Weekend Edition: NextDC – shovels for the AI gold-rush
episodePreviously titled “Weekend Edition: Next DC – shovels for the AI gold-rush” — renamed by the publisher on Aug 2, 2026
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Why is global AI infrastructure investment exploding and how does NextDC fit into it?
The investment we are seeing in AI is not just in Silicon Valley or with chipmakers. It requires infrastructure all over the world. And an Aussie firm publicly listed is investing heavily in data centers. They've got 17 already, with more to come in Asia, more and bigger. So let's look at the scale of it all. This week. The morning call from NAB with Phil Dobby. The weekend edition. So we know the investment in AI is huge. Microsoft alone spent almost forty billion dollars in CapEx in one quarter. Gartner reckons this year over $400 billion is going to be spent on infrastructure. And whilst the models and the data training might be predominantly done in California, the data and the processing power has to sit all around the world.
And that investment isn't just being made by the big global tech companies. They are buying the infrastructure from regional providers in many cases. And one of the biggest in our region is an Australian firm that's quickly spread its wings into Asia. Luke McKinnon is senior vice president of NextDC and their managing director for Asia. So Luke, seventeen data centers it says on your website, that's how many you've got now you're adding to that. But it's not just uh The number that counts is it's the size that is important.
That's exactly right. Look, thanks for having me. The um the data center fleet for Next DC um has been slowly growing over the last 15 years since the company's inception in 2010. Um as you point out, 17 of those across Australia, and I'm adding another two right now in Asia. Uh so we've got two projects, uh one in uh Kuala Lumpur, uh, which is a 65 megawatt facility, uh, the first Tier 4 facility. facility in peninsula Malaysia, which we're very excited about. That uh facility will open uh its first stage in uh May of this year. Right. Uh so very close. The other one's And t well tell me
about the other one in just a second. Just tell me what Tier four means. And and is the is the other one also a tier four?
Yeah, the other one is also uh Tier Four and it's in Tokyo, uh, which is also a first four Japan. Um, so uh that uh is a thirty megawatt facility right in central Tokyo, next door to Tokyo Tower. So a fantastic location, uh very much targeted at the enterprise co location. So
thirty megawatts, how does that compare? Say for example 'cause I imagine if you've been around for fifteen years, we wouldn't have been talking about artificial intelligence and a data center would be somewhere where data sat and there might have been a bit of processing, but I'm imagining now it's it's it's much more processing power, isn't it, than than disk space or at least a bit you know, at least it both of equal importance.
Yeah, absolutely. Look, firstly, just to quickly answer your question around what is Tier four. Tier four is the design standard. Um it's uh typically a a standard that's uh implemented and measured by the Uptime Institute. Um and Tier four is the highest of the uh the tiers that we can design to. Effectively what it means is that the entire data center and all of the systems that support it are are built and designed to what we call a two N uh architecture. So there
What are Tier‑4 data centres and why are they critical for AI workloads?
Duplication across every layer of the data centre. Lower tiers might rely on um you know uh reduced uh redundancy. Um uh you know, maybe N plus one um for example. Uh so yeah, it's really about the redundancy and the uptime of the uh facility. So people doing that. So people don't know so
people don't notice it in other words. So if you've g if you've got a redundancy which is less high grade, I'm putting words in your mouth, but I'm trying trying to guess. If if if you get redundancy which is lower grade, then people will notice if uh if things have gone wrong, whereas if it's Absolutely.
Yeah. Right. Yeah. Building Tier four data centers uh has been a trademark of Next D C. Um and the reason for that is that, you know, our our our go to market strategy and target audience has been enterprise and uh and government customers and that's where we sort of started our journey. Now that of course over the last fifteen years has changed a lot.
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Chapters
8 chapters
1
Why is global AI infrastructure investment exploding and how does NextDC fit into it?
0:01–2:59
2
What are Tier‑4 data centres and why are they critical for AI workloads?
2:59–6:15
3
How is NextDC’s KL1 facility in Kuala Lumpur designed to meet AI‑heavy demand?
6:15–10:26
4
What makes the TK1 Tokyo data centre a “first‑of‑its‑kind” Tier‑4 AI factory?
10:26–13:43
5
Why is power availability the biggest constraint for building AI‑ready data centres?
13:43–17:02
6
How does NextDC balance rapid AI demand with the risk of over‑building capacity?
17:02–21:05
7
Who are NextDC’s main competitors and how does its co‑location model differ?
21:05–25:32
8
What’s NextDC’s long‑term investment strategy for AI‑driven data centre growth?
25:32–28:23