The Data Center Market is at a Peak

It’s quite the claim to make: that the data center market is at a peak. Here’s why I think it is.

“Today’s IT industry is dealing with data explosion. Therefore, companies need a data management system to manage the huge amount of generated data. Data centers are already under tremendous expansion mode in terms of storage and computing to accommodate the growing volumes of data and run computation on top of it,” writes CIO Review. Data retention also factors into space. IOT will increase data stored and analyzed and retained. Private cloud, hybrid cloud and computing infrastructure have to be housed somewhere.

Space isn’t really the limiting factor. Power is. Cooling is also becoming a limiting factor. Cooling to some degree affects the power. The US had not built a new power plant since 1996 — until Wats Bar 2 came online in Tennessee this year.

Solar farms are starting to pop up. And there has been activity in wind farms. Amazon is turning up a wind farm in Texas. “Iron Mountain, a global storage and information management service firm, has agreed to purchase up to 100,000 MWh of power from the in-development Amazon Wind Farm Texas.”

Google is working on a zero waste data center. ” it takes a lot of power and resources to do all that data churn [from Google search, Docs, Drive, Music, YouTube, etc], which is potentially quite wasteful. Thankfully, however, the search giant has committed to a new initiative called Zero Waste to Landfills so that all of the waste from those data centers will be reused or diverted to a more sustainable route.”

That is just the moves to make running data centers cheaper. But that means that data centers are going to be around a long time — and there will be more of them.

Facebook’s data center in Sweden made a social splash via a virtual tour. These giants – FB, GOOG, Amazon – are getting creative with data center builds, designs and usage.

The amount of M&A activity is high (compared to previous years and dollar values of the deals.) One example is Windstream selling its data center business to Tierpoint for a big profit. I mentioned some of this back in January. Since then, CenturyLink is taking bids for its data center business that it put together with Qwest Cyber Centers and Savvis.

Verizon is near a deal to sell its Terremark division, according to reports. That $3B will help VZ buy some more spectrum — or just to pay off the debt on the AOL purchase.

Private equity firm Silver Lake Partners is exploring a sale of Vantage Data Centers, looking for a billion dollars.

ViaWest is expanding in Denver.

There are federal mandates for data center optimization that must be met by 2018.

Data centers play a huge part in IT – whether the company has public cloud or private cloud or a colo. The hybrid nature of IT infrastructure for the enterprise lends itself to a continued reliance on data centers in the US.

Tags: cloud computing, collocation, data center, mergers
Related tags: center market, center business, limiting factor, private cloud, centers, center