Australian Data Centres and Submarine Cables Outlook

Hyperscale demand and new submarine cable landings drive a 15.8% capacity CAGR to 1,500 MW by 2026.

Nitish Kumar · Manager – Planning, Strategy and Market Intelligence at TPG Telecom1 December 2020Period: FY20-FY2612 min read

Last updated 10 June 2026

A$2.5bn↑

Forecast Australian data centre market revenue by 2026

1,495 MW↑

Total forecast data centre supply capacity in FY26

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Companies covered:AirTrunkEquinixGlobal SwitchNextDCDigital RealtyCanberra Data CentresMacquarie TelecomAWSMicrosoftGoogleAmazonVocusTelstraTPGSingtelOptus

Abstract

This report analyses the Australian data centre and submarine cable markets, forecasting a rapid expansion to over $2.5bn in revenue by 2026. Driven by cloud migrations and increasing international traffic, the market is shifting toward hyperscale providers, which are expected to generate 50% of total revenue and 55% of supply by 2026. The study details the competitive landscape of major players like AirTrunk and NextDC, geographic dominance in Sydney and Melbourne, and the impact of thirteen international submarine cables on regional growth.

Key Takeaways

The Australian data centre market will exceed $2.5 billion in revenue by 2026, doubling its FY20 size.
Hyperscale is the primary growth engine, with revenue forecast to grow at a 23.1% CAGR to reach $1.26 billion by 2026.
Total supply capacity will reach nearly 1,500 MW by 2026, with hyperscale accounting for 55% of the total footprint.

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Frequently Asked Questions

The market is forecast to exceed $2.5 billion in revenue by 2026, effectively doubling its FY20 size. This expansion is supported by total supply capacity reaching 1,495 MW by the end of the forecast period.

Hyperscale providers are the primary growth engine, with revenue projected to grow at a 23.1% CAGR to reach $1.26 billion by 2026. By that time, hyperscale will account for 55% of the total supply footprint and 50% of total market revenue.

While Sydney remains the dominant hub with 61% of capacity, Melbourne is emerging as a high-growth alternative with a projected 20.6% CAGR. Together, these two markets will maintain a combined capacity share of over 80%.

Capacity is increasing through three new submarine cable projects, bringing the total to thirteen international cables. However, this increased supply will result in annual industry pricing declines of 5-10%.

Australian Data Centres and Submarine Cables Outlook

Abstract

Key Takeaways

Frequently Asked Questions

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