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Apple To Build New $2 Billion Data Center In Bankrupted GT Advanced Buildings
mrspoonsi writes Apple announced it will spend about $2 billion to build a new data center in Mesa, Arizona. It will be housed in buildings formerly used by GT Advanced Technologies (GTAT), which went bankrupt last year after failing to supply sapphire display covers for the iPhone 6. The data center will be powered entirely by renewable energy. It will be a "command center for our global networks." Apple has said it would help find work for people affected by GTAT's bankruptcy. It's possible some of those former GTAT employees might help construct the new command center. When Apple initially partnered with GTAT to make sapphire displays, the company invested millions in a sapphire production facility. It makes sense that Apple would want to do something with the building if it couldn't make sapphire there.
When I saw this snippet in TFS:
I actually thought "just like a conquering nation making their new prisoners build their own prisons."
Welcome to the Panopticon. Used to be a prison, now it's your home.
That's not cynicism, this is cynicism.
Promise contract to company.
Make contract impossible to fulfil.
Bankrupt company.
Sweep up company assets on the cheap.
???
Profit.
Your forgot 'write-off your holdings of company debt for pennies on the dollar'.
Bankruptcy was the planned outcome if the sapphire didn't workout. Leaving most of the debt in Apple's hands.
John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
More like:
receive contract offer from company.
Accept contract you know you can't possibly fulfill.
Fail to meet the terms of the contract.
Go bankrupt.
???
While we like making the big company the bad guy. GTAT Executives were the ones who really screwed up. If you are going to have a business relationship with Apple, you better be sure that you are big enough to operate without Apple.
It is no secrete that Apple is very fickle when it comes to venders. If you are not giving what Apple wants they will not sit there and take it, they will drop you in an instant. Apple has the resources to drop seemingly vital venders, and rework its products just so they get the deal that they want.
GTAT should have known this, and avoid Apple unless they had the resources to manage without them as well. However they just beefed up their company size to produce something on a mass scale that they haven't before. Just so they can have a chance to win a contract.
If I were a GTAT employee I would be more pissed at the executives for hiring you for a high risk position without letting you know the actual risk.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
slight ftfy:
Promise contract to company.
Make contract impossible to fulfil.
Bankrupt company.
Sweep up company assets on the cheap.
Profit.
These are so-called "lights out" operations because they employ so few employees (relative to the prior residents) that the ultimate benefit to the community is extremely limited.
There's even a new german data center where they scrub out much of the oxygen. Apparently it helps with both security and fire control. No humans can go in.
I'm surprised by the choice however because one of GTs claims was constant power disruptions were a factor in their poor crystal quality. does not bode well for a data center. And I would think that one would prefer cool outside temperatures and a source of water for cooling would be good too, both of which are in short supply in most of arizona.
On the otherhand GT's original product was solar cells. And Arizona is a good place for clear skies and sun in the US. maybe they are thinking about a solar powered data center? I'd think it not important to co-locate it near the solar cell supplier however.
The ultimate benefit to the community will be taxes and perhaps upgraded infrastructure.
Some drink at the fountain of knowledge. Others just gargle.
Right, I mean, getting a data centre building for half a billion dollars losses is really cheap. Sounds like an ideal business plan!
Alternatively (and involving more sanity), Apple started a deal in good faith with a company. It didn't work out. Apple went out of their way to figure out how the deal going south could do as little damage to the community as possible.
You have obviously never built out a data center after the walls are up, the AC is running at full blast, and rows after rows of empty racks are waiting for installation of servers, switches and fiber cables.
While I agree that GTAT doomed itself by signing the agreement with Apple, the terms of the agreement were so outragious that I think that Apple still deserves a lot of blame. Here's the Forbes article on the contract:
http://www.forbes.com/sites/chuckjones/2014/10/30/this-is-why-apple-did-not-want-its-gtat-contracts-made-public/
First of all, Apple were the ones who bought the land and facilities they are turning into a data centre FOR GTAT to use to make Saphire. So they already own the plant.
Secondly, they have not bought GTAT at all. At least hate Apple for legit reasons, not made up ones.
You buy a company, bankrupt it because your idea didn't work out and then offer to help some of the people who;s job you destroyed.
What part of your statement is true?
Did Apple buy GTAT? No. They paid GTAT for a contract to build sapphire that GTAT could not deliver. When GTAT declared bankruptcy, Apple would be their largest creditor and are entitled to some portion of the assets but they did not "buy" GTAT. The rumors are that Apple advanced GTAT $350 million to build whatever facilities they would need to supply Apple with the necessary amount of sapphire and equipment. So GTAT may have spent part or all of the money.
Second it wasn't Apple's idea to get into the sapphire business for GTAT. GTAT was in the business long before Apple. Now GTAT's problem was that they were not a large scale manufacturer of sapphire or manufacturing equipment. At best they had a small business doing both. According to estimates, Apple would need at least 2600 furnaces to meet with estimates. From what I read, the original agreement was that GTAT would manufacture, install, and operate those furnaces at an Apple facility. They were not able to do so and the agreement had GTAT manufacturing rather being simply an equipment manufacturer.
Well, there's spam egg sausage and spam, that's not got much spam in it.
While they were to blame, that wasn't exactly what happened. They bound themselves to a contract which was skewed wildly in Apple's favor. Basically they bore all the risk - borrowing all of the money to gear up for production, resulting in them bearing all the losses if the product didn't live up to specs or if they weren't able to produce sufficient quantity. Normally in a situation like this, a vendor orders and pays for samples, the manufacturer produces them, then the vendor decides whether or not to pay for a full order. In this case, Apple requested samples, the GTAT execs went "OMG Apple!" and bent over backwards (or forwards depending on what analogy you want to use), borrowing huge amounts of money and investing it in massive production facilities when they didn't even have a firm order from Apple yet.
Apple bears some of the responsibility for using their huge size to coerce behavior out of a supplier, like how Walmart coerces suppliers to give them ruinous pricing. But the bulk of the responsibility lies squarely with GTAT for agreeing to those terms. Companies like GTAT or Walmart suppliers (or even employees who meekly accept whatever terms their employer sets) put themselves into these situations through their unwillingness to stand up for themselves just to hold onto a contract (or a job).
It's like the saying goes, before you can respect someone else, you have to respect yourself. These companies (or employees) didn't respect themselves, and it's only a natural consequence that they get walked all over. Show some pride in your work. If you truly believe you have the best thing since sliced bread, then it's Apple which should come to you on their knees begging if they want their products to have the best components. If they don't, it's their loss and their competitors' gain.