The Raritan Blog

Measuring The Economic Impact Of One Data Center

Posted on October 31, 2018 by Jessica Ciesla

It is no secret that the world revolves around data. This data might take many forms, and for those people with child-like imaginations it might seem as if the data is floating by in the air just out of reach. However, the reality is far simpler: data needs to be stored somewhere, which has led to a boom in data center construction across the world. From micro-embedded data centers to submerged ocean data centers, companies are rapidly expanding their global data center portfolios. The question that remains is, "why?"

Where And Why Are Large Scale Data Centers Being Built? 

In 2014, managed hosting provider Cervalis announced that it would create a massive data center in Connecticut. The construction and maintenance of the data center promised to bring 3,000 jobs to the area. In a location that is close to the water, New York City, and Boston, but suffers from hurricane threats and winter storms, the question on everyone's mind was, "how valuable would the move be?" The answer was a sweet $400 Million when CyrusOne purchased Cervalis data centers in New Jersey, New York, and Connecticut in 2015. By expanding its portfolio to 31 data centers, CyrusOne was able to successfully branch out into the U.S., UK, and Singapore markets.

Fast forward to 2018 and another big name, DC Blox, has continued its own ambitious plans for building U.S. based large scale data centers. The company envisions stretching into 19 secondary markets within the Southeastern sector of the United States. Currently the company only has online locations in Chattanooga and Atlanta. However, the company just announced that it has purchased a 27-acre former steel plant in Birmingham, Alabama. In August, DC Blox will begin construction and in September its Huntsville location will open.

While most data center companies have gone the traditional route of pitting cities against each other for massive tax breaks, DC Blox has taken a different tactic. It believes that data centers should be built in locations where the local community can work together to accomplish something that is truly amazing (and of course financially beneficial). In this vein, DC Blox chose Birmingham because it is home to two major regional banks, a major university, has a very strong health care sector thanks to Blue Cross Blue Shield, and conveniently doesn't have a reliable purpose-built data center. 

Understanding The Financial Impact Of Data Centers 

If DC Blox's data center location strategy pays off, then it could reach a $785 million investment over the next 10 years alone. While DC Blox stands to benefit, so too does the local economy. According to a recent U.S. Chamber of Commerce's Chamber Technology Engagement Center (C_TEC) report, the average data center has the possibility of adding $32.5 million to the local economy every year. Additionally, data center construction has the opportunity to create an extended economic impact. The same C_TEC report found that during construction a data center will spend an average of $77.7 million on 1,688 local workers. This figure coupled with the average $9.9 million in revenue paid to local governments and the state on yearly basis, can provide the funds needed to support public services and thus further bolster the local economy. 

However, in the face of the potential for a strong financial impact, data centers must avoid becoming "too caught up in the numbers." If a data center fails to be reliable, have a high uptime rating, and remain secure, then it will not survive, which means that the positive financial impact will cease to exist after construction. To this end, if the local economy and the data center want to enjoy a lucrative financial investment, then they need to take efforts to future-proof their technology solutions from day one.

Thanks to Raritan's intelligent PDUs, data centers can now enjoy a future proof design architecture that's built for the long haul, while simultaneously providing the reliable power management needed to enjoy a positive ROI. But what is reliable power management without a strong defense against cyber attacks? Cue the introduction of KVM switches to protect vital data from cyber criminals. This simple tool can eliminate risky data sharing, provide additional control, remove desktop clutter, and block the signals used during a cyber-attack. The moral of the story is simple, data centers will continue to be built at rapid rates across much of the globe. Whether large or small, every data center has the opportunity to provide a positive financial impact on the local economy, so long as the right tools are used to create an environment of reliability, security, and agility for years to come. 

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http://www.datacenterdynamics.com/content-tracks/design-build/cyrusone-pays-400m-for-cervalis-ny-data-centers/93814.fullarticle
http://www.datacenterknowledge.com/archives/2014/02/03/cervalis-opens-new-connecticut-data-center
https://www.al.com/opinion/index.ssf/2017/07/building_data_centers_creates.html
www.al.com/news/index.ssf/2018/07/lesson_in_dc_blox_win_when_no.html
https://www.uschamber.com/report/data-centers-jobs-opportunities-communities-nationwide