A New Zealand data centre start-up by The Colocation Company has been opened last week, by the Prime Minister, John Key, picture inspecting the premises with Darryl Swann, a director of the company.

Speaking at the opening of the 800 sq/m free-cooled centre in Christchurch, Mr Swann said it was planned to more than triple the facility's size and capacity, with ample space and infrastructure available on the site.

The proposed expansion would boost the number of racks from 224 to over 700 within the next few years.

"Demand is escalating rapidly for co-located data services that cost less, yet provide fully secure and fail-safe premises," he said.

"Massive growth in fibre optic networks and internet traffic flows is driving this demand remorselessly, not just from service providers and IT integrators, but from on-line commerce and society at large."

Mr Swann said the centre's crucial point of difference was that clients housing server equipment on the site paid only for the electricity used to run and cool their equipment.

"Our unique enclosed pod design with water cooled aisles gives us the ability to manage and service enormous amounts of data at extremely low rates, up to one-third less than current norms in the industry.

Early clients for the centre include the local city council, internet service provider of the year Snap Internet, and several other large corporates.