The Australian Department of Home Affairs has signed a new five-year data center hosting deal with Canberra Data Centres.

The AU$6.3 million (US$4.8 million) contract runs from March 2021 to March 2026 as Australian Government departments and agencies continue the exodus from Global Switch facilities.

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Aussie Gov continues switch from Global Switch

Home Affairs is the latest department to leave Global Switch’s Sydney facility since Chinese steel giant Shagang became the majority shareholder of the company. The Australian Securities and Investments Commission (ASIC) and Australian Taxation Office have both signed contracts to move into CDC facilities, while the Department of Defence is undergoing a migration to a dedicated data center.

Last month the Australian Government set a new target date of July 2022 for federal agencies to leave Global Switch’s Sydney data center, having missed the previous goal of September 2020. Home Affairs boss Mike Pezzullo told a senate estimates hearing recently that the Australian Digital Health Agency and the Australian Communications and Media Authority (ACMA) were amongst those set to leave before the new target date. At the time Pezzullo said Home Affairs is in the process of finalizing a contract with an unnamed “Australian owned, Australian controlled and Australian located” data center provider.

Defence has reportedly already moved its most sensitive data out of the Switch-owned facility in Ultimo, Sydney, and relocated to a dedicated data center, but recently signed an AU$53.5 million (US$41.2 million) five-year extension to provide more time to move out the rest of the department’s data.

Shagang became the majority shareholder of Global Switch in August 2019, three years after making its first investment in the company. The Defence department made plans to make migrate from the Switch facility into its own data center in 2017 after Shagang made its first investment in Global Switch, citing a potential security risk, with the Australian government then issuing a directive requiring that agencies followed suit.

However, the consolidation could be a potential risk to the government, with the Australian Strategic Policy Institute recently warning that the “aggregation of government data in a small number of data centers in a reasonably small geographic area” could be a risk due to a potential critical failure event, lack of competition, and lack of overall oversight, despite the Government’s 2019 data center hosting strategy.