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Rackspace hints at big Oz investment

Welcome, but no cure for Australia's "cloud cringe"

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Rackspace has hinted strongly at the announcement of a local data centre, with Australia/New Zealand Country Manager Mark Randall promising the company's "most significant investment" in Australia will be revealed on August 22nd.

While the cloudy company is not saying exactly what it plans to launch, the wonderfully-named Andrew Stoner, NSW Deputy Premier and Minister for Trade and Investment of NSW, will be present at the event.

In El Reg's experience, folks of that stature don't emerge to do banal things. We've seen MPs emerge to congratulate companies on merely renting a few more square metres of office space, especially when it is dubbed a regional headquarters. No matter that the back story to such facilities is often that the local MD's kids are happy at school and he or she doesn't want to move to Singapore, the supposed vote of confidence in Australia is enough to draw out some elected officials.

But Deputy Premiers don't emerge for that kind of thing. The predicted presence of Rackspace's Managing Director of Asia Pacific, Jim Fagan, suggests that regional layers of middle management are keen to get in on a more significant the grip 'n' grin.

At the very least, Rackspace will be sending a lot of people Australia's way, as the audio invitation issued to press (MP3) says the announcement will see the company "increase its focus" on Australia.

Cloud cringe

If Rackspace is indeed plopping some racks down on our shores, it should assuage Australian cloud-watchers who have long-bemoaned the absence of facilities from cloud titans. HP and Fujitsu both operate local bit barns, but don't offer the "let me sign up with my credit card and five minutes later order 10 super-servers I'll switch off next Tuesday" elasticity of leading public cloud players AWS, Microsoft and Google.

The absence of such players has sometimes been suggested to El Reg's antipodean eyrie as a crimp on local cloud adoption, for two reasons.

The first is the notion that the Patriot Act means the US government will find an excuse to gobble local business' data. Lawyers will tell you that's entirely possible, without quite ever explaining the circumstances in which an ordinary antipodean business would need to worry about this kind of thing. The Patriot Act is nonetheless held to be a brake on cloud adoption.

The second reason is that the milliseconds expended traversing cables between Australia and other data centre locations in Singapore, Hong Kong and the USA are deemed bad for business. That hasn't stopped the likes of Vodafone declaring themselves perfectly happy working in offshore clouds for very demanding applications which stream video live to thousands of Australian viewers.

Never mind the fact that numerous locals have tried to make those milliseconds less of an issue by creating hosted cloud services in Australia. And never mind that investments in data centres are also rife, meaning would-be cloud users are far from entirely deprived of on-shore clouds or millisecond-shaving options.

We therefore expect that if Rackspace does land here it will be deemed a significant event by some.

But it's not hard to feel that kind of thinking is "cloud cringe" at work.

Australia has long had a technological inferiority complex and a hankering for global technology whales to beach themselves on our shores. In the 1990s this manifested as speculation Intel would locate a silicon fabrication facility on our shores. Were Chipzilla to do so, the argument ran at the time, it would make Australia a global technology player worth paying attention to.

Since those heady days the world has happily splashed down sales offices galore here, often complete with tax-avoiding transfer pricing schemes. A few have dotted down with development centres or centres of excellence. While sounding impressive, these are also not very exciting given that the world only contains so many competent coders and some of them choose to live here.

It seems apposite to apply the same slightly cynical logic to Rackspace opening a data centre here. There simply aren't that many places in the world where one can build a world-class data centre. Australia, thanks to its political and tectonic stability is one of those.

So if Rackspace has indeed decided to throw a couple of hundred million dollars our way, it will be worth celebrating in the same way that news of new jobs and investment is always welcome. But it will also be a long way from recognition that Australia has attained an important new maturity and status in the technology world. Cloud cringe, whatever the faulty reasoning behind it, will have every reason to survive. ®

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