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Will Silicon Valley Run Out of Data Center Space?

1sockchuck writes "With capital scarce, data center developers are prioritizing projects in northern Virginia, where the Obama stimulus plan and federal shift to cloud computing are likely to boost data center demand from government agencies. This is forcing them to delay or scale back large projects in Santa Clara, setting the stage for a supply/demand imbalance in Silicon Valley, particularly for large space requirements. One potential mitigating factor: some currently occupied data center space could become available through the failure of venture-backed startups."

40 of 142 comments (clear)

  1. dream on by Anonymous Coward · · Score: 5, Informative

    There is a TON of unused data center space in the bay area, as dotcoms have folded up or moved.

    1. Re:dream on by cantcomplain · · Score: 5, Informative

      You may be partially right--some of the facilities have space. But some that have "tons" of space are maxed out or near it for power and cooling. Some are not accepting new clients or anticipate turning away business in the next few months. I think it was 365 Main that turned me away and said the move to the cloud would be consuming their capacity. Some of the tenants at 200 Paul have space but some of it is pretty ghetto and limited by power. At least that's what I found in a cursory search dictated by a ceo that doesn't want to build out a server room (40kva w/10 tons hvac) at a new site. If you know cheap and usable co-lo space, all the sushi you can eat!

    2. Re:dream on by simontek2 · · Score: 2, Informative

      BDAW.com has some space, they are in the verizon building on 8th and Hope in Downtown LA. Peer1 usually has space all over the place.

      --
      SimonTek
    3. Re:dream on by mcrbids · · Score: 2, Informative

      As a former 365 Main customer, I can say that our move to Herakles Data in Sacramento went smoothly, and what a difference! Great, reliable service, redundant EVERYTHING (unlike 365 Main which gave me A network feed and A power strip) with a bigger rack and more power, and at a BETTER PRICE.

      Seriously, it's dramatically different, night and day in just about every way.

      When 365 Main had their power woes a couple years back, it was all lawyer-speak about validating any kind of claim, because we *were* promised 99.99% uptime in the contract, but we'd have to sue to get it. They didn't even bother to respond to our legal letters and issued only cryptic, terse public notices.

      When Herakles data had a core Cisco router go "half dead" a few months back, (blown enough to cause problems, but not cause backup routers to step in) causing a few hours of downtime, they sent detailed analysis of what happened, and then they SENT US THE FORMS if we wished to file a claim. It was even partially filled out! (we didn't file, just because of the trust and goodwill this fostered)

      I was originally impressed with 365Main because it *is* technically a nice facility, but in terms of service quality and price, Herakles (1.5 hours drive away!) has them beat hands down.

      Get a REAL data center!

      --
      I have no problem with your religion until you decide it's reason to deprive others of the truth.
  2. I say DIG by Fluffeh · · Score: 4, Interesting

    I think we should start building hardened data center sites miles underground! And have like nukes defending them! And there should be these huge walls that don't allow anyone in or out! And guard dogs!

    Sorry, for a moment there, I thought we were still in a cold war.

    Maybe they could just move them next door to the next valley? I am sure there are plenty of nice valleys around that are just waiting to take all the required new data centers. Maybe snap up some bargain land from those plummeting subprime land prices?

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    Moved to http://soylentnews.org/. You are invited to join us too!
    1. Re:I say DIG by Anonymous Coward · · Score: 5, Interesting

      Case in Point

      World's most secure data center

      This underground data center has greenhouses, waterfalls, German submarine engines, simulated daylight and can withstand a hit from a hydrogen bomb. It looks like the secret HQ of a James Bond villain.

      And it is real. It is a newly opened high-security data center run by one of Swedenâ(TM)s largest ISPs, located in an old nuclear bunker deep below the bedrock of Stockholm city, sealed off from the world by entrance doors 40 cm thick (almost 16 inches).

    2. Re:I say DIG by magarity · · Score: 3, Informative

      Meh, there are plenty of sites available to build your own hardened data center.

    3. Re:I say DIG by tcopeland · · Score: 4, Funny

      > there are plenty of sites available [missilebases.com]
      > to build your own hardened data center.

      You'll need to watch for deep crows, though.

    4. Re:I say DIG by clarkkent09 · · Score: 2, Insightful

      Maybe they could just move them next door to the next valley?

      Does it even matter where the data center is physically located. I'd say go where the climate is such that it requires the lowest expense on cooling or heating, and where the land, hookers and beer are cheapest.

      --
      Negative moral value of force outweighs the positive value of good intentions.
    5. Re:I say DIG by Antique+Geekmeister · · Score: 2, Insightful

      Yes, it does. If you've ever tried either to install someplace out of the way where tools and replacement parts are difficult to obtain, or where the data center staff are cage monkeys who've never actually read their own contract and how they're supposed ot have a console and keyboard available within 20 minutes of a phone call plugged into the correct server because you "economized" by paying for a "higher service level" and didn't buy remote KVM's or power controllers, then you know exactly what I've encountered a dozen times in the last decade. Having to leave my desk, drive to a facility in another state or country, and show them how it's done.

    6. Re:I say DIG by Nefarious+Wheel · · Score: 2, Funny

      And it is real. It is a newly opened high-security data center run by one of Swedenâ(TM)s largest ISPs, located in an old nuclear bunker deep below the bedrock of Stockholm city, sealed off from the world by entrance doors 40 cm thick (almost 16 inches).

      But ... is it proof against Ninjas? Looks like the perfect spot to relocate TPB.

      --
      Do not mock my vision of impractical footwear
  3. Not even possible by Brian+Gordon · · Score: 5, Insightful

    a supply/demand imbalance

    If there's demand, someone will supply it. If the demand is for unrealistically cheap service, then that's not real demand.

    1. Re:Not even possible by maxume · · Score: 2, Interesting

      If there is a large seizure, some drug or the other might not be available at any price, at least for a short period of time. Some owners might not be willing to part with art at any price, putting the value they place on the item far above any buyer (or even a variety of buyers). Hence the dysfunctional markets.

      --
      Nerd rage is the funniest rage.
    2. Re:Not even possible by sessamoid · · Score: 3, Insightful

      a supply/demand imbalance

      If there's demand, someone will supply it eventually. If the demand is for unrealistically cheap service, then that's not real demand.

      Doesn't mean it will happen soon, or that a lot of businesses aren't going to suffer until the imbalance is addressed.

      --
      "No, no, no. Don't tug on that. You never know what it might be attached to."
    3. Re:Not even possible by mano.m · · Score: 2, Insightful

      If the demand is for unrealistically cheap service, then that's not real demand.

      Yes, it is. You can't know what's 'unrealistically cheap' unless you've pushed the envelope and actually negotiated for a lower price. In a down economy, and with enough buying power looking for low prices, you might even be able to wrangle an unprecedented discount.

      --
      Karma fed to this user will be promptly burnt. Be warned; be wary.
  4. And the power will come from where? by FullBandwidth · · Score: 3, Interesting

    Coal-burning plants in the Appalachians, and a massive transmission line that Dominion Power wants to run across large swaths of W Va and VA. Now that the administration is behind the idea, the local opposition doesn't stand a chance.

    --
    My friend Debbie Ann is so promiscuous, instead of an appointment book she needs a package manager
  5. Re:misspelling in title by mhh5 · · Score: 4, Funny

    Perhaps it wasn't a typo... but a snide remark. Silly-con -> Sillicon

  6. Rust Belt by Anonymous Coward · · Score: 2, Interesting

    I wouldn't even consider building a fresh data center here, just because of earthquakes alone.

    Move to Sacto or something.

    How about those Rust Belt states? Or Detroit? Or anywhere else where there are lots of out of work folks and where the cost of living is a fraction of California? There are colleges and universities that have CS and engineering programs outside of CA - meaning, you can find people with the necessary skills in other areas in those parts of the country. They're not all blue collar union members who refuse to learn new skills.

    1. Re:Rust Belt by magarity · · Score: 2, Informative

      meaning, you can find people with the necessary skills in other areas
       
      What skills? A few people at the data center have mad skillz but most of them just need to know how to swap out tapes and failed hard drives and to not press the reset button until expressly told to do so. Most of the administration of the software, which is what needs the most training and skill, happens by people who are off site. Usually in India.

    2. Re:Rust Belt by MeatBag+PussRocket · · Score: 2, Insightful

      While i would personally love to see a place like WY, or the rust belt get a bunch of data centers, there are some issues that would need to be addressed that realistically leave the northeast and west coast the only major viable locations for most data centers. Firstly, the issue of infrastructure rears its head in much of the midwest, WY, MT and the like, are likely lacking sufficient power supply and readily available bandwidth to realistically facilitate large amounts of data centers. While it is not necessarily outrageous to supply these services here, it does take time, years to build power plants and run fiber trunks. Secondly, data centers like to be close to their clients, or actually clients like to be close to their data centers, and its not just for the paranoid CEO who is afraid of his 1's and 0's being counted, for example, many financial institutions rely on low TTL numbers for precision stock market transactions, which is why there is a large number of data centers in northern NJ, directly across the Hudson from the stock exchange. The physical distance of a corporations data could make it less profitable. If distance were of no concern Australia would probably be the best place for data centers. there is also the factor of talent pool. personally i'd love to live in WY, but not many engineers i know would agree, and even in a tough economy asking your workforce to uproot and move to what they may feel is barren-wasteland ville-tucky will probably yield a lot of attrition (they didnt name the badlands in WY "the badlands" because of the convenient shopping.).

      i'm sure theres excellent rebuttals of these points, its not really something i've researched but off the top of my head, thats what i think. correct me where i'm wrong.

      --
      i wage a holy war against the apostrophe.
  7. No more startups by Kohath · · Score: 5, Informative

    No, it won't be a problem.

    There will be very, very few new startups in the US. And many of the existing startups will shut down. There's just not much point in starting a business in the US any more.

    - IPOs used to be plentiful, but that was before Sarbanes-Oxley made going public astronomically expensive.
    - The government is sucking up most of the country's available capital [to buy votes] for stimulus and other government spending, leaving less available for business growth.
    - The new stock option rules more-or-less preclude giving lower-level employees company stock so they share in the success of the company.
    - Even for those that do see success, the tax rate will be 60-70% in a few years, so they won't be able to keep much of what they make. They won't be able invest the money in new startups because the taxes will take too much and there will be none left over.
    - And don't forget that everyone knows businesses are villains and rich businessmen are hated. Why subject yourself to all that for such low after-tax gains?

    See this article by Victor Davis Hanson.
    See this article by T. J. Rodgers of Cypress Semiconductor.
    See this article by Michael S. Malone.

    It's not really the land of opportunity any more -- not unless you know just the right people in government or the environmental industrial complex to steer you an earmark. And even those will run out in a few years after all the money is spent and all the output from the country's slowly-declining future production is borrowed and spent.

    There will be plenty of vacant data center space.

    1. Re:No more startups by YesIAmAScript · · Score: 4, Informative

      Gloom and doom never gets old. We were definitely doomed in 2000 also. And 1994.

      I don't think Sarbanes-Oxley has anything to do with the number of IPOs. IPOs are such a ridiculous money making scam that increasing the overhead a few percent isn't doing to dampen anything. I'd say the reduction in the number of IPOs is more to do with the stock market in the toilet than anything. Companies don't go public to succeed anymore, they go public to get a huge stock pop, and you won't get that right now.
      You're right about the changes in stock options to low-level employees, but my understanding is there are no new rules, companies are voluntarily expensing stock options now. Which, to be honest, they should have done all along.
      The tax rate will be 60%? Marginal tax rates aren't even at 30% for most people right now. Remember, it's Silicon Valley, your house costs $600,000 and the tax on the interest is deductible. I know people with 14 exemptions on their W-4, virtually all of which come from them paying $28,000 in interest on their house each year. That means if you're making $100,000, 28% of your income isn't subject or state or local taxes at all!

      - And don't forget that everyone knows businesses are villains and rich businessmen are hated. Why subject yourself to all that for such low after-tax gains?

      Good point, now what are you going to do with your business degree? I'd be lying if I said I was disappointed that your ilk might no longer be rushing to Silicon Valley to make their money for nothing but calling themselves executives and quoting tax regulations.

      --
      http://lkml.org/lkml/2005/8/20/95
    2. Re:No more startups by Kohath · · Score: 2, Informative

      Which other countries were a better place than the US to start a company in the 1950s? It was just after WWII and most countries were rebuilding.

      Which countries are a better place than the US to start a business in 2009? And in 2011 when the taxes start kicking in? And what about the years after that? There are lots of countries that won't be capping their carbon emissions, for example.

      Also, government as a percentage of GDP was about half as large in the 1950s. And the regulatory burden was much lower.

    3. Re:No more startups by chebucto · · Score: 2, Interesting

      The relevant portion of the article:

      The non-partisan think-tank calculated the average local tax rate in New York State at 1.7 percent, and combined it with the 8.97 percent that high-bracket state taxpayers will shell out in 2011, when the health care plan is set to take effect. Tack on the 39.6 percent federal tax rate, 2.9 percent for Medicare and 5.4 percent for the health care "surtax," and the figure is 56.92 percent for the Empire State.

      In New York City, the top tax rate is 3.65 percent, making the Big Apple's top combined rate even higher.

      The $544 billion tax hike would violate one of President Obama's ironclad campaign promises: No family will pay higher tax rates than they would have paid in the 1990s.

      Under the bill, three new tax brackets would be created for high earners, with a top rate of 45 percent for families making more than $1 million. That would be the highest income-tax rate since 1986, when the top rate was 50 percent.

      So the figure is below 60%, an aggregate tax rate, and applies to people in NY state earning over 1 million.

      It's _less_ (at the fed level at least) thank it was in 1986, in the midst of Reagan's reign. In fact, federally, it's an increase of _5%_ over today's tax rates.

      How is this the end of the world again?

      --
      The English word fart is one of the oldest words in the English vocabulary.
  8. Is this still "theonion.com"? by Old97 · · Score: 2, Funny

    I'm confused, I've been watching some videos and reading stories on the Onion's site. This story just fit right in.

    --
    Very often, people confuse simple with simplistic. The nuance is lost on most. - Clement Mok
  9. Half-empty dc's by raybob · · Score: 2, Interesting

    I've worked in several large datacenters in the Atlanta area for various clientes in the past few months. These things are overbuilt, and half or more of their capacity looks idle. Speaking with dc staff, many of even the populated cages are idle/bankrupt/abandoned.

    And the dc salesmen have seemed pretty eager last 6 months or so. I've bought some rack space & virtual servers recently, and got some shinin' deals.

    So I can attest to the fact that at least that postulate about dc capacity being underutilized.

    But, things seem on the upswing now though, at least my intuition says so.

    1. Re:Half-empty dc's by drdanny_orig · · Score: 4, Interesting

      I live and work in Sunnyvale, and I'm here to tell you that half the office space in this area is empty. Buildings that started going up two years ago have stopped, rusting in place. And at the rate people and businesses are leaving I don't think space is going to be a problem.

      --
      .nosig
  10. Unfortunately by gtrubetskoy · · Score: 4, Funny

    There are only two places in the US where datacenters can be built - Silicon Valley and Northern Virginia.

  11. Agreed by symbolset · · Score: 5, Interesting

    With improved density current installation needs should be met forever even without folding .coms.

    More importantly, the datacenter should locate somewhere with cheap power, labor and real estate that has good fiber. Where in the world it is is irrelevant - people who run servers don't fondle the hardware any more.

    --
    Help stamp out iliturcy.
    1. Re:Agreed by kriston · · Score: 4, Interesting

      Northern VA doesn't have cheap power, definitely does not have cheap real estate, but we do have lots of good fiber. You can't mow your lawn without breaking some.
      The vacancy is horrendous. I work in a virtually abandoned office building (upper four floors completely vacant) and pass 20 other empty offices on my way to work, not to mention the data centers that America Online abandoned even before they were brought online.

      --

      Kriston

    2. Re:Agreed by Samgilljoy · · Score: 5, Funny

      I had a vision once of server farming becoming a family tradition among people in certain parts of the world, replacing agriculture.

      Server farmer's almanac? heh heh

    3. Re:Agreed by Eevee · · Score: 2, Funny

      people who run servers don't fondle the hardware any more.

      Oh, how little you know...

  12. Who cares where the data center is? by schwep · · Score: 4, Insightful

    Just put in a fat pipe to the data center & connect it to the backbone. Data centers are (by design) a commodity, and as such will be outsourced to where it makes sense.

  13. Why... by QuietLagoon · · Score: 4, Informative

    ... do the data centers need to be located in Silicon Valley? I thought this thing called The Internet negated the need for geographical co-location.

    1. Re:Why... by mikael · · Score: 3, Insightful

      This article seems to list everything a corporation should consider:

      Price of power
      Networking infrastructure
      Accessibility
      Talent pool
      Local incentives

      --
      Vintage computer adverts: http://www.vintageadbrowser.com/computers-and-software-ads
    2. Re:Why... by MillionthMonkey · · Score: 2, Interesting

      Just because the Internet is involved doesn't mean everything you do can just happen anywhere. People administering datacenters often need physical access. They might also have other jobs to do. They might be on a team that isn't all IT administrators. There may be face-to-face interaction required to get anything done. Real world considerations often intrude.

  14. Re:Well, no.... by Kohath · · Score: 2, Insightful

    So fix Medicare and leave the rest of the health care system alone then.

    The comprehensive plans are basically a huge organizational clusterfuck aimed at subsidizing Medicare using the taxes and premiums of healthy people, rationing care for everyone so you can ration it for Medicare recipients too, and forcing doctors and patients into low value/low physician-pay outcomes by denying all other choices. Some of us aren't willing to have our life-and-death choices subject to government bureaucratic decision trees. But none of the plans will ultimately allow us to opt out and pay for care in cash (a favorable alternative to dying or suffering on a waiting list in many cases) because that option will destroy the leverage that governments have to force physicians to work for below-market reimbursements. (Note how no one asks malpractice lawyers to work for below-market rates. Hmm. I wonder which party those lawyers give money to?)

    My health-care costs aren't going up 8% per year. I'm not spending too much of my GDP on health care, because I don't have a GDP; I'm a person. The government can fuck off when it comes to my health care. And this is a matter of life and death for me and everyone else who uses health care. It's not like people are just going to acquiesce. This conflict on health care will continue to escalate and intensify until the ruling class backs down.

  15. Re:Well, no.... by YesIAmAScript · · Score: 2, Insightful

    Lots of young people think they can just pay for their medical costs in cash. I have bad news, your twenties and thirties are not the expensive parts of your life in terms of medical care.

    -This conflict on health care will continue to escalate and intensify until the ruling class backs down.

    The ruling class are the people who own the insurance companies and such, they're not actually the friend of the working man, they just want your money.

    --
    http://lkml.org/lkml/2005/8/20/95
  16. That's ridiculous by tjstork · · Score: 2, Interesting

    . Some of us aren't willing to have our life-and-death choices subject to government bureaucratic decision trees.

    What's the difference between government and an insurance company? I just don't get it. I'm not seeing how you could be any more bureacratic that Cigna, Aetna or Blue Cross.

    . And this is a matter of life and death for me and everyone else who uses health care.

    Either way, its not your money. Your life or death decisions are making my health care more expensive, public or private.

    --
    This is my sig.
  17. It isn't the square footage.... by Hasai · · Score: 2, Insightful

    ....It's the watts.

    You can brag about density all you want, but if you can't deliver the needed wattage to the racks AND the HVAC tonnage to carry away the dissipated heat, it doesn't amount to a hill of beans.

    --

    Regards;

    Hasai