Vocus Communications | Australia Singapore Cable

The Centre of Australia's Internet Universe Shifts West

Posted on December 6, 2017
The Centre of Australia's Internet Universe Shifts West

In the past most of Australia's international data traffic flowed to and from the US West Coast. That's where the internet was born. The biggest online names still call the West Coast home.

Yet that's less important than it was. The focus has changed; the centre of the Internet universe has shifted. More and more Australian international data traffic now travels west to Asia.

Vocus Group traffic modelling shows a tipping point will come in around 18 months when Australia's international data traffic will be split 50:50. Half will travel west to Asia, the other half will go east to the USA. Beyond that time, Asia will start to dominate.

The internet centre of gravity is moving west, with datacentres accounting for much of the change. The world's cloud computing giants now run vast regional datacentres closer to where customers consume their services.

Asian datacentres are already important to Australia. Companies like Google, AWS and Microsoft now all operate major regional datacentres from Asia and the market is set to grow further. PWC expects to see growth of 27 percent per year over the next four to five years as more capacity comes online.

There's a clear trend towards ever larger regional data centres. Larger means greater economies of scale. Regional means, among other things, a shorter distance for data to travel. That way cloud services respond faster and users see less of a lag.

When the Australia Singapore Cable completes in July 2018, the problem of capacity scarcity and fragility on the west coast route will be solved and the latency between customers in Australia and cloud servers in Singapore will drop 30 percent compared to existing routes out of the east coast. That's an important performance boost for many mission critical cloud applications.

It's not only good for business. Australia's gamers are also more likely to connect to servers in Asia than across the Pacific. Internet Service Providers noticed gamer ping-times — the time taken for a round-trip from a device to a server — increase significantly when the Sea Me We 3 cable is cut. Shorter ping times mean a better games experience.

The shift from east to west affects more than Australia. An ever-increasing volume of New Zealand data traffic now also heads west. Vocus Group's New Zealand operation says as much as two-thirds of its traffic now travels west. Much of that goes to Australia, but an increasing proportion travels on into Asia.

Luke Mackinnon, head of Vocus International, says, “It’s all about capacity at the edge. The US historically provided the majority of our transit and peering traffic as that’s where the content was. Now the development of the over-the top companies has seen them push their infrastructure out to the edge putting them closer to the end users.

There’s been a massive regionalisation of all that infrastructure and a lot of the over-the-top serving is done locally now. Facebook and Microsoft now serve Australia out of Singapore, Google does it out of Singapore and Japan. There’s been a stagnation in the amount of traffic heading east, all the growth is to the west.”