How Does Latency Affect the Battle of the Red-Hot Canadian Data Center Markets?

Aug 8, 2018
by Josh Anderson

TORONTO, ONTARIO — What makes Canada unique? What drives demand across the various sub-markets in the Northern State? These were the central questions of Battle of the Red-Hot Canadian Markets in 2018: Comparing and Contrasting Montreal, Toronto, Calgary and Vancouver from Site Selection, Connectivity and Incentives, one of the signature panels at CapRE’s Canadian Data Center Summit held May 22nd, 2018 in Toronto. The panel had a distinct Toronto-bend to it, but the moderator made sure to think outside of the box, touching on topics such as latency requirements across Canada. Below we showcase a round-table discussion in the midst of this panel that dives deep into that topic.

Moderator Randolph W. Borron, Vice Chairman, Cushman & Wakefield: On latency, has anyone come across any demand or users out there that are agnostic to location and latency? They just want to be in the country and they don’t care here?

data center summitMike Segal, VP, International Business Development, ROOT Data Center: So we went down the path for awhile of being in Montréal to talk to a lot of the enterprise customers in Toronto. And frankly it wasn’t worth it to them, they wanted to be in Toronto still because they’re based here. Or they were looking at a disaster recovery site that they were running active-active against the primary data center, and Montréal was a bit too far. They need to be within 100 kilometers so to speak.

So, we found it tough. I think that if you’re talking to a new entrant into Canada that is setting up for data residency reasons or latency reasons, I think that 80% of demand will come within the Québec-Ontario corridor. That’s where a lot of the economic activity for our type of industry happens. And the remaining 20%, well some is in Vancouver, a bunch is in Calgary and Edmonton, and then the Maritimes has a bunch. But it’s largely Montréal and Toronto. I think that if it’s a new entry to the market for that reason, they look at pricing between the tow, and then they compare, and then they go – all else between the two being equal, for sure.

Scott Metcalfe, VP, Business Development, Ascent MCC Holdings LTD.: I think that of the 5,300 data centers in Canada, which is eight million square feet in total, there are 300 that are commercial grade and then are 5000 that are run by Fred and Barney and they go down 6 days a year. And that’s just not acceptable any longer. You know, those groups are looking at finding a solution and I think that they probably will stay in Ontario if they’ve been operating in Ontario for an extended period of time. They may look at disaster recovery solutions in inexpensive outlining markets, but I think that certainly the financial institutions that we’ve seen and the other bigger companies that are in Ontario are going to stay in Ontario.

Carleton Hall, Business Development, Iron Mountain: A lot of the Cloud storage or the regulated companies that need storage, like healthcare and stuff like that, they want to be close because of latency and things like that. But if data privacy laws come into effect they won’t want to leave the country. And I think that’ll be a good thing for Canada as well.

For more analysis on the Battle of the Red-Hot Canadian Data Center Markets, check out previous CapRE Insider Reports:

Banner Photo (L-R): Mike Segal, Vice-President for International Business Development with ROOT Data Center; Scott Metcalfe, Vice-President for Business Development at Ascent MCC Holdings LTD; Randolph W. Borron, Vice Chairman, Cushman & Wakefield; Carleton Hall, Business Development, Iron Mountain 

Sign Up For Updates: