Threat of AWS, Azure, Google, etc. Making a Direct Infrastructure Play into Data Centres in Australia

Hi Team,

I was hoping someone might be able to enlighten me on the following topic. I am new to researching this stock.

Valuation aside, I think NextDC looks an exceptional business in a very fast-growing industry. The growing demand for DCs is driven by continued digitization of the Australian economy and the rapid adoption of cloud computing.

However, is the entrance of major Hyperscale players such as AWS, Azure, Google Cloud etc.into Australia a potential threat rather than a strength?

At the moment, AWS uses two colocated facilities run by Fujitsu, as well data centres operated by NEXTDC, Iseek-KDC, Global Switch, and Equinix.They are mapped out by AWS as follows:SYD1: Equinix SYD3 in Alexandria.SYD4: Global Switch Ultimo.SYD5: Fujitsu Western Sydney Datacentre.SYD6: Iseek-KDC Gore Hill, Artarmon.SYD7: Fujitsu Sydney Datacentre, Homebush.SYD61: NextDC S1, Macquarie Park.

However, surely it is only a matter of time before cloud players take lower margins but higher volume and build their own data centre facilities to compete directly, rather than partner with, the major DC players such as NextDC?

Is this a valid concern? If not, why?