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Microsoft Plans $1 Billion Server Farm In Iowa

1sockchuck (826398) writes "Microsoft will invest $1.1 billion to build a massive new server farm in Iowa, not far from an existing data center in West Des Moines. The 1.2 million square foot campus will be one of the biggest in the history of the data center industry. It further enhances Iowa's status as the data center capital of the Midwest, with Google and Facebook also operating huge server farms in the state."

28 of 86 comments (clear)

  1. Server farm in Iowa. Who knew! by Anonymous Coward · · Score: 5, Funny

    you can grow servers from seed. Does Monsanto know about this???

  2. Saves about $38 million in taxes by dbIII · · Score: 5, Insightful

    Makes sense, it saves about $38 million in taxes which you guys are going to have to cough up instead of Microsoft.

    1. Re:Saves about $38 million in taxes by manquer · · Score: 4, Insightful

      Very rarely the number of people directly employed makes the difference, If Microsoft is spending $1 Billion in the state, it will probably source significant % of components locally( usually part of any tax break agreement), that will generate lot of business for the local economy, the vendors will in turn will be ordering components, magnifying the effect on the economy, the state tax on all these other transactions will perhaps offset the breaks given to Microsoft.

      On the other hand, paying 84 people for 6 years will do very little for the economy by itself

    2. Re:Saves about $38 million in taxes by Charliemopps · · Score: 3, Insightful

      All states do this. To attract big projects each state offers lower taxes for a period of time, free or discounted utilities, temporary changes to regulation etc... Whomever makes the best offer gets the facility. The state will collect far more than $38 million from the people that work there's income taxes alone. Not that the state/city can't make mistakes if they're stupid... but this deal isn't bad for the state at all.

    3. Re:Saves about $38 million in taxes by Anonymous Coward · · Score: 2, Insightful

      I'm self-employed. Because of higher taxes (I live in Quebec, where the government is finding new ways to tax people every year), gas price and a higher cost of living in general, I had to raise my hourly rate in order to have the same standard of living. So when you think about it, it means it's not me who is paying my taxes, but "you guys".

      You think big corporations are different? You think they pay their taxes out of their pockets?

    4. Re:Saves about $38 million in taxes by citizenr · · Score: 2

      Very rarely the number of people directly employed makes the difference, If Microsoft is spending $1 Billion in the state, it will probably source significant % of components locally

      Sure, they will buy all those locally build processors and memory chips.

      --
      Who logs in to gdm? Not I, said the duck.
    5. Re:Saves about $38 million in taxes by TubeSteak · · Score: 4, Insightful

      The state will collect far more than $38 million from the people that work there's income taxes alone.

      Microsoft will create 84 jobs when fully built out, with 66 of those jobs required to have a wage of $24.32 an hour.

      $24 an hour is ~$40,000 after federal taxes and social security.
      According to my math, at Iowa's 6.8% tax rate, it'll only take ~208 years to recoup $38 million in personal income taxes.

      Those other 18 jobs are undoubtedly for security guards and janitorial staff, at an even lower wage.
      So don't count on that to noticeably bump up the average.

      TLDR: Microsoft is getting a lot of tax breaks and subsidies in return for bupkiss.

      --
      [Fuck Beta]
      o0t!
    6. Re:Saves about $38 million in taxes by ColdWetDog · · Score: 3, Insightful

      Corn chips, memory chips. To a politician it's all the same.

      --
      Faster! Faster! Faster would be better!
    7. Re:Saves about $38 million in taxes by PNutts · · Score: 3, Insightful

      On the other hand, paying 84 people for 6 years will do very little for the economy by itself

      Strippers and fast food restaurants disagree.

  3. Re:Server farm in Iowa. Who knew! by K.+S.+Kyosuke · · Score: 5, Funny

    Internet is for corn!

    --
    Ezekiel 23:20
  4. Re:But can it fix the by jones_supa · · Score: 2

    Everything should be fine in Windows 9.1 Update 1 Refresh 1 Patchouli 1.

  5. Re:But what about Detroit?!?! by Anonymous Coward · · Score: 2, Funny

    Maybe they want to keep their servers from ending up in the local pawn shop...

  6. Re:Why 1.1 billion? by Anonymous Coward · · Score: 2, Insightful

    Dollars are a measure of importance. If such an encrusted Pi were actually constructed, it would indeed be newsworthy.

  7. Re:Why 1.1 billion? by RabidReindeer · · Score: 3, Insightful

    Dollars are a measure of importance. If such an encrusted Pi were actually constructed, it would indeed be newsworthy.

    Dollars are speech. Just ask the US Supreme Court.

  8. Alternative power? by swb · · Score: 4, Funny

    Are they going to run it off any alternative power sources?

    I could see a pig shit methane plant, Iowa produces 1/4 of all pork in the US.

    1. Re:Alternative power? by geekmux · · Score: 4, Funny

      Are they going to run it off any alternative power sources?

      I could see a pig shit methane plant, Iowa produces 1/4 of all pork in the US.

      Microsoft converted a long time ago. Unfortunately, they suffered a methane meltdown sometime around 2012 that contaminated their production floor.

      I'm rather surprised you didn't catch a whiff of this while running Windows 8...

  9. Yeah by Anonymous Coward · · Score: 2, Interesting

    there's huge demand for NSA run hosting facilities worldwide.

  10. Yawn. by sirwired · · Score: 4, Insightful

    It's hard to understand why, after all these years, local and state governments STILL haven't figured out why it's pointless to spend one thin dime of tax incentives on projects like this. They persist in visions of row upon row of cubicles filled with hard-working, high-paid, tax-paying programmers. When, in fact, after construction, the total payroll is little different from a simple warehouse or small wholesale distro center that they would never consider paying any incentives to attract. The data center might have a half-dozen or so skilled tech workers, if that, and the rest of the staff are going to be low-paid parts-swapping monkeys. The "real" work will all be done remotely. If you have a limited incentives budget, why spend it on a data center?

    Moreover, unless the community is blessed with a large amount of "spare" power (like areas with oversized nuc plants or the cheap hydro in the Northwest) all that grid capacity going into a power-hungry, job-poor, data center could be better spent on other projects.

    1. Re:Yawn. by tomhath · · Score: 2

      The incentives are in the form of tax breaks. A big data center like this will still generate some tax dollars and add to the local economy - enough to cover the additional expenses. The rest is just funny money, tax revenues they wouldn't have collected without the project, so no loss.

    2. Re:Yawn. by jader3rd · · Score: 2

      It's hard to understand why, after all these years, local and state governments STILL haven't figured out why it's pointless to spend one thin dime of tax incentives on projects like this.

      Because they can point to a single structure and say "I helped make this happen." Even if it's a losing proposition most voters will still feel that at least the politician is doing something. It's a lot harder to keep tax laws equal for all and point to the gains which get spread around to everybody and in a re-election campaign say that the small growth everyone is realizing is due to your policies.

    3. Re:Yawn. by TubeSteak · · Score: 2

      It's hard to understand why, after all these years, local and state governments STILL haven't figured out why it's pointless to spend one thin dime of tax incentives on projects like this.

      That's easy.
      Nobody ever does a ROI study.
      Not after 1 year, after 3 years, or after 5 years.

      The States/Counties take the puffed up corporate predictions at face value and then nobody checks to see that the promised value (but not in any legal binding way) is actually created.

      --
      [Fuck Beta]
      o0t!
  11. The Corn! by jamesl · · Score: 2

    Oh, the corn. Think of the corn. Children will starve in Des Moines.

  12. Is it far enough away ? by Alain+Williams · · Score: 3, Insightful

    The project Alluvion site is approximately 8 miles east from the current Microsoft data center in West Des Moines

    8 miles is not far. It is not too hard to envisage a disaster that could affect both sites at once. For starters: Iowa is smack in the middle of Tornado Alley. They are close enough that power supplies and Internet connections will be 'related'. OK: it makes it easier for staff to visit both sites, but 80 miles seems to me safer than 8.

    1. Re:Is it far enough away ? by silas_moeckel · · Score: 2

      Would it not be simpler to consider both facility's as one as far as DR planning goes? Assuming they do not do anything that requires sync replicated SAN's (distance limited due to max latency) you want a DR facility in another time zone.and or growing zone.

      --
      No sir I dont like it.
  13. That's the Hollywood argument by dbIII · · Score: 4, Interesting

    That's the Hollywood argument. So how's the Californian government getting on after all that tax evasion?
    The reality is no trickle down but instead just hitting someone else for the funds and ultimately a different industry hobbled due to not being picked as a winner.

    1. Re:That's the Hollywood argument by superdana · · Score: 2

      That's the Hollywood argument. So how's the Californian government getting on after all that tax evasion?

      Pretty well.

  14. Re:Saves about $38 million in taxes - NOT by uberdilligaff · · Score: 2

    Your math skills need considerable upgrade. Making conservative estimates (ignoring deductions, using the unmarried tax rates, etc), a $60K job pays $3700 per year in Iowa state income tax. 84 of those amounts to $310,800 per year. 10 years brings $3,108,000 to the state. In 100 years, the state will not recoup the $38 million in taxes from worker income taxes alone.

    Math is more informative than off-the-cuff assertions. Embrace it.

    --
    Against stupidity, the Gods themselves contend in vain. --Friederich Schiller
  15. Re:Why 1.1 billion? by Dogtanian · · Score: 2

    Why is the price tag more important than the technical details? A diamond and gold encrusted Raspberry Pi in a large warehouse could cost 2.2 billion...

    Yes, it could. And if such a Raspberry Pi would exist, much like the data center designs of the largest providers in the world, you would know very little about it for security reasons.

    The price tag is more important in this case because it probably *does* reflect the scale and possible power of the project. It's not likely to be being expensive for the sake of being expensive

    The hypothetical Raspberry Pi isn't a good comparison, since it was contrived for the sake of being expensive and none of that expense has much effect on the core function. Real-world examples of such devices- i.e. much, *much* cheaper devices with masses of expensive trim glued on (such as "the world's first Arab supercar", (*) Vertu phones et al) would only ever be made as status symbols, so they're not likely to be kept secret, and the type of people who own them would probably be able to keep them secure when not in use (**), you just lock them away.

    By contrast, the data centre is expensive for a reason, serves a purpose and can't be locked away. Not really that good a comparison.

    (*) Where I already criticised the ludicrous contrived expense of such tacky bling-ified items by pointint out that one could make the world's most expensive car by gluing the Koh-i-Noor diamond to an ageing Vauxhall Corsa, yet its "value" would say sod all about its core function as a car itself.

    (**) "In use" being when they want to impress someone who's as much of a bell-end as they are, or lure some gold-digger into bed.

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