View from the top: Data centre industry musings

By: Bernard Geoghegan - 27/10/2011

Bernard Geoghegan was appointed EVP Colt Data Centre Services (DCS) in January 2011. He is responsible for driving Colt's focus on selling large scale data centre space to large enterprises and providers through our specialised DCS direct sales team.

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Like most business leaders at the end of the year, I have been heads down planning for 2012 and beyond. While the vast majority of time has been spent scrutinising every element of my own business, I always enjoy this time of year because it gives me more of an opportunity to stand back and take stock of what’s happening around me.

Under the cloud of economic uncertainty data centre specialists are facing challenges with regards to the high cost of power and increasing pressure to be sustainable. Add this to the growing demand for cloud applications and you can understand how data centre deployment has been forced up to the top of the CIO’s agenda and onto the CFO’s, where it is set to stay a top priority into 2012. This has brought a number of key opportunities to light for the industry, as companies look for new innovative ways to improve energy, cost efficiency and IT capacity.

So, what does the data centre industry’s year ahead look like?

Deployment on demand… it’s all about predictability

Up until recently (and still in some cases) data centre planning was complex and based on long term estimations of future capacity, but advances in the marketplace, the lack of available capital and the pressure on business to better support unplanned growth have turned this on its head. Next year, we’ll see those CIOs who tried to aggregate all their future data centre requirements together , looking for alternative solutions. They are looking for data centre solutions that better align to the business needs through flexibility, choice, quality, resilience and importantly a solution in line with the speed of business.

Colt data centre on its way to Verne Global
The Colt data centre on its way to the Verne Global facility in Iceland.

CIOs who have been burdened with the long and arduous process associated with building traditional data centres will see greater evidence that the new choices in the market are viable alternatives to what has gone before. These guys are top of their game and they’ve been waiting for innovative solutions, now though they have merging case studies and success stories that will strengthen their business cases for board approval. Into 2012 we will see more CIOs opting for solutions which will allow them to build out their data centre on-demand, matching to their exacting requirements for space, power and size and delivered within the shortest possible timeframe.

Data centres aren’t power eaters

Data centres are traditionally perceived as power eaters and environmentally damaging, but truth be told, the most efficient place for you to put your IT is into a data centre, especially as power becomes more expensive and harder to source. Not only are data centres designed to be highly efficient locations to house your IT but they also provide you with a guaranteed and consistent supply of power. This is something that is even more crucial as social media, handheld devices and effectively living a life on the Internet continues to drive up the demand for computing power and storage. The year ahead will see CIOs looking for efficient ways of managing this.

Efficiencies and regulation

Over the past year I have seen that increasingly customers have come to acknowledge the importance of efficiency and in 2012 I expect to see it built into every single Request For Proposal (RFP) as a must-have. Any company sourcing a data centre location in the future will demand that it has in-built efficiencies, that power is readily available and that there is a level of predictability as to how it will be charged.

Iceland an ambundance of hydro and geothermal power
Iceland has an abundance of hydro and geothermal power, providing 100% clean power.

That said there is still a huge amount of uncertainty about how power regulation will affect company choices and how far it will continue to be a concern. In the UK, for example, the Carbon Reduction Commitment Energy Efficiency (CRC) Scheme, introduced in 2010, aims to encourage carbon reduction in UK organisations. The way it has been legislated is a real challenge for the local data centre industry. The CRC fails to take into account all factors in assessing UK businesses’ carbon footprints. For instance, it places disproportionate focus on rewarding participants who meet pre-defined, narrow “Early Action” metrics. One of two metrics relates to the number of manually read meters replaced with Automated Meter Reading (AMR) meters. The CRC covers participants who are large energy users and in reality, have minimal manually read meters, so for example, if an organisation which has two manually read meters and replaces these with AMR ones, they would gain 50% of the total “Early Action” metric score which would not be a true measure of carbon savings and does not take into account all environmental factors like heat and water reuse.

Asia is where it’s at…

We will continue to see growth in the industry across Europe and the US but even more so across Asia. In September Google announced the opening of three new data centres in Asia in response to the regions burgeoning Internet use, with more people coming online every day compared to any other part of the world.

Russia also appears to be a growing interest region for the data centre community, as are the Nordics, with Facebook set to open its non-US data centre in Sweden. Iceland’s placement between Europe and the U.S, where we are installing a 500m2 data centre at Verne Global’s new dual-sourced renewable energy facility has been attracting widespread attention as an ideal location for data centre services benefitting from hydro and geothermal power 100% clean power.

I expect, heading into 2012, we will see an increased interest in these regions whilst growth will still be maintained in the more well known locations such as France, Germany, the UK and Netherlands.

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