Digital Big Boys To Set Up In NZ
Amazon Data Services New Zealand Limited (ADS NZ) Various (100%) has been given OIO approval to buy land in Auckland region to establish a cluster of data centres. “The Applicant is a New Zealand company ultimately owned by Amazon.com, Inc., a publicly traded company in the United States of America. ADS NZ owns and operates the IT infrastructure that currently underpins the Amazon Web Services (AWS) Edge location in New Zealand”.
“The Applicant proposes to establish a cluster of data centres in Auckland (called a ‘Region’). This would allow customers purchasing AWS cloud services to select one or multiple data centres in New Zealand, rather than overseas, to store or process their data and run AWS applications and services. The Region places AWS’s portfolio of services including compute, storage, database, and other services closer to end-users, ensuring ultra-low latency access to applications running locally”.
“Additionally, the Region will enable AWS customers with data residency preferences to securely store data in New Zealand. The data centres are expected to be operational in 2024. To launch and operate the Region, the Applicant will, among other activities, enter into service agreements with third party operators of facilities in New Zealand; and purchase from offshore suppliers IT equipment for installation in the facilities”.
The price is withheld in the OIO Decision but it is no secret. “Amazon Web Services (AWS) is pressing on with plans to build a giant $7.5 billion data centre in Auckland, after receiving clearance from the Overseas Investment Office. The global giant said decision the was an ‘important milestone’ and brings it a step closer to delivering world-class computing services to New Zealand”.
“‘Our investment includes building data centres, buying regional goods and services, operating utilities and facilities, and supporting wages and salaries that contribute to the local economy’, AWS Country Manager Tiffany Bloomquist said. The major investment would create 1,000 direct and indirect jobs, Bloomquist said, claiming it would add about $10.8b to the local economy over the next 15 years. The centres would provide cloud-based storage facilities of data, so it could be accessed more quickly by local organisations. Bloomquist said the facilities would help build digital skills and accelerate innovation”.
“According to research commissioned by AWS and conducted by Alpha Beta, one million more New Zealand workers or 35% of the country’s total workforce, will require digital skills training for their jobs in the next year. The nation is making tremendous strides on its digital transformation journey, and we are committed to strengthening our presence in the global digital economy by making our world-class infrastructure more easily accessible to all Kiwis” (RNZ Business, 28/4/22).
“The Auckland build will become one of 25 AWS data centre regions worldwide. The company has yet to reveal specific locations, among other details, but a wave of data centre building by Microsoft, half Infratil-owned CDC and others is currently underway in Auckland’s northwest – which offers both, land newly opened for development, and proximity to international fibre cables and NZ’s largest Internet peering exchange”.
“A rep for Amazon told the Herald that the sites would not be revealed, ‘as this is part of our secure design approach’. ….AWS is the largest of the big three in cloud computing services backed by a series of massive data centres. The Big Three also includes Microsoft and Google. All three were already expanding their cloud computing arms quickly, but the pandemic surge in working from home has turbocharged growth”.
“Last year (2020), Microsoft announced a plan to build three data centres in New Zealand and, with construction of the first under way at Westgate in northwest Auckland, is the first of the Big Three to break ground locally. Microsoft has not put a price on its build, but it did require Overseas Investment Office approval, putting it north of the agency’s $100m threshold…. while it has not yet revealed any data centre plans for NZ, Google did recently announce a local point-of-presence, with an option for larger organisations to take advantage of dedicated bandwidth on a submarine fibre link to its Aussie server farms”
“… Protecting Kiwis’ data and privacy is critically important to the Government. Onshore Cloud facilities give us stronger control of New Zealand’s data because it is held here, where our laws and protections apply,” (Digital Economy Minister David) Clark said” (Chris Keall, 23/9/21)
Amazon Is Byword For Cuthroat Capitalism
The whole sprawling empire that is Amazon has an appalling reputation. Take your pick. Start with a fanatical approach to keeping unions out of its workplaces (“How Amazon Crushes Unions”, David Streitfeld, New York Times, 16/3/21), In Watchdog 159 (April 2022), Jeremy Agar reviewed “Fulfillment: Winning And Losing In One-Click America”, by Alec MacGillis, a book about the life of Amazon’s workers and the company’s negative impact on American communities.
And the very same New Zealand government that is welcoming Amazon’s data centres here was deceived and humiliated by another branch of the Amazon empire very recently. I refer you to my article “Bludgers’ Banquet: Help Yourself, It’s On The House”, in Watchdog 158 (December 2021).
The article is about corporate welfare, and I specifically refer you to the two subsections headed “Amazon Runs ‘Rings’ Around Government”, plus “And Then, Suddenly, Amazon Was Gone”. This led to another Minister (Stuart Nash) saying that he was “gutted, very disappointed” by Amazon’s 2021 decision to walk away from filming the world’s biggest and most expensive TV series, “Lord Of The Rings”, in NZ. Amazon does what is in its own interests first, foremost and last. Let’s see if NZ fares any better with its data centres.