Lebanon National Datacenter

2

Purpose of today’s Presentation:

Introduction

Heading

First Point

Second Point

Third Point

Sub-point

A

Sub-point

B

1. PPP – Eligibility

2. Overview of the NDC project and preliminary

findings

3. Considerations for a successful partnership with the

private sector

3

Pre-feasibility Study Guidelines for PPP Projects

Introduction

Identification of the

need and benefits

of the project

Preliminary

technical and

operational

analysis

Preliminary

analysis of the

financial feasibility

Project readiness

and Status

The need being fulfilled by the project and direct and indirect benefits

Contribution of the project to the government’s policy

Economic impact and socio-economic factors

Description of the technical solution and scope.

Description of the operational aspects of the project.

Description of the physical aspects

Estimation of Capex and O&M cost

Forecast of revenues with the underlying assumptions.

Preparation of a preliminary business plan

Aspects/constraints that might affect project readiness

Land availability, Level of demand , Stakeholder concerns…

Studies and relevant information

4

Need and benefits of the NDC project

5

The Lebanese Government continues to promote ICT projects in order to drive growth in the economy.

Introduction

Innovation &Entrepreneur-ship

NDC will enable

Healthcare

Government Services

Education

Teleworking Agriculture

Tourism

Public SafetyInformationSecurity

mGovernment

eParticipationeAdministartion

eHealth

Web Conferencing

Remote Access IoT

Online Education

Online Education

Smart Home

Smart Mobility

Cloud

Blockchain AI

Bi for Geo Data

Cyber Security Centralized data accessible for

All security agancies

Smart X

One essential ICT growth element is the availability of a state-of-art platform that supports new business in the sector

6

Image, Reputation

and Credibility

IT and Data Security IT Scalability

IT Infrastructure

Cost Saving

Source of Revenue

Business Continuity &

Disaster Recovery

Improved IT and data security and

governance by implementing

standardized security and data

governance policies, there is also

an opportunity to establish data

center standards for the rest of the

country

Improved business continuity and

disaster recovery capabilities to

mitigate the impact of major

natural disastrous, security and

political instability risks

An opportunity to generate extra revenues by providing

cloud offering to the public and private sectors

NDC can be Acting as Transit Hub for the region

Benefits of

NDC

Enhance the image and reputation of Lebanon and

encourage foreign businesses to invest and establish

bases in Lebanon, consequently boosting employment and

the economy in general

The NDC will provide on demand

processing power which would

reduce CAPEX expenditure for

stakeholders, this would also enable

data integration between different

government entities and would enable

the foundation to deliver government

e-Services

.

Better utilization of computing

and IT resources by implementing

virtual computing resources thus

saving cost related to IT

infrastructure and reducing the cost

of having multiple data centers for

different entities

The benefits of having the National Datacenter.

Benefits of the National Datacenter

7

Challenges and opportunities

Lack of available local state-of-the-art IT Infrastructure platform

Reputational and credibility impact due to losing government data

The high cost of restoring IT services and data

The high cost of having multiple datacenters for each government entity

Lebanon is exposed to high regional political and security risks that can cause

disruption to government operations and the consequent is loss of vital data

Private sector organizations such as banks and media companies are looking for

cloud and datacenter’s solutions which can contribute to generating considerable

revenues for the NDC

Having a reliable NDC will provide a scalable platform that will contribute to enabling

and promoting the growing e-Commerce sector in Lebanon

Leveraging on the benefits of fiber rollout in Lebanon

Objectives of the NDC Project

Gather the requirement for building Tier 3 data center

Develop a service catalogue that will be offered to this new NDC

Conduct a feasibility study to establish a PPP funding based on BOT

model

Conduct a study to explore possible locations taking into the account all

identified challenges and opportunities

Develop the most suitable technology solution to satisfy business and

government requirements

Challenges and Opportunities

Current challenges and risks are mandating the need to build a National Datacenter.

Challenges Opportunities

8

Preliminary technical and operational analysis

9

DCInitiatives

DC Roadmap

ITImplementation

DC Strategic Options

IT As-Is Analysis

DC Business Req. & Services

Prioritisation

What How

DCArchitecture

& Design

Phase 1

DC As-Is Analysis

Phase 2

DC Strategy Elaboration

Phase 3

DC Architecture Design

Phase 4

RfP Prep. & Partner Selection

Project and Stakeholder Management

Relevance of the Project with the Private Sector

hen

10

DEKOUNE

ARBENEIHJOURET AL BALOUT

33°53'37.6"N

35°38'0.1"E

33°52‘25.4"N35°40‘09.8“E

RAS BEIRUT

SITE + STRUCTURE SITE ONLY

SITE + STRUCTURE SITE ONLY

Four sites are considered as potential locations for the Lebanon national datacenter with candidates identified by Ministry of Telecommunications

Datacenter Site Evaluation

Seismic

Proximity

Space & surrounding

Connectivity

11

ICT Market Requirements and Services

DC Initiatives

DC Roadmap

ITTransformation

DC Strategic Options

IT As-Is Analysis

DC Business Req. & Services

Prioritisation

What How

DCArchitecture

& Design

12

NDC Services

Several interviews conducted with potential clients to understand their current concerns and future plans.

Interviews

13

Based on the analysis, potential clients can be grouped into categories with different priorities for datacenter and cloud services.

NDC Services

Cyber-Security: e.g. Antivirus SaaSHigh demand Medium demandLow demand No demand

Segments

Cate

go

ry 1

Cate

go

ry 2

Cate

go

ry 3

OGERO, MIC1, MIC2

Government Entities

Connect, MTV

SMEs

Start-Ups

Banks

IaaS DR/BC PaaS SaaS

BSS, Cyber-Security

Cyber-Security

Cyber-Security

Cyber-Security

Co-Location

Strong demand for Co-location, IaaS, DR/BC, and SaaS (Mainly cyber Security). Low demand for PaaS which could develop in the future.

14

Data Centre Design Considerations

DC Initiatives

DC Roadmap

ITTransformation

DC Strategic Options

IT As-Is Analysis

DC Business Req. & Services

Prioritisation

What How

DCArchitecture

& Design

15

Various design models were considered for the National Datacenter

Datacenter Building Options

Twin Core Datacenter

Systems (Compute, Data, Applications) operate in

active-active mode.

Workload is shared between the two datacenters

Mobility of virtual environments without down time

DR site as a backup to ensure data Availability in

case of regional disaster (e.g. Earthquake)

Multi-Site Datacenter

A dual core datacenter model that protects against

local and regional incidents (e.g. Outage of one site )

DR site can act as Backup and/or passive

asynchronous DC

In case of a complete disaster case in Beirut area,

the DR site outside Beirut still able to operate in

case Active-Passive model, recovery will take longer

in case of Active-DR model

One datacenter, Two separated fire containment

zones

Always having a second copy of data (e.g. during an

IT failure)

DR model protects against local incidents (e.g. Fire)

In case of a complete disaster in the local area, data

are not protected

Redundancy can be implemented as Active-Active,

Active-Passive, or Active-DR

BA C

16

Option (X): 2*(1+DR) Option (Z): 1+Passive+DROption (Y): 1+1+DR

Datacenter Building Options

Three datacenter dual-core models were evaluated for business continuity and disaster recovery.

Datacenter B

Datacenter A

Active

site for A

DR site

for A

Passive

site for A

Asynchronous Path

Datacenter B

Datacenter A

Active

site for A

DR site

for A

Active

site for B

Asynchronous Paths

DR site

for B

Datacenter B

Datacenter A

Active

site for A

DR site

for A

Active site

for B

Asynchronous Path

UpgradeableUpgradeable

~ $ 80 m ~ $ 70 m ~ $ 50 m

Capex Preliminary Estimations

17

Prioritization of key-initiatives

DC Initiatives

DC Roadmap

ITTransformation

DC Strategic Options

IT As-Is Analysis

DC Business Req. & Services

Prioritisation

What How

DCArchitecture

& Design

18

Main ICT services were put on the roadmap for the NDC based potential customer’s requirements

Datacenter Services

Prerequisites

• Tier 3 NDC build initialization

according to TIA-942-A (2012)

• NDC concept & design

• Transition scoping and planning

• Executive review and approval for

building the NDC

M0 M1 M2 M3 M4

Prerequisites

• Datacenter Build ready

• Co-Location services defined from

technical and commercial perspectives

• Contract mgmt. process ready

• Executive review and approval for

offering Co-Location services

Prerequisites

• Cloud infrastructure (IaaS) built.

• IaaS and DR/BC services and Go-to-

Market strategy defined .

• Customer migration to NDC planned.

• Service governance model ready.

• Executive review and approval for

offering IaaS and DR/BC.

Prerequisites

• Cloud services (PaaS) demand.

• Knowledge of industry verticals

acquired.

• PaaS services and Go-to-Market

strategy defined.

• Executive review and approval for

offering PaaS.

Prerequisites

• Cloud services (SaaS) demand.

• Knowledge of industry verticals

acquired.

• SaaS services and Go-to-Market

strategy defined.

• Executive review and approval for

offering SaaS.

M1 M2 M3 M4

SaaS

IaaS (incl. STaaS)

Co-Location Services

DR/BC

PaaS

Co

mp

lexity

National Datacenter

Services

Ogero, MIC1, MIC2, Ministries

Lebanon Startups, other SME‘s

Enterprises (Bank Audi,..)Customer On-boarding

SaaS Impl.

SaaS designPaaS DesignIaaS planning

PaaS Impl.IaaS, DR/BC Impl.Datacenter Building

Datacenter planning

Implementation

Decision

about PaaS

and SaaS

depends on

market

situation

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Design Considerations – Industry Best Practices

DC Initiatives

DC Roadmap

ITTransformation

DC Strategic Options

IT As-Is Analysis

DC Business Req. & Services

Prioritisation

What How

DCArchitecture

& Design

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The datacenter conceptual architecture defines the pillars of the datacenter facility and infrastructure based on TIA-942 Tier 3 standard.

Datacenter Design

Air Conditioning Power Supply

Fire Prevention and ProtectionInfrastructure and Cabling

Datacenter Building, Capacity and Floor Plan

Network room

101

102

IT/Server Room

Backup Room (Virtual/Physical

Tapes)

X

X

X

106 105 104 103

X

X

X

X

X

X

X

X

X

X

01 02 03 04 05

08

07

05

Aerial View

21

25 m²

2m 2m

1,2 2m

Day 1 0,75 OGERO MIC1 x x x St

OGERO MIC1 x x x St

Y1 OGERO MIC2 x x x St

OGERO MIC2 x x x St

Staging OGERO MIC2 x x x St

MIC1 MIC2 x x x St

MIC1 MIC2 x x x St

MIC1 MIC3 x x x St

OMSAR OMSAR x x St St m²

OMSAR OMSAR x x St St 15

OMSAR OMSAR x x St St

GS GS x x St St

GS GS x x St St

GS GS x x St St

GS GS x x St St

2m

Hot Cold

Fire wall

Rough capacity estimation of 90 Racks for NDC is done based on initial analysis, starting with 30 Racks from day 1 including Ogero, MIC1, MIC2 and governmental entities.

NDC Capacity

Server: 100% 1 RUs (high density )

Rack: H: 42 RU; W: 750 mm; D: 1200 mm

Power per Rack: Evg. 6-8 kw, Max 20kw

15 racks per row / wing (per Location)

150 cm aisles cold

150 cm between groups of 15 max

6 rows

Estimated IT rooms surface ~370m² *2

Estimated Backup room 20 m²

Estimated Network room 20 m²

Rack Footprint Assumptions

Floor Layout*

*Based on OGERO and OMSAR capacity requirements and OGERO growth estimations

One Block

22

Preliminary analysis of the financial feasibility

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The case for PPP

Funding and operating models to support the strategic way forward

Positive impactNegative Impact* We suggest a detailed analysis of the Lebanese PPP market relevant dynamics to be undertaken during feasibility

phase from the privatization high counsel as required by the PPP law.

Best Option

Margin

potential

Time-To-

Market

Saving

public

investment

budget

Strategic control

Private

PPP

Public

PPP in Lebanon*

The coherence of the option with the main objectives of the ICT sector policy.

The capacity of the private sector (contractors, consultants, financiers…) to undertake the foreseen activities.

The capacity of the public sector to implement the various types of PPP projects.

The adequacy of the country

environment to the contractual

and organizational

arrangements required to rule

the project.

Analysis

Perspectives Available Capabilities in Lebanon

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Typical success factors include

The case for PPP

* Source: The Bipartisan Policy Centre

1. Developing a clear understanding of the public purpose and benefits of the project, including clear measures

for success.

2. Including key stakeholders early in the project’s development.

3. Proactively look for opportunities to monetize assets.

4. Analyzing life-cycle costs and risk-transfer benefits in addition to the upfront cost of capital.

5. Structuring PPP agreements to encourage efficient management and protect the public interest.

6. Looking for opportunities to bundle together multiple sources of funding and financing.

7. Using transparent, competitive bidding that allows room for innovation.

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Investing in the National Datacenter

Lebanon offers competitive advantages for investors

Fiscal incentives: Exemptions from corporate income tax generated by the project which can go up to 100% exemption for 10 years

Increasing financial support to the ICT sector: with the government providing financial breaks for companies operating in the sector and

international institutions like the World Bank earmarking funds for SME start-ups

Highly skilled and multi-lingual labor force: Lebanon ranks 19th worldwide for the Quality of its higher Educational System, while it

occupies the 6th place for Math and Sciences Education. It is ranked 8th in the MENA region on the ICT Development Skills Index in

2013

Competitive salary base: the average wage of software engineers is nearly 37% lower than in the GCC and nearly 50% lower than in

selected developed economies

Booming regional market for IT services: Lebanon’s access to expanding regional markets presents significant opportunities. The

region’s ICT spending is projected to total USD 212.9 billion in 2016 accounting for 6.1% of worldwide ICT spending and is projected to

reach USD 242 billion by 2019

A thriving business environment: with the proliferation of incubators and business development centers, and the emergence of a number

of success stories of Lebanese start-ups companies turning global

Source: The Investment Development Authority of Lebanon (IDAL)-2017

26

Lebanon’s ICT sector grew at a 7% CAGR from 2014 to 2016 and is expected to grow at a 9.7% CAGR from 2016 to 2019

ICT Sector in Lebanon

Lebanese ICT market value (2016 -2019) USD Million

Source: Business Monitor International, 2016 found in IDAL 2016 Sector Review

Hardware: Sales reached USD 262.2

ICT Services: Market reached USD 134.2

Software Development: The market reached USD 40

2016

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NDC could gain a market share from the existing HW selling segment by offering IaaS services (B2C), providing an IT platform (PaaS and SaaS) enables a step into the IT- services market (B2B2C)

NDC potential Market Share

2016 2017 2018 2019 2020 2021 2022 2023

Total Market Value 436,20 478,51 524,93 543,50 596,22 654,05 717,50 787,09

Hardware 261,72 287,11 314,96 328,81 343,28 358,39 374,16 390,62

IT Services 135,22 148,34 162,73 169,89 177,36 185,17 193,31 201,82

Software 39,26 43,07 47,24 49,32 51,49 53,76 56,12 58,59

NDC Total Revenues 0,00 0,00 0,00 19,84 41,42 64,87 90,30 121,74

NDC Market Share (HW) 16,44 34,33 53,76 74,83 101,56

NDC Market Share (IT-S) 3,40 7,09 11,11 15,47 20,18

436.20 478.51524.93 543.50

596.22654.05

717.50787.09

0.000.00 0.00 19.84 41.42 64.87 90.30

121.74

2016 2017 2018 2019 2020 2021 2022 2023

Total Market Value NDC Total Market Share

Assumption:

Based on 2016 market growth

436,2 m$

NDC can gain a yearly 5% growth rate

out of the Hardware selling Market

And,

A yearly 2% growth rate out of the IT-

Services Market

for the projected time frame

All Figures in m$

Thank you

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