 Welcome to JSA TV Europe and our live two-day event on 2023 predictions. I'm Jean-Marc Lehmann, joining me today is Warsaw based Igor Griddich, regional director for Central and Eastern Europe, the 30th. Igor, it's a pleasure speaking to you. I'm pretty sure it's very cold where you are as well, being in Warsaw. Beyond the cold weather, let's talk about a very hot topic, which is the data center sector, the data center market, especially where you are as well. The region data coverage is really on top of the headlines at the moment. Can you start by describing the current state of the market in Central and Eastern Europe and what the many events of 2022 were for the sector there? Okay. First of all, thanks for inviting me for this session. As you said, I'm currently in Warsaw. Why not really deal with these places on Central and Eastern Europe map with regards to data centers? Personally, I'm responsible for work, the business across the CE. Geographically, it means all the countries literally from Baltic area up to the Mediterranean Sea, including Israel. So Israel in the world, the world is also part of the CE region. Why I'm mentioning Israel and particularly Warsaw, where I'm based currently, is actually the business. So the hyperscale coal business with regards to data center, it's actually happening in these two markets. We do see, and me personally, I was expecting even before a faster shift from a legacy, let's call it flap markets on the West Europe side that will reach the Eastern Europe faster. But actually unfortunate case COVID fortunately started up some digitalization processes across the CE. And this was, as I can see, this was one of the major drivers to start up also more significantly data center. I would say also that capacities on the West Europe part, either they were suffering, maybe there were some challenges in terms of new electricity capacities. Or even space. So all those elements were driving a shift of the capacity to East or the Central Eastern Europe part. Beside that the Central Eastern Europe countries in some analysis saying that these guys are digital challengers. So definitely the digital infrastructure and digitalization is such in CE territory is boosting and booming last two years. And all those aspects actually driving the data center business data center industry in the region to grow. At the beginning I said Warsaw and Israel. But we do expect that some other CE countries will start booming on the data center on a bigger scale than not. It's been fascinating to watch the change that's been happening in that region because like you said, it used to be the flap markets. And now we're here so much about Warsaw, Zagreb. Stony is also becoming very big, especially with digital Stony and other digital work that goes on with the governments up there. So as you're going to 2023, what do you think will be the main developments in the region beyond Warsaw and Israel? What's going to be the big surprise within Central Eastern Europe next year? So next year you already mentioned one country. It's actually my hometown. I'm originally from Zagreb, Croatia. So yes, Zagreb, Croatia we see one of the spots definitely. Then it's hard to predict but it's also attached with the market size. So mostly Romania, Czech Republic, Greece. So I expect from those countries that we're going to see in 2023 and 2024, especially further developments of big data center projects. I wouldn't limit to those countries only. Maybe in those countries I would expect a bigger scale of business and growth. But I would expect also in other countries certain growth definitely bigger than till now. So it depends for some hyperscale customers. Those data centers in CE can be called maybe Edge. Somebody would call it Edge. It depends whom you ask. I always used to say that you ask five different people from the industry what the Edge is. And this is really true. So maybe 10 megawatt data center in Zagreb hopefully will be Edge for some of the operators. Or it can be even the core aggregation side. That really depends on the industry and the niche. That is very true because everyone has a different perception. Some people say 2 megawatts is what Edge is and below that it's even more Edgey. Above that is already hyperscale, especially above 4 megawatts hyperscale. But then if you want to ask someone else, then 10 megawatts Edge is nothing compared to the 100 megawatts. Exactly. That's the point. So I remember times just not far away. Two or three years ago when you had a 1 megawatt project it was a wow. It was a big project at least in CE region. Now there is 2-digit megawatts. This debate about Edge has been going on for a very long time. And VertiFi has been very active with it. I remember when Jordan released the study, this was in 2017-18. It was around the time that you actually opened the factory in Zagreb as well, on the outskirts of Zagreb. Yes. So I can say a few words about this. I would say it also works well because the data center industry is developing, definitely. And we do see some trends regarding the upcoming time, especially 23. So we do expect that the modular or prefab data center will grow further. And also some analysts are saying the same. So VertiFi is very skilled actually. The prefab business in Croatia started a long time ago. It started more than 15 years ago by Emerson at that time. And then we were growing and growing first. It was a mainly oil and gas industry, you know, special solutions. Then afterwards developed the four telecom sector. And then with the boom of data, when the data center need. So we switch completely to prefab. So yeah, we opened the new factory here and a half ago with the new big capacities. That factory is actually supposed to serve the IMIA territory. And it's also represents Zagreb as a site where the Zagreb site with more than 500 employees also has a big engineering center. So we have all the engineers there that are literally designing the prefab solutions all around the globe. Yeah. I remember very well visiting and there was a big within structuring site. Well, yeah. We are really proud on this. And I would say, and I can say that the business is really running well. So we grow year on year on this aspect. And we also see that, you know, before prefab solutions were mainly for territories where maybe infrastructure was missing. You know, this was somehow the go to market. But then lately we see when I say late, I mean last two, three years, we see that even the very well developed, even the western parts of Europe actually have a need for prefab data centers. Several issues. Why definitely have a scalability. You can build and then pay afterwards as you grow. You have an opportunity so you reduce the complexity of installation because majority of the job is done in the factory and you just go unsigned at PowerUp. So it's a very reliable process. So you actually take care that you have a many installation issues on site as usually it is when you build a data center. While in, let's say, control environment in a factory when you produce the prefab solution, it definitely gives you the benefit. I was going to maybe ask around supply chain because that's something that we still talk a lot about. And you're still laughing at a couple years probably. How are you kind of navigating the supply chain delays that everyone is experiencing? Yeah. So this is the topic that I would say all industries and all companies are experiencing lately. So I would say, definitely last year we did have some challenges, but I would say after a while we took control on this. So of course, we went for some maybe new suppliers, but overall I would say we're managing this supply chain issues as a company. Very good. And of course, this is something that is influencing lead times. Considering the typical lead times in our industry, I dare to say that where it stands pretty good. We have a strong and good lead times considering the environment and the where the all industries right now are small. It was interesting because halfway COVID you start opening factories around the world to kind of downgrade a little bit of the pain of the supply chain. That's also how we managed to compensate the risk to maybe open up the factories in different parts of the world and literally to mitigate the issue with the supply chain. Okay. So when you look into next year, because we are two weeks away from next year, so it's right around the corner. What would you say are the biggest opportunities in the region that you cover for both virtue and the development of the data center industry? The biggest opportunities for next year in CEE region as I already mentioned is actually the, I see the show up of big hyper skill investors or let's say big co-op investors. And some of them already existing here, especially here in Morso, but some of them are actually entering new countries. And so I really expect for next year, some of the key key investments on the southern part of the central eastern Europe. Okay. So of course we mentioned Israel, Warsaw, Zagreb, Stonia. What's the one place that no is a Romania as well. What's the one place that no is talking about you think next year was out grabbing some headlines country a city that no one is talking about. Hard to say. But if I have to judge, I believe I have to mention one country city that I believe it has a really good and strong potentials to grow. That's Bucharest. Bucharest. Yeah. It's interesting. It's coming up sometimes, not often, but it's starting to come up. So that'll be interesting to see. Yeah. And not to underestimate, definitely Greece, Athens. So it's already some developments. It's ongoing. So not, not to, definitely to mention. Yeah. Greece is quite big. I mean, already quite as a market. I think Bucharest is interesting. Connectivity towards different continents. So all these aspects are taking the part in decision. Bucharest would be interesting to see if they kind of repeat what Vienna did and build the bridges between the West and the East of Europe. Exactly. Slightly cheaper than Vienna, I assume as well. Land and power wise. But also a bit more complicated on some some other stuff, government wise. But you know, I was going to ask if people want to, to reach out and learn more about what you're doing in Verti even especially the central eastern Europe region. Where can they go to who they can reach out to? So definitely they can reach us through our social medias. They can reach also through our web page. So each of the interested party can find their for particular country can find contact. So they can easily get in contact with the word representatives or word directly and then we then we drive the things further. Okay. And last question, if you have to describe how you're feeling about next year, industry wise, one word, what words would you use? Excited. Excited. Okay. I'm really excited. I'm really seriously excited because this, this, let's say shift and introduction of big hyperscale customers into the CEE territory. This is me personally waiting for this for the last couple of years and I see final notes come. It is definitely a moment in time. And I think it's Europe and even across the world. The sector really is going through a moment in time, which is quite fascinating. It's a good industry. Yeah. Yeah. Still a small global community. You agree. Thanks so much for talking to me and thank you to our viewers for tuning into JSA TV live. Don't forget to check our social channels for more content. Until next time. Happy networking. Thank you.