Dr. Béla Waldhauser, CEO at Telehouse Deutschland GmbH, is the representative of the “Alliance for the Strengthening of Digital Infrastructures in Germany”. On its behalf, the Borderstep Institute investigated the importance of digital infrastructures in Germany. In interview, Dr. Waldhauser presents some of the key messages of the study.
Dr. Waldhauser, the Alliance states that data centers form the “backbone of digitalization”. Why are data centers so important for digitalization?
Data centers are an essential part of the digital infrastructure. This is where data is stored, processed, shared, transmitted, and received. That’s the technical side of things. But they are also real heavyweights from an economic point of view. As our published study shows, more than eight billion Euro are invested annually in the construction, modernization, and IT of data centers in Germany. Moreover, data centers secure more than 200,000 jobs in Germany.
Speaking of the economy: what about the added value generated through data centers?
The data centers contribute to the added value in two ways: firstly, the construction, modernization, and operation create added value for providers of IT software and hardware, infrastructure equipment, and numerous service companies.
Secondly, as the core infrastructure of the Internet industry, data centers contribute to its added value. In 2015, the market had a volume of more than 70 billion Euro. In this year, more than 100 billion Euro in sales are expected. In the coming years, growth is projected at around twelve percent per year.
However, if services will mainly come from the cloud in the future, why is it important that cloud providers operate their data centers in Germany?
When we think about digitalization, aside from the technical aspects, we also talk a lot about trust. Spatial proximity and personal contacts also play a role here. This is often the case when we try to convince small to medium-sized companies of the benefits of cloud offerings. If we want to keep up with the high international pace of digitalization, I’m certain that we need a powerful data center landscape in Germany.
In international comparison, how do you see the German data center market?
From 2014 to 2017, large additional capacities were developed in German data centers. However, the share of global data center capacities in Europe and Germany is steadily declining.
The DE-CIX Internet Exchange and the German data protection law were previously regarded as locational advantages. At least the latter is losing relevance due to the European harmonization process, and there are also considerable disadvantages, such as the immensely higher electricity costs.
This is why Germany is also falling behind in European terms. Based on the share of IT investments in gross domestic product, Finland invests on average almost twice as much annually, whereas the Netherlands invests about 40 percent more than Germany.
What is your message for the political decision-makers?
To ensure the digital performance of Germany as an industry location, we need a strong data center infrastructure. However, neither the Digital Agenda nor the new coalition agreement addresses the development of data centers. As in Scandinavia, the Netherlands, and Great Britain, the German government should develop an active strategy for securing and expanding the data center infrastructures in Germany.
