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Data Center Building Boom In Silicon Valley

1sockchuck writes "Data center developers are building like mad in Silicon Valley, with seven active projects in Santa Clara alone. The building boom includes the resumption of several stalled projects that prompted concerns of a shortage of wholesale data center space in the Valley. The flurry of construction activity is different from the overbuilding during the dot-com boom, which was characterized by too much funding and too few customers. This time, industry experts say, the end of a funding drought has created a situation in which construction is struggling to stay ahead of demand from companies like Facebook — which just scarfed up an entire new data center in Santa Clara."

7 of 96 comments (clear)

  1. sure sure by timmarhy · · Score: 4, Insightful
    "The flurry of construction activity is different than the overbuilding during the dot-com boom"

    thats what they all say.

    what about when the next fad comes along and facebook is forgotten over night?

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    1. Re:sure sure by nacturation · · Score: 5, Insightful

      what about when the next fad comes along and facebook is forgotten over night?

      If you subscribe to the theory that Facebook has built demand, then that demand (with the corresponding need for servers) will shift elsewhere. If it ends up being that a large part of the demand simply vanishes, then yeah... they will have overbuilt.

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    2. Re:sure sure by davester666 · · Score: 4, Informative

      Um, I would be more worried about electrical capacity.

      It's not like California is overloaded with the stuff...

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  2. Re:A lot of commercial real estate sits empty by bezenek · · Score: 4, Interesting

    Several former office-space buildings are being converted to data centers.

    In a regular commute from West San Jose to the Google-plex area in Mountain View I have seen these changes. An existing office building has its windows removed/covered and then a sign goes up showing data center space available or the name of a data warehousing company.

    This conversion seems less wasteful as far as materials, but I am not sure how using an existing building compares to building a data-center-specific one for long-term energy efficiencies.

    -Todd

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  3. Power density?!?! by mcrbids · · Score: 4, Interesting

    Don't know if you've ever taken a look outside a data center, but they often have multiple, high-voltage power feed dead-end at the building. At my current colo, the excellent Herakles data center in Sacramento, CA, they are literally located directly under a major set of power lines.

    So you take some office building that was burning perhaps a couple hundred watts per 100 SqFt during mid-day, and colocate 42U racks within, raising energy density from maybe 200 watts/100 SqFT to a few thousand. To give some idea, I personally oversee about 3,000 watts in a single 1U rack at my colo, well over 200 cores, and many terabytes of data. And that's in a single 1U rack, maybe 24" wide and 36" deep, with some allowance for aisleway... and my situation isn't even mildly unusual.

    We're not talking 3,000 watts capacity, we're talking 3,000 watts 24x7 continuous draw, of redundant, backed-up power - the most expensive kind. Whole houses usually don't draw this much. And this is a *single* 42U rack.

    This is feasible? That's a *lot* of power...

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  4. Re:Strange move by evilviper · · Score: 4, Insightful

    So, people are constructing new data centers on some of the most expensive real estate in the USA, in an area with highly paid IT workers

    The price of the land is pretty trivial, as relatively little is needed, and lots of money will be made with it over the next few years.

    IT workers are highly paid as a side-effect of being the most highly skilled people available. Put a data center in Oklahoma, and you'll find some nice cheap IT workers, who have very little idea what they are doing. In a competitive market, the employees have to be just as competitive as the employers. The ample supply of highly-skilled labor is exactly why companies want to be there.

    with zero company loyalty

    See above. "Company loyalty" is actually a negative symptom. All those I've seen who have been employed at a company for a decade or more, do so because they are sufficiently incompetent to not find better pay or challenges elsewhere, but are just good enough to provide some value to the company.

    There have been many papers written on the fact that, as pay increases over the years, the relative cost/benefit to employees goes down. Short-term employees is actually a preferred option. And frankly, if companies needed or sufficiently wanted employee loyalty, they just need to reverse the past 20+ years of taking away all benefits, but they'd rather not do that. Only a fool is loyal to a company in this day and age.

    and an area of high electricity rates.

    We're talking, what, 50% more expensive than the cheapest reliable electricity in the country? While it's not the cheapest, it isn't terrible.

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  5. This makes sense if you look at all facts by Whuffo · · Score: 4, Informative

    One thing that the commenters here have overlooked is the availability of direct connections to the Internet backbone. The biggest nexus of end and peering points is right there in Silicon Valley so hooking into huge bandwidth is much less expensive than it would be in other locations. Is the property cost too high? It used to be, but these days there's plenty of vacant space and the costs have gone down substantially thanks to the recession. There's plenty of electrical power available and it's in close proximity to a very large population of internet users. What's not to like?

    Those who see this as a boom that will produce jobs that are worth moving to Silicon Valley for are best advised to stay home. The recession has hit the IT folks there very hard and there's about 30% unemployment in that field. Data centers aren't places that require large staffs; one or two people to monitor the systems is about it and they'll do it all from moving servers around to fielding support calls. There's nothing there for people coming from out of state and nothing for the folks that are already here. Many of those H1B workers and illegal aliens have already left for home and more are leaving every day; even the slaves are bailing out.

    Facebook has already jumped the shark, so their build-out in Silicon Valley will become even more vacant space in the near future. Green energy was planned to be the next boom but it's stillborn so the hard times in the valley are going to continue for now.

    Really - if you're thinking of moving to Silicon Valley from out of state - stop now. The chances of employment are very slim and the expense of living there is very high; the best you could do is submit resumes until you run out of money. You're better off almost anywhere else.