Who Will Own the Data Centers
Meeting IT challenges is the first issue
The question of who will own the data centers is an increasingly important one in our industry. The question of ownership, of course, also impacts the footprint, power density, and cooling requirements of future data centers.
Joe Maggio, of Integrated Design Group, often talks about the importance of 3,000-5,000 square foot data centers, which can host small users. Others talk about much larger facilities. At the Telecom Exchange on Wednesday, for example, I spoke to Tim Kiser, founder and owner of Colo Atl, which houses an Interconnect facility within 55 Marietta Datacenter, which is a very large telco hub in Atlanta. Kiser likes the location because of the low energy rates, the plentiful dark fiber, and the ability the facility provides IT operations to scale in the space. The number of ultra-large data centers designed to host many IT operations seems only to grow every day.
Big or small, does it matter? Well, big does suggest that a large number of IT operations will be comfortable operating in the cloud. Small does suggest more server hugging.
And server hugging is a powerful instinct. Over the past month, I have spoken to numerous people active in IT or data centers in upstate New York. I’ve been looking for members for our 7x24 Exchange Chapter. I certainly haven’t found many large data centers ready to host IT operations and really only a few small ones. In fact, Bill Pomeroy, founder and CEO of CxTec told me that the only facility he knew of had suffered financial reversals as the market in the Buffalo didn’t seem ready to embrace the concept. In fact, most of the small operators I met at the New York Tech Summit, including banks, hospitals, school districts, and a library, seemed intent on reducing the cost of operating their self-owned facilities, while adding services. They want to virtualize as a way of reducing footprint and saving energy and money. These facilities would differ in many ways from small hosting centers, envisioned by Maggio, and they provide the ultimate in server hugging.
Reports that Apple will be building yet another large data center, this time in Reno, suggest that owning all the equipment can be a benefit. Apple, like Facebook and many other technology companies, is rapidly transitioning from leasing space as a tenant to owning and building its own giant facilities. I doubt many of Apple employees will be allowed access to the company’s data center spaces, so server hugging will be at a minimum. Perhaps Apple just wants and needs the control that ownership provides. In this regard, Apple’s giant centers may resemble some of the industry’s smaller players.
By building their own centers, Microsoft, Apple, Facebook, and Yahoo control their own fates and can design facilities to meet their own idiosyncratic needs. The larger hosting spaces must develop business plans, pricing policies, SLAs, and infrastructures that will attract and retain a host of IT enterprises. As such, these operators must make certain comprises.
Which of these facility types will prevail? Large or small? Private or shared? Well, I guess it comes down to which model best helps IT groups meet the business needs of their companies or agencies. After all, isn’t that the purpose of data centers?