Large enterprises handing off data center builds

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 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 per cent 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 per cent 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 per cent) said their projects will exceed 15,000 square feet, and 49 per cent expect their data center projects to be supported by at least two megawatts of electrical power (including 12 per cent that are planning data center projects with five 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 per cent 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 per cent 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.”

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