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‘Why data residency is critical to Nigeria’s economy’

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Raised flooring in the data centre whitespace of new MDXi facility in Lekki, Lagos. 

Expert claims country needs 72 more centres
To reduce capital flight, curb incessant security lapses; boost economy and ultimately create jobs, the Federal Government has been enjoined to ensure the localisation of data and content in-country.

Speaking on the theme: “Data Centre Operation In Nigeria: Impacts, Benefits And Challenges In a Knowledge Economy,” Data Centre operators agreed that the country has improved in data hosting, as more of such facilities are being built locally.

They revealed that a huge chunk of Nigeria’s content and data is hosted abroad, a situation they described as worrisome, arguing that the localisation of data will help leapfrog Nigeria’s infrastructure and technology readiness put at two per cent in the global eReadiness ranking.

The operators posited that for Nigeria to move up on its economic journey, the required infrastructure and technology components need to be addressed, as the relevance of infrastructure and technology to a nation’s economy cannot be overemphasized.

At the forum, organised by technology reporters, the Director of Operations, Rack Centre, Ezekiel Egboye, noted that Nigeria is still ranked very low in macro economy because it has not achieved increased infrastructure and technological readiness.

According to him, there is a co-relationship between macro-economic rating and infrastructure readiness, as well as technology readiness.
He said Nigeria currently ranks 122 in macroeconomic indices, a reflection of the country’s level of Infrastructure and Technology readiness, which stands at 2.0 and 3.0 of 10 respectively.

Egboye further noted that challenges in data centre operation are about people, processes, and control, adding that there is a need to acquire people with the right skill set, and train competent experts to man the Data Centres, while also ensuring that processes are put in place to have clear documentation and control.

In his submission, Chief Executive Officer, Medallion Communications, Ikechukwu Nnamani, observed that Nigeria needed about 72 Data Centres nationwide, at least one in each state, adding that this will not only help in economic improvement, but also in effective connectivity and quality of data services.

Nnamani strongly canvassed for the localisation of data, and urged the Federal Government to put policies in place that will ensure that local data are hosted locally; and improve on infrastructure support policies to drive down cost.

He noted that “Localisation of data is about user experience,” as the quality of data transmitted locally is improved if hosted locally. He also pointed out that there will be a reversal in payment structure, as others will be paying to Nigeria for data access, against the prevailing position where data is hosted outside the country. “The country will benefit from localisation of data because it will mean customised efficient service delivery at lower operating cost. This will also mean national economic growth.”

He said since some major global content owners, especially the Over-The-Top operators are seeking to locate their servers in Nigeria and closer to the end users for a better user experience, it is just right for the government to do the needful by ways of making strong local data hosting regulation in the country.

“Indigenous Data Centre operators are beginning to make inroad, but it would be nice for the government to understand the importance of localising data hosting for security, and safety rather than giving top secrets to foreign companies,” he said.

General Manager, MDXi, Gbenga Adegbiji, while unfolding his company’s expansion strategy, said Nigerians will have to be sensitised on the benefits of localised data hosting.

He observed that many foreign companies are bringing in their data for hosting in Nigerian Data Centres, having also realised that it is cost effective.

“Data domiciliation in the country is very important. We need to let the federal government know this. This will promote security of data, job availability, local content, among other things.”

He noted that about 60 percent of the operating cost of data centres is on power, and there should be focus on regulation and infrastructure.

“Facebook, among some other Over-The-Top (OTT) service providers are already hosting their data in Nigeria, and more are expected to join them,” he stated.

Adegbiji noted that confidence to host data in Nigeria is rising with the gradual proliferation of Tier 3 Data Centres in the country, adding that available evidence have shown that Nigeria has the capacity to deliver world class services to businesses locally and offshore.


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