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Datacentre set to create £20m annual benefits to Welsh economy

An independent state-of-the art data centre that opened in South Wales two years ago has forecast its services will benefit the Welsh economy by £20m annually over the next five years.

Clearstream Group  invested £2m in its new datacentre in Church Village converting a former electricity substation into a modern, highly secure  centre. The investment was supported by £75,000 from the Welsh Government and backed by a £200k loan from Finance Wales.

On a visit to the company this week Economy Minister Edwina Hart heard how the facility is supporting the growth of local businesses while also helping to retain key IT skills and revenues in the region.

The datacentre now employees 16 high-skilled IT and facilities staff, and has created further jobs in the local IT community through IT resellers in South Wales offering their own Cloud services from the centre

The Minister said:”  I am pleased to hear the investment by Clearstream, which has been supported by Welsh Government and Finance Wales, is making an important contribution to the local economy and enabling other businesses to become more competitive.

“Predictions show that optimisation of ICT by businesses could generate a further £1.5bn for the economy over the next five years and the Welsh Government is committed to helping more Welsh companies exploit these developments. We want a thriving and competitive digital economy driving innovation, productivity and growth.‘

Clearstream provides businesses with integrated server hosting and managed high speed broadband and fixed line networks, and had previously provided co-location services using third party data centre space.

As demand for these services increased with the growth of cloud computing, faster broadband speeds and increasing dependency on robust IT systems, the company decided to develop its own centre.

It relocated its hosted customer systems to Church Village providing a more cost effective and efficient service to clients. The investment has also enabled the company to reduce its operating costs and develop new services and revenue opportunities.

CEO Paul Webb said they are now providing services to businesses that were previously hosting in more expensive data centres in London, Bristol and Birmingham.

“Circle IT is a good example of a business benefiting from our data centre. The company is the second largest independent IT provider in South Wales and has been able to move its hosting provision back to Wales from England and launch a range of new services. It is currently transforming its business from IT reselling to Cloud solutions taking advantage of our new facility.

“Data centre space across the UK is increasingly expensive and in short supply. We are now one of three public data centres in South Wales and are providing businesses in Wales – and across the UK with a cost competitive service.

“We estimate our service is bringing in around £6.5m in direct and indirect spend into the Welsh economy annually. This is set to increase to £20m annually over the next five years as customers that were previously buying hosting in cities around the UK are now benefiting from a local service.”

Finance Wales Investment Executive, James Henderson helped to structure the deal. He said:

“Finance Wales’ investment has allowed Clearstream to continue expanding to take advantage of current local and national market opportunities as more businesses realise the benefits of moving to the Cloud.  Having developed its state of the art facility in South Wales, Clearstream is ahead of the game as the popularity of Cloud technology continues to grow.”