Amazon Buys Tesco’s Dublin Shed For Cloud Services

Amazon has bought a former Tesco warehouse in Dublin, as it plans to build a new data centre to accommodate its expanding cloud computer services in Europe.

The big shed will house servers for Amazon’s rapidly-expanding European cloud business, which Amazon has spearheaded since it launched Amazon Web Services (AWS) in 2002, and which has provided online services to other websites, including (until Amazon pulled the plug on it) WikiLeaks.

More European cloud for Amazon

Amazon’s services have been growing fast in Europe and have rapidly become a major presence in Ireland. In 2008, Amazon established a data centre in Dublin to house the European availability zones for its Elastic Compute Cloud (EC2) computing operation – where users can rent virtual computers and run their own computer applications.

According to security analyst at Netcraft Colin Phipps, Amazon (the orange section of the graph, left) “makes up more than a third of all internet-facing web servers in Ireland, with three times more web servers hosted than the next largest hosting location”.

According to Phipps, there has been a sharp increase in non-Irish companies hosted in Ireland over the past two years – a result of Amazon’s expanding EC2 service. “Since October 2010, Amazon is the largest hoster of secure websites in Ireland,” he added.

Besides the Tesco warehouse, the company – best known for its online book business – has also leased two other locations in Ireland for its data centre expansion, including the Clonshaugh Industrial Estate and the Snugborough Industrial Estate in Ballycoolin.

Its cloud services expansion is also visible in the United States, where the company leased a building in northern Virginia and an additional land in Oregon.

Meanwhile, Caris and Co. analyst Sandeep Aggarwal estimated that Amazon Web Services is likely to generate as much as $900 million (£557mil) in sales this year.

Amazon’s lead in cloud services in Europe is so visible now, that analyst William Fellows of the 451 Group put it this way, at the recent Cloud Expo Europe in London: “In cloud services, if Amazon is Coke, there is no Pepsi.”

The purchase price for the 240,000 square meter building is not known.