datacenterHawk

Excited to provide our latest update on 3Q 2021 data center market trends. We’ll discuss our analysis in North America, Europe, and APAC markets.

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Other videos referenced:

Bruce Lehrman HawkTalk - https://youtu.be/fm4Tl4newI0

Colocation Done Right - https://youtu.be/ZQHZOh8orTU

Bill Fathers HawkTalk - https://www.youtube.com/watch?v=q6sBIBZTj-w

Why is Data Center Connectivity Important? - https://youtu.be/jl5zqFvH_zU

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1:15 - How will new technology enable modularity when constructing new data centers?

4:05 - As technology improves and density continues to grow, will large data centers ultimately become obsolete?

6:49 - How should you plan to manage a migration to cloud project?

9:55 - When a data center tenant is paying $100 per kilowatt, what all is included in that $100?

12:31 - What’s going on in the African data center markets?

15:46 - Can you explain data center tiering levels?

18:22 - What’s the value for a data center being near a subsea cable?

20:48 - Questions around the importance of connectivity

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Josh Bosquez CTO of Armor Cloud Security got to talk about the state of data center cybersecurity in a recent HawkTalk conducted by David Liggitt from datacenterHawk.

This article is a general overview of the state of security in the industry, as well as the predictions that David and Josh talked about during the interview.

Data Center Security in the Distant and Recent Past

Josh is in a unique position to talk about cybersecurity for data centers. He cut his teeth in the Dallas telco industry in the late 1990s. Back then, the scene was all about the monitoring and empowering of data centers and creating new kinds of infrastructure automation. Later Josh and his team moved into the realm of compliance testing and automation. When the Cloud started to flourish, the focus became providing cybersecurity that could scale on demand. This is how he came to work with so many security oriented managed service providers (MSPs) in recent years.

Josh noted that back in the old days, security planning and the protection of physical space like a data center was relatively easy. You could see the cables and the hardware, and you knew how everything stacked. But in the Cloud, things are abstracted. Everything is hands off. New techniques needed to be learned in this virtual terrain. As more and more companies moved to full or hybrid Cloud, the security strategy became far more complicated. Technician training and certification needed to be ramped up, and some companies needed to entirely rewrite their cybersecurity playbook.

Data Center Security in 2021

Josh noted that as far as the most common things companies can do to protect themselves in 2021, there's no one silver bullet. But the most important thing is user education. If they don't know about ransomware, and phishing attempts, and what links are unsafe or unwise to click, about how IT support will actually contact them, and what questions they're allowed to ask... the user is a security liability. After education, the priorities are anti-virus, anti-spyware, and the like. But user education is number one in any case.

With remote work becoming a top priority, trying to protect users at home is a big challenge in some companies. They had set up a safe environment in the office, and then suddenly everyone was a telecommuter. The protection they set up in the past has to rapidly shift in order to cover this new paradigm.

He was asked to address what strategies companies providing data center services are using to protect themselves and their current customers. He said that these days, Armor standardizes around ways to gain full visibility into an environment. Every layer of the OSI model needs to be accounted for in some way, from physical data center access to network security, to access control, to hosts, and everything in between. To do this, a cybersecurity team needs to be able to see every asset out there, whether it's real or virtual. And the monitoring tools and reporting methods need to be understandable by experienced CISMs and relative laymen alike since you never know who you’re going to need to explain a security situation to get buy-in for critical systems.

A lot of organizations are leaning on security MSPs, simply because the budget for internal security has not changed over the years, while the complexity of the cybersecurity landscape has ramped up tremendously. So, they leverage the expertise of MSPs in the security compliance space even as they continue to build their own internal capabilities. Then they can use the monitoring, reporting, and automation tools that are provided by firms like Armor.

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Co-founder & Partner of Hyperco, Aleksi Taipale shares his insights on the future and growth in the data center services industry. We explore the past, present, and expectations of Hyperco as well as their strategy to expand in the Nordic region.

Be sure to check out the video above for the full conversation, but if you’re short on time, scan through our quick takeaways below.

Establishing Hyperco

In the interview, Aleksi discussed how Hyperco was conceptualized, the current conditions, and the plans for the future on our latest Hawk Talk.

The co-founders of Hyperco, Ville Vartiainen, Timo Pohjanpalo, and Aleksi started researching the data center market and found it to be an interesting niche. They found that there weren't many development-oriented investors in the Nordic region in the space, which opened the opportunity for a new entrant.

They found that the area has a good amount of potential growth as the industry becomes more mature. Due to Aleksi’s background at Nordic institutional investor NREP, he was able to raise the capital they needed to start Hyperco.

Sustainability and the plan on expanding Hyperco

Sustainability is the core of the Hyperco mission. Aleksi discussed how they are looking to use the waste energies that cause global warming and turn it into something useful by using it to run data centers.

Hyperco is working with the team that opened Google’s Finland data center and the 50-megawatt Yandex data center in Mäntsälä. This group was one of the first in the world to work in this kind of waste recovery program, which is currently warming around 80% of the 20,000 person municipality of Mäntsälä. Hyperco sees a large opportunity to bring similar arrangements to other areas and wants to mimic their success in helping their communities.

When it comes to expansion, Aleksi stated that they want to focus on the Nordic region right now, but that they are in the process of hiring people from different parts of the world in hopes of becoming multinational. They are following the market closely and are interested in the East European Region and areas close to it, where there is a lot of data center activity.

Be sure to check out the video above for the full conversation.

Interested in Hyperscale data centers? Sign up for our free hyperscale data center course:

https://lp.datacenterhawk.com/hyperscale-business-development-fundamentals

Or get a quick 15 minute demo of our platform:

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We recently sat down with JSA’s founder and CEO, Jaymie Scotto Cutaia. JSA had just joined the prestigious ranks of the 2021 Inc. 5000 List of America’s Fastest-Growing Private Companies.

In this overview, Jaymie shares her insights on marketing and brand promotion in the data center services industry, and we hear about the past, present, and future of not only JSA, but of the public relations within the sector.

The Value of Good PR

David asked who Jaymie and her team decided on what services and values that JSA would bring to the table in those early days?

She said that the company had to redefine the word 'agency'. She never liked dealing with ad agencies in the past, and so she worked hard on JSA’s image within the industry. Public relations, event planning, and marketing were just tactics used to create a core message for a company. The real deliverable was setting up clear calls to action for each campaign, and then using the best tools available, rather than taking a scattershot approach and seeing what stuck. ROI, data-driven approaches were central to their method. And it worked.

In 2008, JSA started their blog ‘Telecom News Now’, recently rebranded to The JSA Blog which now has 250,000 readers in the industry. Readers include data center operators, telecom carriers, and enterprise businesses across all sectors who were interested in the colocation (and more recently Cloud hosting) industry. Eventually, they moved into social media, videos, podcasts... pretty much adopting them as soon as those mediums emerged on the scene.

Planning and Executing a Media Strategy

David asked what advice Jaymie would give to people who are interested in starting blogs and podcasts?

She said that now is the time, as they're hotter than ever. As an example, JSA started Datamovers the year of the pandemic, and they already have 7,000 regular listeners. Because people are working differently, some remotely, others with a commute if they're essential workers, others with odd or flexible hours... you simply don't know what the best way will be for any given individual to consume your content. So providing different methods to digest information is critical. Multiple channel marketing plans are the key to success in 2021.

Step 1: Start with strategy. Ask yourself: Why do this? How will it incorporate your brand? Who are the listeners, what are their interests and pain points? Will you be solving their issues with fresh content?

Step 2: Get together the list of aspirational speakers to include, both as hosts and as guests. What's the host structure, one or multiple? What is each host bringing to the podcast... a baked-in audience? Credibility? Will they promote the show on their end? Finally, which guests will drive value to the exercise?

Step 3: Build a content calendar. Given the selected speakers, the goal is to build a consistent schedule. The time frame needs to be achievable, reliable, and realistic. Build in two to four weeks between recording and release dates, so you can be proactive in production, rather than reactive and frantic.

Step 4: Book guests, promote, record, optimize, repeat. Any issues? Contact JSA!

Interested in Hyperscale data centers? Sign up for our free hyperscale data center course:

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Find out how Ascent and Lincoln Rackhouse will combine data center facilities management operations to create a full-service, best-in-class platform focused on meeting the complex requirements and escalating demands of enterprise and hyperscale users.

If you’ve followed along with developing data center news, you’ve likely heard about the partnership between Ascent and Lincoln Rackhouse—two groups that have combined forces to change the way we look at data center facilities management operations.

We sat down with Martin Peck, Executive Vice President of Lincoln Rackhouse, and Bob Painter, President of Ascent, to hear about their journey toward partnership and their hopes for the future. But first, some background.

The History of Ascent and Lincoln Rackhouse

Founded in 1998, Ascent is a data center colocation provider located in St. Louis, Missouri. Recently, the company has grown to the Atlanta, Chicago, Dallas, and Toronto markets where they provide full life cycle support for data center facilities. Ascent’s client list includes several Fortune 500 companies, and the company's Dynamic Data Center Suite offering gives customers purpose-built, dedicated data center infrastructure.

Ascent is a one-stop-shop for all critical infrastructure needs, and works hand-in-hand with customers to provide flexible, scalable, secure, and highly available solutions to ensure their individual needs are met.

Lincoln Rackhouse is the data center division of Lincoln Property Company, and it focuses on helping clients locate, analyze, and secure data center space to lease or own. Dallas-based Lincoln Property has earned its reputation as effective, professional managers of residential and commercial properties with more than 50 years of experience in building, owning, and managing one of the largest commercial real estate firms in the United States.

Upon the acquisition of Rackhouse Group in 2010, the newly created Lincoln Rackhouse division allowed Lincoln Property to diversify its professional repertoire to include data center development. Today, Lincoln Rackhouse offers unparalleled market and industry knowledge with an unbiased approach in fulfilling technology requirements.

A Mutual Commitment to Serving Clients

Hearing Martin and Bob talk about their experience working together and planning this partnership, it’s easy to tell that their shared commitment to both their customers and their employees made this an easy match.

Ascent's services, which include data center operations and maintenance management, design, construction management, consulting, and engineering, will help customers reduce risk as they gain more control over their data center environments. Combine their experience serving customers with Lincoln Rackhouse’s data center acquisition, development, and project management activities and the companies are poised for growth.

Lincoln Rackhouse currently manages a large portfolio of data centers, with over 2 million square feet of mission critical space across the U.S. and in London. As Lincoln Rackhouse continues to acquire and develop enterprise data center facilities, each acquisition and development will benefit from the expertise that Ascent now brings—an advantage not lost on Martin Peck.

Hearing Martin and Bob talk about the partnership makes it hard not to cheer for them and their teams. They have a shared confidence in the values and strengths that both groups bring to the table, and it’s clear that the future for what they can do together is bright.

Interested in Hyperscale data centers? Sign up for our free hyperscale data center course:

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Transitioning to a digital space on short notice is never easy. But it’s a unique challenge when you’re the world’s largest organizer of data center industry events.

We were lucky enough to spend some time with George Rockett of Data Center Dynamics as he prepared to relaunch the company’s live event calendar in Q4 of 2021. We asked him about the early days of his industry experience, and how he got into the market.

Data Center Services in the Early Days

George got into the market when the space was relatively new. Back in 1997, he was working in marketing. He and his DCD co-founder Dan Scarbrough had the opportunity to sell data center space. At first they were treating it like ad space, but that didn't quite work.

So they did their research and eventually became experts on the subject. Not wanting that knowledge to go to waste, they set up a magazine called CoLo Network Europe in an effort to educate the public about the emerging colocation market. In the process, they helped create the vocabulary to describe what was going on in the industry.

By 2002 the two of them started to put on their own events, which was a massive catalyst to their overall success. DCD became synonymous with data center services conventions, and the rest was history.

Specialization in Data Center Services

We asked about the most popular topics that people have been asking about in 2021.

George said that the industry can be quite specialized, so the requests that they hear can be diverse. But in general, people want to talk about future trends.

2030 is a key year for many countries and organizations: Carbon neutral trends and other power usage concerns are forcing big changes in the workplace. But some of the technologies that will be required to achieve those goals aren't quite ready for implementation yet.

Another popular topic is density, which so often is connected to rack space and cooling capacity. But the boundaries on capacity are constantly being pushed. Which leads to the discussion of risk aversion within the industry, and the willingness to adopt some of these new technologies and techniques.

We asked how the vendor community has been adjusting. George didn’t have hard statistics, but gave a gut feeling on that subject. Massive vendors who spend hundreds of millions on R&D are adjusting just fine. But there are a huge slew of specialist companies, smaller and more focused. These dedicated suppliers grow as the industry grows, and they need to contend with the risk aversion endemic to data center services.

Colocation is spreading around the world, and regional tech variance is lessening. The solutions chosen need to scale very quickly. The complete industrialization of the data center is a threat to the small actors. If they go away then less independent, less innovative thought might be the result. The industry needs to focus on helping the best smaller companies to scale, in order to keep innovation and quality levels high.

Interested in Hyperscale data centers? Sign up for our free hyperscale data center course:

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It’s no secret that “hyperscale” has been a hot topic in the data center world for a while now, but what impact are they having on the data center industry as a whole? Let’s find out…

While a data center can support hundreds of physical servers and several thousands of virtual machines, hyperscale facilities support thousands of physical servers incorporating millions of virtual machines. So yes, hyperscale data centers are much larger in both design and capabilities, but we’re also beginning to see their influence spread beyond their own four walls.

With the continued growth of the hyperscale data center market (which, according to Global Market Insights, is expected to rise from $20 billion in 2018 to $65 billion by 2025), every major data center company has had to develop a specific strategy around how they will approach this ever-increasing sector of the market.

How Data Center Companies Handle Hyperscale

When it comes to leasing wholesale and build-to-suit data center space, hyperscale companies are controlling the demand, making them the primary customer that decides how data centers develop worldwide.

Because of the massive growth of cloud service providers like Amazon, these hyperscale companies are not able to self-build all of the capacity their growth requires. So part of the burden rests on colocation providers to help meet the increased demand. We have seen a gradual increase in the amount of capacity hyperscale companies lease vs. build in recent years. In order for colocation providers to capture some of this demand, they need to have a strategy for how to approach land acquisition, development, and a sustainable path to growth.

An example of this can be seen on Facebook’s Oregon campus. Originally, they had three 330,000-square-foot data center buildings. But recent improvements to the campus have created room for up to seven 450,000-square-foot buildings. As for creating a path for growth, new campuses being built by data center REITs are being designed with long-term roadmaps to have 350 MWs of capacity or more (up from the typical 50-100 MW).

How Hyperscale Affects Data Center Design

In the past, data center companies would build a facility that they felt would attract the most number of customers. This led to over-engineered facilities that were not cost-effective. With many “multi-tenant” facilities now going to a single tenant on a pre-lease basis, companies are designing building components like generator redundancy to a single customers' requirements. This ultimately brings the cost of the development down as it removes the guesswork.

Additionally, while economics is still a significant factor in site selection, both the cost of the lease and the cost of power, hyperscale companies have become more focused on the scalability factor. Instead of only asking how much this capacity will cost today, hyperscale developers must also think about how much it will cost to increase the power usage in the future.

Hyperscale data centers consume massive amounts of power, often creating a large carbon footprint. To offset this issue, we see large hyperscale companies developing their own wind farms and solar energy plants as a means of supporting their operation. Furthermore, indirect evaporative or direct evaporative cooling techniques are used to handle water conservation.

These are just some of the questions raised by the development of hyperscale data centers around the world. The impact of hyperscale growth will only continue to increase. In the meantime, stay tuned for the next article in our hyperscale series where we’ll discuss the future of hyperscale data centers.

Nigel Clarkson, CEO of Stratus Data Centres, shares how the growing competition in the US markets has kept them focused on developments in Europe, Africa, India, Australia, and Asia.

Nigel Clarkson’s decades of experience in the data center space preceded him as he spoke about the latest happenings with Stratus Data Centres. Having led the successful construction of major data center facilities in Europe, South Africa, and Asia—from identifying and acquiring sites to overseeing construction and commissioning—he is capable of providing insight into the current state of those markets.

The Stratus Approach

Stratus Data Centres is a data center property platform led and managed by an experienced, specialist management team with over 20 years of proven track record in data center property investments, development, and management.

Two of their largest developments are London and Frankfurt. The London facility is a 100MW data center on a six-acre site in East London and powered by renewable energy. The German project is a 34-acre site that provides an up to 300MW campus. These sites set the standard that Stratus looks to pursue across Europe and Asia.

As Stratus continues to grow, they’ve worked with a number of global investors to identify and secure exclusive access to data center projects and tenants through existing relationships, with the capability to provide comprehensive products that meet tenants’ needs. However, Stratus’ approach varies from a typical data center operator.

Because Stratus isn’t an operator themselves, they don’t compete with tenants in the colocation business. Instead, they aim to be the long-term property partner with customers so they can leverage their expertise in sourcing sites outside their home markets, securing power and planning, and developing build-to-suit data centers in locations across Asia Pacific and Europe—achieving true “resource augmentation” for global hyperscalers and data center operators.

The Need for Local Expertise

Nigel shares that data center developers looking to work in any location that’s not their home will inevitably need the insight of someone who’s on the ground in that country. As someone from Australia but lives in the UK, Nigel acknowledged that he leans on those who are based in the places where Stratus works to develop data centers, particularly in Asia.

What Stratus chooses to do differently when working in Asia is they tend to go into joint ventures to leverage the insight of local experts who know the legalities and all that’s necessary to develop in their city. Whereas Europe has become the backyard of Stratus, the company also knows where they need outside help from local insiders. Working with joint ventures inevitably means more people involved in a project, but Stratus believes this is the best way to develop and deliver great data centers.

When asked about how his work is going, Nigel responds by saying he’s busier than ever. The growth and competition currently happening in the US markets is starting to rise in Europe and Asia Pacific. And as these countries continue to develop the need for more data centers, Stratus will be ready.

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At the end of 2017, there were nearly 400 hyperscale data centers worldwide. By the end of 2020, that number had leapt up to nearly 600. The question isn’t if the number of hyperscale data centers is growing, but where. Current data shows that around 40% of hyperscale centers are in the United States—specifically, Northern Virginia, Northern California, Phoenix, Dallas, and Chicago—have all seen hyperscale development and leasing.

Right behind the U.S., Europe and Asia Pacific have seen growth as well. According to recent data, China currently hosts 10% of the world’s hyperscale sites, followed closely by Japan, Germany, the UK, Australia, Canada, India, and Singapore.

In our conversation with Tag Greason, the Chief Hyperscale Officer at QTS, he shared that the hyperscale market requires four things: scale, speed to market, price, and location. So when it comes to the last variable, how do hyperscale developers decide where to build?

The factors that go into hyperscale site selection

Cost of power will always be a driving decision when it comes to building data centers, and for hyperscale centers, it’s an even bigger factor. The average provider designs for 150-175 watts per square foot, which comes to approximately 7-8 kilowatt per rack. Hyperscale data centers, however, can require 240-300 watts per square foot (15 kilowatt per rack) or more. Depending on the provider, planning for capacity and understanding the costs that go with certain needs is paramount.

In addition to understanding the cost of power, hyperscale centers also pay special attention to the reliability of that power. For a higher degree of reliability (in some cases 99.999%), hyperscale centers often utilize multiple diverse paths with underground service. Many hyperscale centers require feed from two separate substations—preferably from different grids and different providers. And in some cases, the use of different power sources like nuclear and hydro can be used effectively.

Of course, raising the subject of power sources inevitably leads to the topic of sustainability. Hyperscale data centers obviously utilize massive amounts of energy and are therefore under intense scrutiny for doing so in an environmentally conscious manner.

Some companies have gone as far to develop their own wind farms and solar energy plants near their hyperscale operations. And when it comes to issues like water conservation, indirect and direct evaporative cooling techniques have become a common method. All that to say, hyperscale data center developers have to weigh a lot of variables when choosing a location. But one way they’ve gone about doing that work is by following in the footsteps of others.

Current hyperscale developments attract more growth

One of the trends seen with hyperscale data center development is clustering, which allows data center users to take advantage of the infrastructure and connectivity that’s already in place. For example, many believe the Phoenix data center market has similar growth opportunities as Northern Virginia, where hyperscale development is at its highest.

Microsoft and Google’s recent investments into the Phoenix area have made it more attractive to others who are looking to build off of the growth that’s already started there. While Phoenix has the advantage of low operating expenses, we’re also seeing it have the gravitational pull of hyperscale users investing in the market one after another.

So, when looking for locations where hyperscale data centers will be in the future, look at the ones that are already starting to develop. Growth will beget more growth, creating a compounding effect as hyperscale data centers look to cluster near each other and grow together.