Is the data centre market prepared for surge in demand?

As the demand for data centres continues to grow, Matthew Dent, CEO of Volta Data Centres, explains what this means for CIOs.

From the inexorable rise in Apps to the Internet of Things, the shift towards the cloud is changing the way organisations consider every aspect of the IT infrastructure.

Add in the huge investment in big data that demands high performance computing to run complex analytics across massive datasets, and it is unsurprising that demand for data centre space continues to grow. According to the latest figures from Gartner, data centre spending will reach $143 billion in 2015 – and set to nearly double over the next five years.

This is great news for data centre providers – especially given the high volumes of empty space still available outside London. But what does it mean for CIOs looking for the best location for the next generation of business critical systems?

Not all data centre space is the same and the trends that are driving this growth, most notably cloud computing, are placing new demands on power, security and resiliency.

The problem for the data centre industry is that a significant proportion of available space is no longer fit for purpose and continued reliance on legacy technology models – from low density racks to inefficient CRAC (Computer Room Air Conditioning) cooling – will without doubt compromise the long term viability of data centre space.

Changing Demands

Every data centre has to wrestle with one essential challenge: making the most of the power and space available. And to do that, the latest generation of data centres is exploring a raft of innovative technologies, from high density racks to row based cooling, in order to maximise every square inch of space available.

They are also delivering the resilience required to offer 100 per cent Service Level Agreements, with multiple Tier 1 and Tier 2 carrier services and power feeds from separate substations.

For CIOs, however, the issue is not just about finding a data centre that offers the required location and resilience. It is about achieving an essential flexibility in IT delivery – from the ability to locate high density computing racks alongside low density networking racks to the demand for utility based billing. While the industry has been beginning to talk about the suitability to move away from the inflexible three, four or five year contracts few providers are prepared to make that move.

Which is one of the reasons why we disrupted the market by introducing the option of Power by the Hour utility-based billing. Businesses are charged by the Kilowatt hour, with charging beginning when equipment is installed in the data centre. This service uses itemised billing to enable companies to accurately monitor their power consumption and only pay for what they have used – a radically different approach to traditional, inflexible contracts.

Market Direction

This model is clearly targeted at start-ups, small businesses and larger organisations requiring project based resources – those companies looking for an affordable, zero commitment route to a cloud infrastructure or outsourcing to a colocation site for the first time.

However, it also indicates a willingness to respond to CIOs’ changing expectations – and throws down the gauntlet to the rest of the market still hanging on to a contract model that is as up to date as the underpinning technology infrastructure.

Of course, for those data centres still reliant on legacy technologies the challenges are significant. How can these spaces embrace the innovative technologies and designs required to meet CIO demands for flexibility? How can an upgrade be achieved without disrupting existing customers? Is it even possible to make improvements given the limitations of power and connectivity?

While some data centres are looking to add pockets of innovation – such as small areas of high density racks – they are still constrained in the way services are delivered, with companies having to split infrastructure across different rooms or floors.

Given the difficulties associated with upgrading existing facilities, it is perhaps not a surprise that new data centres are being developed. Despite the continued availability of space, the industry recognises the importance of delivering highly efficient, resilient and flexible data centre services – and the fact is, it is easier to do that in a new site than to refurbish and update an existing one.

The problem for London based CIOs, however, is that this space is all being built outside the capital, creating problems regarding access and the speed of engineer response to critical issues.

Conclusion

This trend fundamentally reinforces the message that huge swathes of empty data centre space may well remain empty despite the growth in demand because they cannot deliver the high levels of resilience, power and efficiency required.

They can’t offer companies the chance to locate high density racks for intensive computing alongside the low density racks required for networking, all within a single Service Level Agreement; and they simply don’t have the sophistication needed to respond to market demands for more flexible pricing and shorter term contracts.

For CIOs planning ahead and tracking the demand for data centres, the truth is that space is not the issue. It is that vital combination of location and technology innovation that is actually the key to achieving that essential flexibility in IT delivery.

The question is not: is there enough space to meet predicted demand? But, rather, at what point will customer demand actually outstrip the availability of the robust, resilient, truly effective data centre space required to support today’s cloud computing requirements?