Argentina faces pent-up cloud demand

Cloud demand in Argentina is rising rapidly, while the multicloud concept is firmly consolidated in the market.

More than half of companies' workloads are processed on-premise, and the rest distributed across public and private cloud and outsourcing, IDC Latin America VP of data & analytics, Diego Anesini (pictured), told BNamericas on the sidelines of telecoms company Cirion's annual event. 

“We ask organizations how they see the issue of public cloud in three or four years, if to the detriment of traditional approaches; but [traditional approaches] are far from disappearing, especially due to the particular situation of Argentina with the limitations to acquire services in US-dollars,” he said.

“If we didn't have all these restrictions, there would still be 30% or 40% in-house and the rest would go to the public and private cloud,” he added. “There is a lot of pent-up demand.”

According to an IDC survey, 26% of Argentine companies mentioned the public cloud as an investment priority during 2023, one percentage point less than across the region. Meanwhile, 25% mentioned the management of different clouds as a priority.

Cirion’s global account director Silvina Dalton told BNamericas that regulation is one reason companies keep their workloads on-premise. “There is no other alternative” in industries that handle critical data, she said.

Dalton said Cirion’s bare metals, or infrastructure-as-a-service offer, “can be a very valid alternative for clients who do not want to go to the public cloud because they are not prepared to make that move yet.”

In April, Cirion announced that it will deploy its low-latency computing solution across its markets, starting with Brazil. “Bare metal is a solution when you can't get the data out of where you are,” she added.

Cirion plans to expand its datacenter computing capacity, including two new structures in Chile and Peru. In addition, the company is analyzing opening similar datacenters in other markets in the region. Cirion is also investing in connecting clouds and datacenters. The company connects 95 datacenters in Latin America and plans to add another 10.

CLOUD DEMAND

Dalton said investments in datacenter infrastructure are being pushed by hyperscalers looking to distribute their cloud infrastructure closer to users. Cirion's new datacenters are purpose-built to support the demand of public cloud providers.

Anesini said workloads like artificial intelligence tend to be moved to the cloud, as “there is no way to process that in-house.”

He also said that most AI investment is going to customer-facing applications such as virtual assistants and recommendation systems, while the second wave of investment will focus on risk management, including fraud and cybersecurity.