Data centre. Representative image.
Credit: iStock Photo
Bengaluru: While Bengaluru is known to attract top tech companies, it may be falling short as a destination for large data centres, for reasons that seem unfixable, despite the incentives the Karnataka government offers, experts told DH.
A data centre is a physical facility that stores, runs, and distributes data for businesses. It contains computing equipment and related IT hardware.
“Data centre developers typically evaluate a range of factors including land and labour costs, availability of uninterrupted power and associated tariffs, government incentives and support infrastructure including power cables, landing stations, and fibre connectivity,” a representative of real estate consultancy Colliers said in response to DH's questions.
With high land costs due to a booming commercial market, coupled with high power costs, Bengaluru already faces a disadvantage, as per analysts. It also faces latency issues being solely dependent on fibre optic cables.
India’s data centre industry capacity is expected to reach 1.5 gigawatts (GW) by the end of 2026, with Mumbai and Chennai accounting for 81% of new capacity additions, according to a report by JLL.
To compare, Bengaluru’s colocation capacity is 81 MW with 13 assets, whereas Mumbai’s capacity is 477 MW. The city hosts 32 assets with 9 cable landings.
Connectivity setbacks
Chennai and Mumbai are prominent locations for data centers in India primarily due to their strategic geographic positioning. They both act as data exit points from India, providing excellent connectivity through submarine cables to other countries, said Subburathinam P, Chief Operating Officer, TeamLease Services.
As a result, as per Colliers, cities with access to international submarine cable systems such as Mumbai and Chennai drive close to two-thirds of the data centre market activity in India.
Kolkata is also planning to access undersea cables, which could increase its position as a preferred location, said analysts.
On the other hand, landlocked Bengaluru experiences latency issues due to slower speeds by fibre optic cables, they explained.
However, this differs from centre to centre as certain operations can survive the slower speed, an expert said. For example, Bengaluru has a lot of in-house data centers and captive data centers.
Maturity issues
Bengaluru also faces a maturity issue as it started late on data centres compared to other regions, said an analyst. For example, Hyderabad’s government policies provide support to data centres in terms of cheap power and land.
Land also becomes especially important as data centres cannot expand vertically, only horizontally. With the city’s high land costs, this poses a challenge.
Though, it is not as if Bengaluru cannot house data centres at all. The city is home to several small data centres, though there are challenges for hyperscalers. Within Bengaluru, it is the fallow land up north that takes precedence, as per analysts.
As the need for cloud computing grows and users increasingly demand faster response times and lower latency data processing, it is clear that both large-scale data centres and localised ones will expand their presence in prime areas across the country.
A testament to this is fibre path monitoring and patrolling teams and engineers, which have seen double the growth in the last decade, as per Subburathinam P.