US group Raxio to open a data centre in the DRC

By Kévin Poireault
Posted on Tuesday, 30 March 2021 17:06

Data Centre © GETTY

The US company Raxio Group's competitors are based in South Africa, Kenya and Nigeria. To that, the company has decided to set up shop in “secondary African markets”, though not very well established, do have promise.

And that’s three! Raxio Group announced on 3 March that it was going to open a data centre in Kinshasa. With 400 racks and a power of 1.5 MW, Raxio Kinshasa will be the very first “agnostic” data centre, also referred to as a neutral-carrier, located in the DRC.

Scheduled to open in June 2022, it will be a Tier III facility, which means that – thanks to complex electrical redundancy – it will have an availability rate of 99.982% and experience an average of only 1.6 hours of downtime per year.

Although the US group has remained silent on the amount of investment, it could be as much as $18m, according to our calculations.

“The next steps are to finalise the purchase of the land and sign construction contracts. Then it will be time to find customers,” says Robert Mullins, Raxio’s CEO.

This high-end centre is the third of its kind on the continent from this company managed by First Brick Holdings. Raxio Uganda, the very first centre and located in Kampala, was announced in 2019.

Today, “the work is complete and we are finishing installing the equipment and testing it,” says Mullins. “We have already signed up 10 customers, and it will be the country’s main connectivity hub. We are aiming for a May 1st opening.”

Work on the second – which will be located in Addis Ababa, Ethiopia – has just begun and it should be operational by the end of 2021.

A goal of 10 to 12 data centres

For each of its projects, Raxio works with local and international players: “We work with a local architect for the design upstream, based on the standard design conceived by one of our internal teams, and have chosen a local builder as well. For the centre’s equipment, we are working with one of our foreign partners. In Kinshasa, we will also work with a national partner to help us with the legislation and specifics of that market.”

There is no doubt that this offshoot of the Roha Group – a US fund that has three other African companies in its portfolio (Juniper Glass Industries in Ethiopia, African Asset Finance Companies (AAFC) and its Ethiopian subsidiary Ethio Lease as well as the pan-African company Roha Health) – intends to make its mark on the African continent.

Raxio, which received $50m from Roha in 2019, is expected to benefit from an even greater investment in the near future. “This first financial package was used to construct the first three to four data centres. Not everything has been used yet, but the amounts will increase,” says Mullins, who mentions that debt may be used as a possible lever to increase investments.

And for good reason.

Raxio Group aims to build between 10 to 12 data centres in Africa by 2023 “and the number may well increase”, he says.

Setting up shop in Africa’s “secondary markets”

Eager to become a major player in the neutral data centre sector in Africa, Raxio is adopting a different strategy to that of its competitors. “Since the beginning, most of the attention has been focused on the larger markets,” says Mullins. “Africa Data Centres is mainly active in South Africa and Kenya, others are targeting these two countries as well as Nigeria.”

The vast majority of data centres in Africa are located in these three countries, with growing interest to expand to more developed ones, such as Morocco, Egypt and Ghana. Teraco Data Environments, the owner of the largest data centre on the continent, is only located in South Africa.

“For our part, we choose markets that are in their early stages of digital transformation, whether for regulatory reasons – such as Ethiopia, where new telecoms licences have still not been awarded to operators – or because of a lack of existing internet infrastructure, like in the DRC,” says Mullins. “We believe that by moving forward quickly in these secondary markets, we can play an important role.”

Lubumbashi, a strategic crossroads

The company, therefore, plans to double its facilities in Ethiopia and Uganda, and even triple them in the DRC. “In Kinshasa, the 400 racks will be used quickly,” says Mullins. Raxio will start by building a data centre in Lubumbashi because the capital of Haut-Katanga is “well placed in terms of connectivity”, due to its proximity to Zambia, Tanzania and Angola.

A second centre will then be opened in Kinshasa, “to absorb the greater demands that we see coming in the future from a few large potential customers and to support one of the current trends, in which operators who have their own proprietary data centres outsource some of the resources they need to us.”

However, Raxio’s CEO also promises that there will be “announcements made in the coming weeks with regards to other markets.”

Rwanda and Tanzania, mentioned in 2019 as next on the list after Uganda and Ethiopia, were beaten to the punch by the DRC. This was because it “quickly became obvious to us that it was a priority” due to the “enormous market” it represents and its government’s desire to increase its very inadequate internet infrastructure. In fact, DRC’s President Félix Tshisekedi launched the “National Digital Plan – Horizon 2025” at the end of 2019.

However, Raxio still has plans for the two East African countries. “In Tanzania, we still have regulatory issues that must be resolved before we can launch,” says Mullins.

Raxio “in discussions” with Google and Facebook

He is not only counting on growing demand from mobile operators in the country but also from international content providers such as Google and Facebook, both of which are about to deliver new submarine fibre optic cables, Equiano and 2Africa, to feed the continent.

“In other parts of the world, these players [Google and Facebook] are building their own data centres, sometimes up to 10, 15 or even 20 MW. But Africa is still too young to handle infrastructures with such capacities and this will be the case for some years to come. They are therefore interested in our data centres and we are in discussions,” said Raxio’s president.

Ibrahima Ba, head of infrastructure at Facebook and creator of 2Africa, said the Menlo Park firm preferred to focus on fibre optics, both submarine and terrestrial, for the moment. “Building Facebook data centres will come later,” he said.

Although Raxio Group wants to be the pioneer of data centres in secondary African markets, they will not be alone in this field for very long. On 18 March – just seven days after Raxio Ethiopia began works – Redfox Solutions Group, another US company, announced that it was launching a data centre in Addis Ababa.

For its part, N+One, Morocco’s leading data centre company, claims to be effectively engaged in development projects on the continent, although it hasn’t specified whether the DRC is one of its target countries. The competition will indeed be tough.

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