Google Cloud has announced the first cloud region in New Zealand to meet growing demand for cloud services locally.
The New Zealand cloud region will be Google Cloud’s third region in Australasia, joining Sydney and Melbourne, the company said this week, adding that it already operates 11 cloud regions in Japan and the APAC region.
Earlier, the company had said it will add cloud regions in Malaysia, Mexico, and Thailand, which will join five other previously announced regions—Berlin, Dammam, Doha, Tel Aviv, and Turin.
Google Cloud currently services its New Zealand customers from Auckland where it has a Dedicated Cloud Interconnect and a purpose-built office along with a local artificial intelligence team.
The Dedicated Cloud Interconnect, which was announced in July last year, provides direct physical connections between an organisation’s on-premises network and Google’s global network.
Google Cloud to take on AWS, Alibaba in APAC
Google and other cloud platform providers’ plans to invest in the Asia Pacific and Japan region is a “no-brainer” as the region accounts for 40% of the world’s GDP (US$30.9 trillion) and is now covered by the world’s largest free trade agreement with a market 2.5 times larger than that of the EU and the US-Canada Agreement, said Sam Higgins, principal analyst, Forrester.
In fact, APAC has the largest share, around 37%, of the world’s cloud data centers, according to a Forrester report.
Google Cloud’s three new regions in the APAC – New Zealand, Malaysia and Thailand – when operational will take the company’s total cloud region tally to 14 regions, ahead of AWS and equal footing with Alibaba in key APAC markets, said Higgins.
Across the entire APAC region, Google Cloud is expected to have 14 cloud regions by the end of the year in contrast to AWS’ 13 regions, three of which are planned in India, Australia and New Zealand.
Alibaba has 21 cloud regions but no new regions have been announced this year, said Higgins. Oracle, Microsoft and lBM are expected to have 9, 17 and 7 cloud regions in the APAC region respectively.
Tencent and Huawei on the other hand are expected to have 17 and 8 regions respectively, according to Forrester.
Data sovereignty will be a key factor in driving cloud region investments
Data sovereignty will remain a key factor in cloud provider selection for the next two years as many APAC member states, such as China and Australia, have enacted legislation protection personal data after taking a cue from the European Union.
“Large cloud providers are responding to these legislations by improving their sovereignty offerings, committing to in-country data centers and giving customers some control over where data is stored,” said Higgins, adding that cloud providers are using this as a strategy for differentiation.
Further, geopolitical tensions are expected to create opportunities for European and in-region providers, according to the Forrester report.
“Continued political and economic tensions between China, the US, and its partners in the Indo-Pacific region are affecting cloud selection,” said Higgins, adding that firms in the APAC region have to take diplomatic risk into account when selecting cloud partners.
“Taking a multicloud strategy that combines Chinese and US hyperscalers is one option; another is sticking with up-and-coming European or local options. But trade-offs include the availability of specific services, the depth of options, and the challenges of working with smaller providers,” Higgins said.
Cloud vendors continue to expand their presence
Google parent Alphabet has been investing heavily in new cloud regions as its cloud business continues to grow. Currently the company operates 34 cloud regions and 103 cloud zones globally.
As of December last year, that number stood at 29 cloud regions and 88 cloud zones globally.
Other cloud service providers are also latching on to the opoprtunity as they each continue to expand their global cloud region footprint.
Last month, Microsoft CEO Satya Nadella said the company will launch 10 new cloud regions during the next fiscal year.
In June, Oracle CEO Safra Catz said the company expects to add another six regions in fiscal 2023. In July, Oracle launched two new sovereign regions for the European Union.