Demand for data center space is on the rise. IT pros responsible for facility planning are juggling physical requirements for secure, power-abundant space with operational considerations, including the need to improve disaster recovery, deploy new applications and services, and handle increasingly large data volumes.
IN PICTURES: Fresh air cools Santa Clara data center campus
In its annual study of the North American data center market, published last month, Digital Realty Trust found a nearly unanimous need for more data center space among the 300 large enterprises surveyed. A full 92% of respondents said their companies will definitely or probably expand their data center space in 2012 -- the highest percentage in the six years that Digital Realty has conducted its survey. Among those respondents with concrete plans to expand in 2012, 38% expect to expand in three or more locations.
The scale of projects being planned is also increasing, reports Digital Realty, which is one of the largest providers of data-center real estate. Roughly half of respondents (54%) said their projects will exceed 15,000 square feet, and 49% expect their data center projects to be supported by at least 2 megawatts of electrical power (including 12% that are planning data center projects with 5 megawatts or more).
The growth isn't unexpected. Even during the IT project-crippling years that followed the financial industry meltdown in 2008, data center construction didn't dramatically slow, according to Matt Stansberry, director of content and publications at Uptime Institute. In its most recent poll of data center managers, Uptime Institute found that 80% of respondents have built a new data center or upgraded an existing facility within the past five years.
"You still need data center capacity, whether or not the economy booms," Stansberry says.
But what has changed is how data center space is being built or acquired. In the Digital Realty survey, 78% of respondents with expansion plans in the works said they intend to use a partner -- such as a wholesale data center provider or a design/build partner -- for one or all of their projects.
That's a significant shift in mindset from years past, when the largest companies tended to keep data center development in-house. "We see a lot of people looking at [colocation providers] and third-party data center service providers who wouldn't have before," Stansberry says. "These are people who traditionally have run their own data centers, but that's shifting pretty rapidly."
Even companies such as Google and Yahoo, which are known for building their own cutting-edge data centers, are supplementing in-house development with third-party providers including Equinix, which specializes in network-neutral data centers and interconnection services.
"They'll come to Equinix for the network hubs when they need low latency and access to multiple networks," says Mark Adams, chief development officer at Equinix. "We're a critical component in many of the major content companies' architecture and infrastructure."
Other reasons large enterprises are considering third-party providers include the high cost of constructing a private data center and the continuing lack of enterprise capex funds. In addition, the colocation market has matured, and enterprises are more comfortable handing over non-core, engineering-heavy construction tasks to data center providers that specialize in that kind of work. "There weren't that many colocation providers five years ago that could provide enterprise-class data centers for a financial organization," Stansberry says.
Certifications by the Uptime Institute, which offers a tier system that ranks data centers according to their expected levels of uptime and availability, show evidence of the trend. In the last couple of years, certifications for colocation and third-party providers' facilities have jumped significantly, and today account for roughly 50% of the certifications Uptime conducts, according to Stansberry.
Another trend catching on is containerized data center capacity. In the Digital Realty survey, 41% of respondents reported plans to use a containerized module as part of their expansions. Uptime Institute notes a similar uptick, though not as drastic. "About 10% of our market said that they have deployed modular, prefabricated data centers, and another 8% said they're planning to," Stansberry says.
Going wholesale
The managed data center services the enterprises are tapping "run the gamut from somebody just building a raised floor and handing you a key to the building, to something as specific as cages in a site that's fully staffed," Stansberry notes.
Vantage Data Centers, a wholesale data center provider, gets its tenants involved in the construction process early on, so they can customize attributes such as size, density, rack layout, distribution and cooling in their space.
"In wholesale data centers, you end up managing your infrastructure, you bring in your racks and stacks, and we furnish and lease the actual building, optimized for your infrastructure," says Greg Ness, chief marketing officer for Vantage. During design and construction, "there's a significant level of alignment and coordination between the enterprise and Vantage."
One of those tenants is Mozilla Corp., which recently decided to make the leap from multiple retail colocation providers to a wholesale data center model. Mozilla's plan is to consolidate its four Silicon Valley data centers (which include space in facilities owned by CoreSite, Internap and Layer 42) into a single Santa Clara, Calif., facility owned and renovated by Vantage.
The tipping point came when Mozilla realized it was consuming more than 400 kilowatts of power in its multiple data centers, recalls Matthew Zeier, director of IT operations for Mozilla.
"At some point, this model doesn't work. We're spending a lot of money on power. So the cost model started to change," Zeier says. "At this level, it started to make sense to look at moving away from a retail model and into a wholesale model."
Ann Bednarz covers IT careers, outsourcing and Internet culture for Network World. Follow Ann on Twitter at @annbednarz and check out her blog, Occupational Hazards. Her email address is abednarz@nww.com.
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