How the data center market is changing

Tim Chadwick, President, Alfa Tech

For many companies, a data center has become a necessity. Whether your company is considering building its own stand-alone data center or renting space in a colocation center, there are some recent trends to consider.
“The trends happening fall down different lines,” says Tim Chadwick, president of Alfa Tech. “There are some commonalities that happen on both sides, but things that work for the enterprise market don’t always work in the colocation world.”
Smart Business spoke with Chadwick about what companies should watch for in the changing market for data centers.
What are the latest data center trends in the market?
The major trend right now in designing,  building and operating data centers is improving energy efficiency — reducing the carbon footprint. The fringe benefit of this environmentalism is saving on utility costs.
In moving toward energy efficiency, what we’re able to do for enterprise customers is look at the specific equipment to be used — the specific types of computers, storage devices and networking equipment — and really tailor the space to that equipment. The best example of that is the air that enters the computer to cool it. With an enterprise customer who may know specifically what equipment he is going to buy, the designer of the data center can let that temperature go a lot hotter or colder, or the air more humid or dry than past data center designs allowed.
In the colocation market, the colocation facility’s owner rarely knows what his tenants will require. The whole point of being a colocation landlord is you want a facility that appeals to everybody. If you were to build a facility that could only house a type of computer that can take hotter air, you are limiting your market. So builders and designers of data centers don’t always have as much flexibility in colocation spaces. Enterprise spaces have more innovation, more things happening. But what’s happening in the enterprise market is starting to find its way into the colocation market.
How is the enterprise market driving the colocation market?
For instance, Facebook has proven that you can use most servers at higher inlet temperatures. Once you start to get people to realize that, there is a larger clientele that is willing to go into a data center (like a colocation space) with higher temperature ranges. Instead of always seeing facilities using 75-degree air, they might see 80 or 85 Fahrenheit. When you have those higher temperatures coming in, that is where you can achieve big energy savings. You are spending less to cool your computers and equipment. And sometimes you’re not spending anything; the data center could just be bringing in fresh air from outside.
Because it’s already happening in the enterprise market, more people are willing to try it in the colocation market. Ten years ago, the only lease people would sign up for was guaranteed 75-degree air going into your computer. Now more and more people are considering that the old way of thinking. As long as people are open-minded to go to a higher inlet temperature, the colocation owner can pass along the savings. If the facility is cheaper to build and operate, he can charge you less for rent.
What other trends are occurring?
There have been changes in electrical in regard to the power coming in. We are starting to see more variations on the voltage coming into servers. That opens up opportunities for energy efficiency, and it has led to a similar situation with the enterprise customers driving the market for those sharing and leasing data center space.
Once one enterprise customer buys a thousand servers at a previously unknown voltage, the price point comes down. If there is no demand, the supply price is high. If you can increase demand to where there is a viable market, Dell, HP, IBM — the big computer manufacturers — are starting to see a market in these different voltages, so the price point is coming down. If you can buy cheaper equipment and save energy, that is the best of both worlds.
How would a company know what voltage is necessary for its data center?
You can buy the same computing platforms at different voltages. It’s a matter of what type of infrastructure you are plugging into. If you are in the U.K., for example, the voltage is different than in the U.S. So you have to make sure your server can plug into that and absorb the different voltage. If you’re in a colocation market, you have to talk to your provider and find out the available voltages at his facility. If you’re in a purpose-built data center, you work with your consultant to figure it out and design around your needs.
However, companies need to find a balance. Everyone is trying to wring out every last cent from the design and construction, without realizing that if you can get the end customer to buy different voltage equipment, they could save 5 percent in annual energy costs, for example. That might be true, but that different voltage equipment might cost 10 percent more in capital costs.
It might be worth it. But when you compare 10 percent more in capital costs versus a 5 percent annual savings on energy, sometimes it just doesn’t pencil out. You have to be careful to look at the whole picture. Quite often, data centers are not designed holistically. They aren’t designed knowing what equipment is going to be in them.
The key to a good design is a good understanding of the equipment that will be used in the space.
Tim Chadwick is president of Alfa Tech. Reach him at (408) 487-1278 or [email protected].