Massive investments being ploughed into data centre initiatives across Nigeria, Africa’s most populous nations, will put the country’s 17.6 million Small Medium Enterprises (SMEs) on the global stage by providing them with affordable Internet and computing services, analysts have said.
Data centres are critical infrastructure that support affordable Internet services and software applications. Statistics have already shown that about 80 percents of businesses in the country are SMEs. But, majority of them are not doing particular well in terms of their contribution to the economy, particularly from a value added perspective. Analysts have identified poor access to requisite internet and computing resources as one of the drawbacks to their success.
The Ministry of Communication Technology had earlier estimated that Nigeria will require approximately 300 data centres in the coming years. A world class data warehouse is however estimated to cost about $30 million. This further means that Nigeria requires an investment of approximately N1.4 trillion for its planned 300 data centres. There are a growing number of data centre projects emerging in-country. Globacom, the second national operator, has already completed a 2,000 square feet data centre in Lagos. The telecommunications company is planning to build a 40,000 square feet data centre in Abuja, as part of its first phase of rollout. In the second phase, Globacom will build the second similar sized data centre in Ibadan.
This robust data ecosystem would allow the firm provide cloud services to a plethora of industry verticals. Also, MTN Nigeria has deployed a high-grade data centre with 500 square metres of collocation and hosting space in Lagos. By virtue of this Information Communications Technology (ICT) infrastructure, the South African company is offering cloud-based services targeted at small and medium enterprises (SMEs) in the country. Airtel also opened its 1,858 square metre Lagos data centre in 2012, to cater to its subscribers. Computer Warehouse Group (CWG), a local Information Communications Technology (ICT) firm, with annual turnover $130 million, recently launched its tier-3 data centre valued at over $10 million.
Internet Solutions West Africa, invested N1.65bn ($10.5m) over a two year period (2009 to 2011) in building two data centres in Lagos, covering a combined space of 125 sq metres. It invested N225m in upgrades and expansion of its Victoria island, Lagos, location, in 2011. “With data centres, SMEs can get access to innovative and affordable computing services that would improve productivity and efficiency”, Austin Okere, group managing director, CWG, told BusinessDay at an event. “With our own data centre, we will launch innovative services to the entrepreneur community. We are going to provide them with Enterprise Resource Planning (ERP) applications on the cloud which they would pay for on a subscription basis”, he further explained.
According to him, the ERP applications would assist these SMEs embrace transparent accounting practices. This, Okere, went on would attract local and international investments to grow their business. Data centres help create a digital economy, said Funke Opeke, chief executive officer, MainOne, at the ground breaking ceremony of the company’s $25 million tier 3 data centre in Lagos recently. “Almost every day now, we see a new online business model in the likes of the Konga.com, jumia.com, wakanow, jobberman, who have local information, services, goods here in Nigeria to serve this market”, she told reporters. These firms, according to the CEO, will require a lot of computing power to manage these huge volumes of business transaction.
“It is quite expensive to build this kind of infrastructure”, Opeke further added. “I am excited about the growth of data centres in Nigeria. These infrastructure will improve the quality and affordability of internet service. Until recently, a lot of data for multinationals were hosted outside this country. This is a positive development. This facility will reduce cost of hosting services and put our destiny in our own hands”, Ernest Ndukwe, former executive vice chairman, Nigerian Communications Commission (NCC) said at a recent industry event. These infrastructure, according to industry analysts, will give further impetus to growth of SMEs and online business in Nigeria by offering them capacity to provide innovative services cost-effectively.