ANALYSIS: Is there sufficient infrastructure to support Russia’s localisation law?

ANALYSIS: Is there sufficient infrastructure to support Russia’s localisation law?

Demand for data centre services in Russia is set to skyrocket in 2015 after the Russian government brought forward the deadline for compliance to its Localisation Law by a year.

The country’s telecoms market is bracing itself for major disruption as businesses scramble to locate servers within Russia’s border before the revised compliance date of September 1 2015.

The law requires companies to store the personal data of Russian citizens in databases in Russia, and looks set to place enormous pressure on Russia’s emerging data centre market.


According to Russian research firm IKS Consulting, Moscow’s co-location market is presently one 10th the size of London’s and one sixth that of Frankfurt. Russia is estimated to have 63.5 million internet users and experts in the market predict bottlenecks across the entire telecoms value chain.


Dmitry Fokin, MD at Moscow-based carrier neutral data centre provider IXcellerate, said the company had experienced a substantial increase in request for co-location space since the start of the year. 


“For us this is an opportunity. We do not have any issues complying with the law as all our information is stored in Russia. Lots of our clients, however, have currently got their IT infrastructure in Europe or elsewhere and will need to bring it into Russia,” he said.


The company has expanded its data centre space by 1000 metres in the last six months, and plans to expand it by an additional 4000 metres by the end of the year to support demand.


But Fokin expressed concerns to Capacity that the wider industry needs to complete “substantial practical work” before the deadline: “It won’t just be the data centres that create bottlenecks, it will also be equipment supply, delivery and installation,” he said. 


Should an online resource fail to store personal data on servers locally, access to it from Russia may be restricted or blocked by state regulator Roskomnadzor. Compliance to the law looks particularly challenging for businesses with a mixture of local and international data.


According to local sources, there is some hope that the law may still be modified before it comes in to force as in some instances, such as booking an air ticket, it could be practically impossible to implement. Fokin warns businesses, however, to implement action now in order to avoid potential future penalties. 


“There is certain ambiguity built in to the way the legislation is formulated but I would not take that as a positive sign. I would take that as a warning sign,” he said.


“So instead of businesses exposing themselves to risk, it is better to demonstrate they have taken measures.”

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