Still a safe bet

Hosting solutions specialist Continent 8 Technologies sees a bright future for its business in Malta. Peter Williams, Director of Global Sales, tells iNTERGAMINGi why.

 

CONTINENT 8 has a global presence. As new i-gaming markets are opening up all the time, why does it make sense for such a major player to site any part of its business amid Malta’s mere, if bustling, 316sq.km?

 

Peter Williams is very supportive of Malta, especially in terms of running a data hosting business there. “With regulation increasing across Europe, the landscape is changing, there is no doubt. The point-of-consumption tax that the UK is to introduce is likely to be replicated in most jurisdictions, with a few exceptions.” Williams speaks quickly and knowledgably. iNTERGAMINGi imagines him to be a man who could hold court on a wide range of topics.

 

“The current position indicates that servers and other technical hardware will not be required to be located within the regulating jurisdictions, with the sole exception of France,  although this is still somewhat vague in certain cases.

 

“If the [Malta] LGA says ‘That’s fine, you can put your servers in Spain for example,’ the Spanish authorities may say you can run your activities from there. But, because you’re potentially channeling multiple geographically diverse businesses through Spain, the question is will they want a slice of the tax or VAT? It’s always a possibility and one of the continuing drivers to maintain core infrastructure that will serve multiple markets in traditional gaming jurisdictions such as Malta.

 

“It is unlikely that an operator would locate their infrastructure in Malta on purely technical or network grounds. Firstly, it is an island jurisdiction with comparatively limited network capacity when compared to some countries where the main internet exchange points for Europe are situated, such as London, Amsterdam or Dublin. It can also be more expensive to be located in an offshore location for network services relative to such locations.”

 

Have improvements been made in recent years to support this growth in demand? “Yes, there has been considerable investment made to the infrastructure in Malta in recent years. It is now far more robust and resilient than it was four or five years ago.”

 

“Although power and bandwidth costs can be more expensive, the cost of implementing and running redundant infrastructure is fairly similar no matter where you site them. Continent 8 have established highly reliable infrastructure irrespective of location which is a testament to our established and growing customer base. Historically the challenge with some offshore jurisdictions was that you had to be a little more vigilant with control and management. A power outage in for example is a less frequent occurrence in say Dublin or London. You could host there for 20 years and never have a problem.

 

“The concentration of diverse bra optic routes leaving Malta has also improved significantly since we first launched operations in 2006, but again cannot be compared to tier 1 locations purely due to the laws of economics. Dublin for example, which is Continent 8’s most recent addition global suite of data centres, is home to many of the leading global e-commerce companies so the increased demand for connectivity keeps costs down while delivering increased diversity to meet this demand.

 

“In terms of security, an island location has its challenges. Distributed Denial of Service (DDoS) attacks could potentially take down the whole island in the absence of global network diversity to mitigate such an event. To help mitigate against this, Continent 8 has established redundant network connections with multiple providers from Malta connecting to our Network Points of Presence (PoPs) in London, Paris and Milan.”

 

Continent 8 sees Malta as a reliable location for telecoms and power, although it is a little more expensive with regards to network than some of the viable alternatives due to geography and demand. “We had one interruption a year ago due to a DDoS attack but, since 2006, we’ve had no real problems and have maintained the same availability as we would in in any other location, no question.”

 

While costs are clearly a factor for Malta, Continent 8’s strategy for risk management is a clue to the jurisdiction’s continuing pull. “Ideally companies would like to run two sets of their infrastructure in Europe, a set-up known as ‘active-active’, and it’s surprising how many companies don’t have an effective disaster recovery system, if any at all.

 

“What most companies want is active-active – two instances of infrastructure in two separate locations, balancing the loads between each location. So, if one fails the other is capable of managing the entire load with no compromise on service. But then it becomes a simple question of cost, especially if you are considering a mirror infrastructure and a replication of data in real time. Active-active is ideal because you’re continuously balancing your activities between two locations.

 

“The question is one of regulation – if you’re paying taxes in different jurisdictions, how do you report what traffic was handled where?” If it is difficult to replicate the systems in this way due to regulatory complications, and hence switch between the two, it becomes difficult to implement an effective active-active, or jurisdictional disaster recovery solution that satisfies regulation. So does Continent 8 effectively have no choice but to remain in Malta?.

 

“Of course we always have choice but, we will maintain and grow our presence in Malta for the foreseeable future – and it’s purely out of choice. Although regulations are changing it is still not clearly emerging that infrastructure can be located in any jurisdiction to serve all markets without complications around incorporation and taxation. Malta satisfies this objective as a suitable and reliable location to serve multiple markets.

 

“In Malta, the infrastructure is now extremely reliable. Secondly, it is in the EU and this where Malta has an edge, with a regulatory trend emerging across the EU dictating infrastructure must be in the EU. Having a license in Malta right now means you can happily target the EU, and you can also target other markets around the world satisfying all regulatory challenges.

 

“Malta is suitable location with a good regulatory environment and good infrastructure. It’s got great people and a track record in gaming, and we’re continuing to invest in Malta. In the last few weeks we’ve deployed an additional 20 racks of infrastructure in Malta, so that’s quite significant. Continent 8 does not pretend to be the regulatory expert in this sector, but we can predict trends relatively accurately through the close working relationships we maintain with our customers.

 

“Ultimately, the island still holds a huge attraction for the gaming industry and for Continent 8 Technologies.”

 

Article appeared in iNTERGAMINGi, Malta focus, 2013

 

Posted in Press Articles