Verne Global - The Big Idea

By: Lisa Rhodes - 17/10/2011

Lisa Rhodes, Vice President of Marketing and Sales, Verne Global. View more information about Lisa Rhodes

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Four years ago, we had an idea. An idea, that if it were to come to fruition, would revolutionize an industry. Historically, an idea has to present a 10% or greater advantage to get a market to move. As ideas go, it was a pretty good one but like anything that can reshape an industry, the work to make it possible couldn’t be achieved overnight. The idea was founded on the premise that we could leverage two specific industry demands have been converging in the data centre market: the rapidly increasing need for higher capacity, flexible, scalable data centre campuses; and the growing concern of the rising cost, and associated environmental impact, of traditional data centre power options.

Our idea was to tap into Iceland’s 100%, dual sourced, renewable power grid and build a high-capacity data centre campus that could service the Western European and Eastern North American markets. Located at a strategic point between the two continents, Iceland is well placed to serve as a connectivity hub between these two markets. Based on our calculations, companies that moved their servers from a comparable location in London or New York would save greater than 50% of their power costs over the length of their contracts. The best part was that the power savings of greater than 50% was just one of the advantages we were going to bring to market.

Iceland scenary

As we began to investigate, we found several obstacles that needed to be overcome in order for our idea to become viable. The first was access to the power Iceland had to offer. The power grid in Iceland was created over the last decade to serve the aluminum smelter industry and the industry was consuming a large percentage of available power. We were able to find supporters within the power industry and government that endorsed our concept and helped us create long-term, low-cost power contracts to feed our site. These contracts enable us to provide 20-year visibility into power pricing for our customers – a benefit that is unheard of in the data centre industry.

The next obstacle to overcome was connectivity. To service the high-bandwidth, high capacity needs of a large data centre industry, Iceland needed to have redundant, multi-terabit connectivity to both Europe and North America. Verne worked with local industry, network operators and the government to facilitate the deployment of additional connectivity and was part of the discussions that helped bring up the Danice cable in 2010 from Iceland to Blaabjerg, Denmark.

The final obstacle was a change in the Icelandic tax code related to VAT. The previous taxation law would levy non-reimbursable 25.5% VAT on each server of foreign customers placed in a data centre campus. This high rate of taxation would all but eliminate the compelling power position that data centres in Iceland can offer. Verne Global’s team spent a great deal of time working with local ministers and governmental agencies to modernise the tax code so that it is at parity with the rest of the European Union. With this final obstacle cleared, we were ready to move our idea into implementation.

Interest in Iceland for data centres was high. Verne Global had been promoting the location over the past several years as a way to address the high power demand with a low-cost solution, as well as the environmental impact that carbon-based power sources bring. To address this strong demand from both the U.S. and Europe, we knew we had to get to market quickly and turned to Colt Data Centre Solutions to help us bring our idea to market in just four months. Verne Global’s team was able to work with Colt to customize the solution to fit our deployment scenario and take advantage of another unique value proposition made possible by our Icelandic location – 365 days of free cooling. This means our customers won’t incur additional power costs associated with keeping their servers cool and operating making them amongst the most energy-efficient in the world.

Iceland thermal power plant

The final benefit is environmental. Many companies today have established stewardship policies in place and many governments have regulations in place to address a company’s carbon footprint. Companies are used to paying higher prices for “green” alternatives either directly from the market or through a complex carbon offset program where the impact is merely deferred. With the Verne Global kilowatt to megawatt offering with a total capacity of over 100 Megawatts of server power, there is no green premium.

Verne Global’s high capacity, dual-sourced renewable powered campus is open for your business.

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