Amazon to open cloud computing hub near Calgary with promise of $4.3B investment, 950 jobs

Tech giant Amazon says it has broken ground on its second Canadian cloud-computing server hub — this one to be located in Calgary, bringing billions of dollars of investment to the region.

Amazon Web Services (AWS) says new hub will open in late 2023

An Amazon warehouse north of Calgary in Balzac, Alta., , shown in May 2020. Amazon Web Services (AWS), the company's cloud division, plans to invest $4.3 billion through 2037 to open a second Canadian cloud computing server hub in the Calgary area that will serve its growing number of customers in Western Canada. (Jeff McIntosh/The Canadian Press)

Tech giant Amazon says it has broken ground on its second Canadian cloud-computing server hub — this one to be located in the Calgary area, bringing billions of dollars of investment to the region.

Amazon Web Services (AWS), the company's cloud division, made the announcement Monday. Eric Gales, head of AWS in Canada, said the new hub will open in late 2023.

Though Gales did not say how many Amazon employees will work directly at the new server cluster, he said the project will create up to 950 direct and indirect (through construction, facility maintenance, electricity needs and other support services) jobs in Canada by 2037. Hiring for the new Calgary data centre will begin immediately.

"We are delighted to say we are opening roles today for our (Calgary) data centre operations," Gales said at a news conference in Calgary.

"When you combine our existing region in Montreal and this new region being announced today, AWS will invest $21 [billion] in Canada by 2027."

Amazon says it'll invest $4.3B by 2037

For the Calgary region specifically, Gales said, Amazon plans to invest $4.3 billion by 2037 through construction, utility costs, and buying goods and services from local businesses.

The new data centre hub will serve the growing number of AWS cloud computing customers in Western Canada, Gales said.

The company chose Calgary because it's well-placed in the region, is connected to national and international infrastructure, and offers access to renewable energy that will help allow the company to fulfil its emission reduction goals, he added.

"Calgary continues to build momentum as one of the top destinations in Canada for tech and innovation companies. Our high quality of life, low cost of doing business, and expanding tech talent base are putting Calgary on the map for companies wanting to expand or relocate," Calgary Mayor Jyoti Gondek said in a statement from Calgary Economic Development.

"We look forward to the significant investment AWS will be contributing to our economy and communities, and the opportunities it will create for Calgarians."

An Amazon spokesperson said the specific location of the hub will not be revealed as a security measure.

On Monday, Alberta Premier Jason Kenney hailed Amazon's announcement as a "game-changer for the Alberta economy."

The province has been seeking to grow its tech sector as an effort to diversify its oil and gas-based economy and address its unemployment rate, which remained higher than the national average in October at 7.6 per cent.

"For anybody who thought all the great news in Alberta's tech sector was just a temporary flash in the pan, this says no, this is real," Kenney said.

Tech companies more than doubled since 2018

According to Alberta Enterprise Corp. the number of tech companies in the province has more than doubled since 2018, from 1,238 to more than 3,000 as of the end of 2020.

In 2020, Alberta posted a record year for venture capital investment, with 51 deals representing a total of $455 million in investment — a 100 per cent increase over 2019.

There have also been a number of significant tech-related announcements specifically in Calgary in recent months, including from RBC, which plans to open an Innovation Hub in the city, bringing 300 jobs over three years.

Indian IT companies Mphasis and Infosys have also both announced plans to expand to Calgary, bringing with them a promised total of 1,500 tech jobs.

Kenney pointed to Monday's Amazon announcement as further proof that Alberta is on a roll when it comes to tech attraction.

In 2017, Calgary mounted an unsuccessful campaign to attract Amazon's "H2Q" corporate headquarters.

During his tenure, former Calgary Mayor Naheed Nenshi spoke repeatedly about the city's desire to attract a "big fish" — a company with major name recognition that would bring jobs, attract workers, and cement the city's reputation as a burgeoning tech hub.