Sparkle will shortly open its Panama Digital Gateway, a state-of-the-art data centre offering a new strategic bridge between North and South America. Mauricio Traverso, executive vice president for the Americas at Sparkle, outlines how there are opportunities across the whole of the Americas as the region’s digital potential expands.
Latin America is a region ripe for growth in the wholesale sector, as it chases to match the continued surge in demand for capacity. While the US remains a major focal point for data and communications in the Americas, digital infrastructure has also been accumulating further south over the past decade.
This is opening up more options in the region away from the typical hotspots, with forecasts that Latin America’s data centre market will see a compound annual growth rate of somewhere between 7 and 10% over the next five years, depending on which source you look at.
“We’re seeing really interesting change in the region,” says Mauricio Traverso, executive vice president for the Americas at Sparkle. “Content is now distributed throughout the Americas, moving it closer to the edge.”
He explains that locations like Sao Paulo and Fortaleza in Brazil, and Santiago in Chile have become key centres for content. Other parts of the Americas are also rapidly gaining ground, with new hives of activity springing up away from the traditional areas as carriers and major OTT players invest locally.
Regional gateway
One market viewed as having major potential is Panama, partly due to its highly strategic geographical location as a bridge between South and North America.
Sparkle is looking to take the lead there with the planned opening of its Panama Digital Gateway in June, managed by Federico Porri, who is chairman for the gateway and also executive vice president for submarine cable and landing hub engineering at Sparkle. The launch will follow final tests of the facility. Located in the capital, Panama City, it will be the company’s first owned data centre in the Americas, with an area of 5,500 square metres spread over four floors and offering up to 5MW of power.
While its opening has been delayed from 2022 by factors that have impacted many carriers, including Covid and supply-chain issues, the data centre is now set to add a fresh dimension to Latin America’s communications market.
“We’ll be able to handle traffic from South America to Panama and then distribute it to Miami or Los Angeles,” says Traverso. “It’s a new strategic point to consolidate traffic and we believe that Panama could be the next Fortaleza for the region.”
This comes amid Sparkle seeing big prospects in the rest of the Americas. The carrier now offers five diversified routes between North and South America, including the likes of Seabras-1 in the Atlantic and Curie in the Pacific. On top of that, Sparkle is reinforcing its local infrastructure, currently negotiating a new path linking Sao Paulo in Brazil with Buenos Aires in Argentina.
“With these new routes and this new infrastructure, our service is more protected all the time,” says Traverso. “We’re able to provide continuous internet access with a high level of service and availability, giving us a really good position in the market in Latin America.”
Points of promise
Enhancing its position also involves Sparkle establishing new points of presence (PoPs) that reinforce the company’s footprint in existing locations or bring it to new places of promise.
In Brazil, for example, Sparkle added a second PoP in Fortaleza in 2022, while it has also opened new ones in Salvador and Porto Alegre in recent years. In addition, the firm is exploring further possibilities for PoP locations in the interior of Brazil, such as Brasilia and Goiana.
Other markets that Traverso cites as promising for future expansion include Costa Rica, Colombia and Mexico. In Mexico, for example, Sparkle already has PoPs on the US side of the nation’s border and is planning to move into the country itself this year. The aim is to establish a location in the burgeoning data centre area of Querétaro in central Mexico first, while the company is exploring further possibilities in Monterrey to the north.
And the company sees opportunities not only in Latin America, but also in North America – with Sparkle looking at the potential for expansion in Chicago, as well as the likes of Toronto and Vancouver in Canada.
As Sparkle’s developments in the Americas improve the local infrastructure, supported by its own Seabone global IP transit service, Traverso says the company is “intercepting” the growth of the internet amid the expansion of 5G and high-capacity fibre.
At the same time, he emphasises the need for flexibility to quickly spot the next areas of demand, while meeting the challenges of the political and economic landscape in the region.
“We need to invest in a clever way by following market trends and adjusting the strategy as fast as it’s necessary to do that,” says Traverso. “We’re therefore expanding in a careful way, but I think we’ll be ready when demand increases in a particular area.”
