Brexit Doesn’t Stop Microsoft from Launching UK Data Centers

UK military one of first customers using cloud services in three new locations

Yevgeniy Sverdlik

September 7, 2016

3 Min Read
Brexit Doesn’t Stop Microsoft from Launching UK Data Centers
Microsoft CEO Satya Nadella at the 2014 Microsoft Build developer conference in San Francisco (Photo by Justin Sullivan/Getty Images)

In what may be the starkest illustration of the fact that Brexit will not put the biggest companies’ data center plans in the UK on hold, Microsoft announced the launch of its first cloud regions in the UK.

Not only are these the first Microsoft data centers that support its cloud services in the UK, they are also the first data centers any cloud provider of Microsoft’s caliber has launched in the country. Amazon Web Services, the world’s biggest cloud provider, is expecting to launch its first data center in the UK by early next year, and Google, which is on a mission to prove that it can be a serious competitor to both AWS and Microsoft, hasn’t publicly voiced plans to launch a data center there.

That’s not to say that no major global cloud providers have data centers in the UK besides Microsoft. IBM SoftLayer, Rackspace, and DigitalOcean all operate cloud data centers in London.

Following the vote by UK citizens in June to leave the European Union, there was a lot of concern that the referendum could lead to fewer companies choosing to build data centers in Britain. An Amazon official addressed this concern about one week after the vote, saying the company continued to be on track to open its first UK data center next year.

The new Microsoft data centers in the UK are in three locations, according to a company spokesman:

The new Azure regions are:

  • UK West – Cardiff, Wales

  • UK South – London, England

The new Office 365 region includes data centers in the following locations:

  • London, England

  • Durham, England

While far behind AWS in terms of revenue, Microsoft has more cloud data centers around the world than any of its competitors. Including the new UK locations, its cloud services are now available from 28 regions, and six more are in the works, according to a blog post by Takeshi Numoto, the company’s corporate VP of cloud and enterprise.

The new Microsoft data centers already have their first customers, including the UK’s Ministry of Defense. The MoD is using Office 365 and Azure, the two services initially available from the new regions, with Dynamics CRM Online coming in the first half of next year.

Other customers include the country’s largest mental health trust, as well as a number of private-sector companies, such as Aston Martin, Capita, and Rosslyn Analytics.

Being able to store its data locally meant South London and Maudsley NHS Foundation Trust (the mental health organization) could use Microsoft’s cloud more, the trust’s CIO, Stephen Docherty, said in a statement.

One of the issues that raised concerns about the post-Brexit future of the UK’s data center industry was whether the country would adopt similar data privacy regulations as the UK. Along with Google and Salesforce, Microsoft has endorsed the EU-US Privacy Shield, the EU’s set of rules created to replace Safe Harbor, the framework for governing data privacy for companies that move private information between data centers on different sides of the Atlantic that was recently annulled. Britain’s exit from the EU has not been implemented at this point, and it’s unclear how different or how similar the country’s data privacy regulations will be in comparison to Privacy Shield.

Read more: Don't Let Brexit Choke Internet Traffic With EU, Operators Urge

The issues of privacy and data protection are front and center for Microsoft execs. For the last several years the company has been battling the US government in court over access to private customer emails stored in the company’s data center in Dublin, Ireland. The emails belong to a suspect in a criminal investigation, and the government feels that Microsoft is required to comply with a warrant seeking to access them.

The latest decision by an appeals court, which came in July, was in Microsoft’s favor, overturning an earlier ruling by a lower court that the company was required to hand over the emails, even though they were stored in a data center overseas.

Correction: Microsoft's new cloud regions are in three new locations in the UK, not four as this article previously said.

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