that, because of Oman’s strategic location between Asia, Africa and Europe, it’s an ideal site for a large data centre.

Muscat, Oman. Photo credit: Ben Mack

“We are excited to work with Equinix on this project and accelerate how users experience cloud, content and next-gen communication,” says Omantel CEO Talal Al Mamari. “Today, data centre infrastructure sits at the heart of global ICT and enables all of us to enjoy the cloud-based apps and services we use every day. The planned IBX data centre with Equinix in Oman represents a massive step forward for Oman and the Middle Eastern ICT markets. Working on this project will allow both companies to bring together their strong assets and enable a new era of telecommunications both locally and globally. Such partnership will further enhance Oman’s competitiveness in the global digital economy and trade.”

Equinix president Eric Schwartz is equally enthusiastic. “We see significant potential for Oman as a market generally and, in particular, supporting CLS requirements as subsea cable momentum accelerates. It’s all about meeting the growing need for interconnection – private data exchange between businesses. In the digital age, companies need to reach everywhere, interconnect everyone and integrate everything, and they need to do it out at the digital edge, where commerce, population centers and digital ecosystems meet. Our joint venture with Omantel will do exactly that.”

The new data centre will benefit from connectivity to strategic cable landing stations (CLS) and undersea cables that will travel directly into the facility. Omantel also plans on investing in multiple strategic undersea cables throughout the region and world – providing customers with significant cost savings and an increase in performance and security.

Equinix president Eric Schwartz, left, and Omantel CEO Talal Al Mamari.

Under the terms of the agreement, Equinix and Omantel will both fund equity contributions of about US$10 million for the joint venture, representing 50 percent shareholding for each of them. Additional funds will be raised through debt financing assumed by the joint venture company. The shareholders’ agreement was signed on June 20 this year, and the joint venture company was established on June 26.

Equinix will handle main operations of the data centre, which will become one of more than 200 worldwide the company either operates or is involved with. Omantel is a global communications provider with cable landings and connectivity to more than 120 cities globally. It currently has investments in 20 undersea cable systems, and has six “landing stations” (where the cables come ashore) in Oman and one in France. Additionally, Omantel is an investor in the AAE-1 consortium, one of the largest and newest high-capacity connections between Asia, Africa and Europe. Omantel has also invested in multiple regional and international cables, including the Europe India Gateway (EIG), Bay of Bengal Gateway (BBG), Gulf to Africa (G2A), and Silk Route Gateway-1 (SRG-1).

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