Microsoft Corporation has entered the Indian data centre market significantly by acquiring 48 acres of land in Hyderabad for nearly Rs 267 crore. This acquisition is part of Microsoft’s broader strategy to expand its regional data centre business. “Microsoft has significant plans to expand its data centre business and will be developing one of the largest data centres in the region,” a source familiar with the deal told the Economic Times.

Located approximately 40 kilometres from Hyderabad’s central city, the property was purchased from land aggregator Sai Balaji Developers in Ranga Reddy district. Microsoft paid a premium for the land, indicating the strategic importance of this expansion. The tech giant’s new data centre will join its existing network in India, which includes facilities in Pune, Mumbai, and Chennai, all of which have been operational for the past five years.

The Hyderabad data centre will bolster Microsoft’s India Development Centre (IDC), already spread over 54 acres. In addition to Hyderabad, Microsoft operates similar development centres in Bengaluru and Noida. These centres are crucial in advancing Microsoft’s technological offerings, including Azure, Windows, Office, and Bing.

Over the past two years, Microsoft has also increased its presence in the flexible office space segment across India. The company’s expansion into this market reflects the growing demand for adaptable and innovative workspace solutions, aligning with global trends in remote and hybrid work models.

In January 2023, Microsoft announced its plans to expand its data centre investments in Hyderabad, with each facility expected to serve an average of 100MW of IT load. This ambitious project was discussed by Microsoft President (Asia) Ahmed Mazhari with Telangana Industries IT Minister KT Rama Rao and ITE&C Principal Secretary Jayesh Ranjan at the Microsoft cafe in Davos. The discussions underscored the strategic partnership between Microsoft and the Telangana government, aiming to bolster the region’s technological infrastructure and drive economic growth.

The Hyderabad data centre is expected to enhance Microsoft’s capacity to deliver robust cloud services and support businesses’ digital transformation initiatives across India. This investment is part of a broader trend where major tech companies ramp up their data centre capacities to meet the increasing demand for cloud services, data storage, and processing power.

Microsoft’s continued investment in India highlights the country’s importance as a key market for the company’s global operations. The development of the new data centre is expected to create numerous job opportunities and contribute to the local economy. Furthermore, building state-of-the-art facilities with modern infrastructure aligns with Microsoft’s commitment to sustainability and technological excellence.

As Microsoft deepens its roots in India, the expansion of its data centre network is set to provide significant benefits to its customers, offering enhanced reliability, security, and scalability for its digital operations. This strategic move also positions Microsoft to serve India’s growing tech ecosystem better, fostering innovation and supporting the country’s digital economy.

With this latest acquisition, Microsoft is well-positioned to continue its leadership in the data centre market, driving growth and innovation in India’s tech landscape.