Over the past twelve months, Pacnet has gone through a lot of changes. In October the company announced a transformation plan that would give the company a new managed-services and datacenter-centric approach and take greater advantage of their connectivity in Mainland China. And indeed they’ve been putting real money to work since then. With us today to tell us where Pacnet is at and what’s on deck is Jim Fagan, the company’s President, Managed Services.
TR: Pacnet has a series of new data center projects underway with new projects in both Singapore and China. Could you give us an update on the build-out so far?
JF: We’re looking to have the Singapore facility ready for service by the end of the year. That will open with a capacity of 600 racks, expandable to 1500. We also have the Tianjin facility, which is in the early build stages with our architects. We’re tentatively looking at having that ready for service around the end of Q1/2014 to launch that facility. And we have a new facility in ChongQing, which was launched this spring with 800 racks, expandable to 2000, and became ready for service by the end of March.
TR: Not many non-Chinese network operators get directly involved in physical assets in Mainland China, does that give you an edge?
JF: Absolutely, one of the key initiatives we laid out in October was our focus on China. Through Pacnet Business Solutions (China), our EJV in China, we actually do have IDC licenses, ISP licenses, and IP VPN licenses. That differentiates us from many of the other players, and makes it easier to get through the relationships in China.
TR: What is it like to build a data center in China, as compared to in the US or Europe? Does the system get in your way?
JF: It’s a little bit slower perhaps, but at least during the time I’ve been here I wouldn’t say there have been any major roadblocks or big hurdles. Of course, if you build a data center anywhere in the world, you will occasionally run into a hiccup that you must maneuver around.
TR: Does Pacnet have further expansion plans in mind for China?
JF: Yes, in 2014 we hope to have plans underway to enter the Shanghai area although we have nothing firm yet.
TR: Once you have these assets in place, what types of customers will you be targeting?
JF: We’re going to be targeting enterprise customers who have multiple geographic footprints within Asia and who are looking to interconnect them and to get their content or databases or web application servers closer to their customers, vendors, or partners. We certainly will take colocation customers that want to hook into our network or just use us for carrier neutral space. But where we’re going to compete is for customers who want to take advantage of our network with multiple points of presence in the region. Then we’ll look to introduce managed services at a platform level for compute and storage power where they can load on applications. The goal is create a true Asia-Pacific virtual data center.
TR: Pacnet partnered with EdgeCast for CDN services, is that something you see as an integral part of your managed services approach?
JF: That’s definitely something we’re looking to pull in. If you just look at the geography of Asia-Pacific and the amount of content that’s moving, having the ability to integrate our CDN platform into this data center strategy really rounds out our platform very well. While in the past you would make network decisions and data center decisions and then figure out how to connect them up, I think that as SDN technologies mature you’re going to see those decisions become more integrated. We want to offer facilities in key markets around Asia, have them interconnected, and then have the ability to offer a variety of different transit options like CDN, IP VPN, EPL, or IP transit. Customers should be able to choose what fits the application they are delivering.
TR: What sort of time frame should we be thinking of for these projects to bear fruit?
JF: Probably what you’ll see is the first stream of products coming out in the back half of this year. Then for the revenue play that’s absolutely a 2014 story. It’s been about 7 months since we first announced our transformation plans. These data center builds are a testament to the fact that we’re staying on our message and demonstrate the bullishness we have toward the market. We are hitting on the objectives we set out, and we’d like to show the market that we’re well on the way to transforming Pacnet.
TR: Thank you for talking with Telecom Ramblings!
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