The reputation of Ireland as a data hosting hub has increased as major internet-based firms set up their data centre operations here.

That’s according to a survey by European data centre firm TelecityGroup, which operates data facilities across Europe.

The survey, which was published following the official opening of Telecity Group Ireland’s new data centre in Blanchardstown Dublin, also found one in five Irish companies have spent more than half a million euro on data hosting in the past year, and Irish companies spent an average of € 160,000 on data hosting in the past year.

The survey, which questioned senior IT decision makers, found Ireland’s corporation tax rate was still the over-riding reason for locating here, with 67 per cent of those surveyed citing it as a factor. Climate came in second at 61 per cent, and the country’s proximity to Europe made up the final of the top three, at 52 per cent.

Just over 20 per cent said high-speed connections to other markets were a key reason for locating in Ireland. There has been further movement in this area in recent week, with a new transatlantic cable brought ashore in Cork in August that will link Nov Scotis, Slough in England and Cork. A seocnd cable hit shore in Mayo shortly afterwards that is designed to carry large amounts of data between Ireland and the US.

“The results of this survey are extremely interesting and reflective of our experience with customers. Ireland’s physical location and quality of transatlantic connectivity make it one of the fastest through-points for connecting to regions including the UK, US, and Europe,” said Maurice Mortell, vice president of emerging markets and country manager Ireland, TelecityGroup.

However, more than a third of respondents said they used on-premises hosting facilities rather than a data centre, compared with 29 per cent who currently use external facilities. More than a quarter said they would be moving to a a split hosted data centre and cloud solution within the next two years.

Telecity has invested more than €100 million in new capacity in Ireland in the past four years.

The company is currebntly the subject of a $3.6 billion bid by data centre giant Equinix. The deal must be approved by the European Commission, with a decision expected near the end of October.