DATA CENTER DECISIONS

Transcription

1 2015 Building & Development Leadership Series INSIGHTS INTO EXECUTIVE CHALLENGES DATA CENTER DECISIONS

2 ABOUT THE STUDY To gain insight into the current dynamics affecting executives responsible for data centers and help them make more informed decisions, we surveyed over 220 professionals at the 2014 Data Center World conference. Participants included corporate and institutional professionals, information technology providers and real estate solution firms. PLEASE SEE OUR COMPANION REPORT: Insights into What s Next: Trends in Data Centers CONTENTS Staying Power on the Executive Agenda... 3 Now & Later: A Balancing Act... 4 Optimize Today, Plan for Tomorrow... 5 Growth Decisions... 6 Owning vs. Leasing... 7 What s Around The Corner?... 9 Moving Forward BUILDING & DEVELOPMENT LEADERSHIP SERIES 2

3 STAYING POWER ON THE EXECUTIVE AGENDA Data center capacity growth is expected to endure well into the future, staying top of mind for corporate IT executives, facilities planners and real estate developers. HOW LONG WILL THE STRONG GROWTH OF DATA CENTERS LAST? (All respondents) YEARS YEARS YEARS YEARS 14% 49% 17% 20% Half of data center owners have recently expanded their capacity, and over two-thirds plan additional expansions over the next two years. REGARDING YOUR OWNED AND LEASED DATA CENTER CAPACITY: (All respondents who own or lease data centers) PAST FUTURE Capacity Expansion Over the Past 5 Years = MODERATE 18% 18% 15% 51% = RESPONDENTS SIGNIFICANT VERY SIGNIFICANT Anticipated Expansion Over the Next 5 Years = MODERATE 27% 29% 13% 69% = RESPONDENTS SIGNIFICANT VERY SIGNIFICANT BUILDING & DEVELOPMENT LEADERSHIP SERIES 3

4 NOW & LATER: A BALANCING ACT Data center owners need to devote attention to both optimizing current operations and planning for future use. 5% Workforce Talent 20% All Other 5% Uptime / Latency Issues 6% Standardizing Practices DESCRIBE YOUR BIGGEST MANAGEMENT CHALLENGES. (All respondents who own data centers) 6% Government Regulations 8% Limited Capital 8% Discerning True Requirements 25% Expense Management / Tight Budgets 17% Planning for the Future OWNERS SHARE THEIR CHALLENGES: Operational costs are my primary challenge. It all comes down to power and operating expenses. We need a more accurate forecast of needs. Planning for the future with IT is difficult. Their ability to forecast is lacking. It is hard to keep up with changing government standards. BUILDING & DEVELOPMENT LEADERSHIP SERIES 4

5 OPTIMIZE TODAY, PLAN FOR TOMORROW Whether you re building or leasing new capacity, careful planning sets the foundation for success. Before you take action, understanding all requirements and investigating viable design and configuration options can save you time and money later on. Participants in our survey revealed the mistakes they made when designing data centers and shared advice for others in the planning process. DESCRIBE THE MOST COMMON MISTAKE THAT PEOPLE MAKE WHEN DESIGNING DATA CENTERS. 23% All Other 4% Over-Engineering 6% Failure to Consider All Options 7% Inaccurate Power Load Forecast 7% Poor Mechanical or Electrical Planning / Design (All respondents) DON T MAKE THESE MISTAKES 18% Not Considering / Planning for the Future 15% Lack of Accurate Capacity Planning 10% Choosing Inappropriate Airflow / Cooling System 10% Poor Project Planning / Upfront Process OWNERS SHARE THEIR ADVICE: Most companies follow conventional tried and true methods without employing the latest technology. This causes them to spend a lot more money than they should for a technology that will be obsolete in a few years. Design layouts are too fixed to accommodate the constant changes, updates and expansions that define the data center ecosystem. Cooling and IT load planning are often overlooked in design which leads to thermal problems like overcooling, hotspots and lost IT capacity. You can fall into the trap of over-forecasting business needs without the true future demand to support it. Most designs are cookie-cutter in nature with very little forward thinking. Not understanding requirements results in poor decisions that need to be dealt with for 20 years. You can t just focus on day one requirements. Instead, think out the flexibility to both contract and increase resources. You can make short-sighted decisions based on cap ex alone. BUILDING & DEVELOPMENT LEADERSHIP SERIES 5

6 GROWTH DECISIONS Owners considering capacity expansion face a number of challenging decisions regarding the best path forward. Even the fundamental question of how much capacity is needed is difficult to answer. Respondents shared their toughest decisions when planning to expand. 9% All Other 7% What is the optimal configuration / design? 7% What are the mission-critical must-haves? 10% Determining ROI WHAT IS HARDEST TO DECIDE REGARDING CAPACITY EXPANSION? 10% What location? (All respondents who own data centers) 37% How much capacity will we need? 20% Build, renovate or lease? OWNERS SHARE THEIR TOUGH DECISIONS: It is very hard to know the exact amount of capacity our organization will require. How big should we make our expansion. Difficult to determine the ROI of increased energy efficiency versus going with a conventional approach. What applications should we classify as mission critical? BUILDING & DEVELOPMENT LEADERSHIP SERIES 6

7 OWNING VS. LEASING Corporations and institutions have a wide variety of leasing options available to them through real estate companies and software / cloud technology firms. Despite these options, many still own a significant portion of their data center capacity, and expect to continue to do so as they expand. DOES YOUR COMPANY OWN AND MANAGE YOUR DATA CENTERS IN-HOUSE OR OUTSOURCE? (Corporate & institutional respondents) IN-HOUSE MOST / ALL MOST COMBINATION 50% 14% 22% 14% COMBINATION MOST / ALL OUTSOURCED IF YOU WERE TO EXPAND YOUR DATA CENTER FOOTPRINT IN THE NEXT MONTHS, WHICH WOULD YOU LIKELY DO? (Corporate & institutional respondents) BUILD A NEW SPACE LEASE AN EXISTING SPACE 47% 28% 26% RENOVATE OR RE-BUILD BUILDING & DEVELOPMENT LEADERSHIP SERIES 7

8 OWNING VS. LEASING A desire to maintain important mission critical capabilities internally, even as other services are outsourced, is reflected in respondents belief that corporations and institutions will continue to own a meaningful portion of U.S. data center capacity up to 10 years from now. ROUGHLY WHAT PERCENT OF OUR COUNTRY S SERVERS WILL BE OWNED BY THE FOLLOWING 10 YEARS FROM NOW? (All respondents) 42% 31% 28% SOFTWARE SOLUTION OR INFORMATION TECHNOLOGY PROVIDERS REAL ESTATE SOLUTION PROVIDERS (BROKERS, COLO, ETC.) ALL OTHER ORGANIZATIONS & CORPORATIONS Those who decide to lease additional capacity rather than own often do so to defer or avoid capital spending. Many also believe leasing is less risky than creating new internal capacity. 8% Better Uptime Performance WHAT IS THE TOP REASON BEHIND YOUR DECISION TO LEASE? (All respondents who would lease new space rather than own) 7% All Other 31% Defer or Avoid Cap Ex Spending 23% Better Speed to Market 31% Lower Risk BUILDING & DEVELOPMENT LEADERSHIP SERIES 8

9 WHAT S AROUND THE CORNER? Water, or the increasing lack of, could become a major issue for data centers in the next 10 years. According to our survey, operating expenses for power and cooling is the leading factor in facility location, design and construction. One of the components, cooling, could be affected by current and future impacts to municipal water supplies. Across the nation, signs of stress to the water supply are clear from long-standing droughts in the west and aquifers in Florida to California reaching historic lows to algae blooms in the Great Lakes that affect potable water. Consumers are already feeling the pinch even in places like the Midwest with water rationing mandates, such as limited days for watering lawns and gardens. Will it affect our industry? Farmers have already faced water restrictions. It s not a stretch to assume that as a leading group of commercial water users, data centers and other corporate users may experience challenges as well. Those challenges could come via cost increases, public scrutiny or new laws and restrictions. IMPLICATIONS FOR DATA CENTERS Some data centers are already affected by water shortages. Newer water districts in Colorado, for example, charge higher rates than established districts. One of our data center clients had to abandon an initial plan to install evaporative cooling for a less energy-efficient chilled water system. An evaporative system would have cost the client 10 times more annually for water for a 100,000 square foot, 6 MW data center than if it had been located in a more established water district. LEADING THE WAY IN CONSERVATION Some major data center operators are taking steps to reduce water use, including Google s 1 move to incorporate recycled water. Microsoft s 2 air-cooled facilities in Iowa, Ireland, Virginia and Washington are designed to use 1-3 percent of the water required for a traditional data center, and the only water loss in these new systems is through evaporation, resulting in no waste water. Another effort to address water use and encourage conservation was launched in 2011 by Green Grid 3, a consortium of companies, government agencies and educational institutions dedicated to advancing energy efficiency in data centers. Having introduced the now universally applied Power Usage Effectiveness (PUE) metric, Green Grid developed a water efficiency measurement called Water Usage Effectiveness (WUE) to complement PUE. Although it hasn t become mainstream yet, a few leaders such as Facebook s Oregon data center 4 are using the new WUE measure. THE FUTURE FOR DATA CENTERS While water resources are a concern for some data centers, not all report this same viewpoint. Water is still a natural resource that is subject to geographic variance in supply and demand with some areas not experiencing any current limitations. Since water usage is regulated by local government agencies, it takes time to enact price increases. Therefore, rising water costs may not become an issue for many locations in the immediate future. Even so, the risks are real even dire for some and the nation s water issues are moving closer to claiming a place on the list of issues that data centers must consider. For our part, we will continue to monitor it and bring forward appropriate solutions and insights that help our customers succeed today and tomorrow. WATER TAP DEMAND FEES Significant Variance between Neighboring Jurisdictions Fees varied widely for a data center on a 10-acre site using evaporative cooling, a 2 meter and an estimated 16 million gals per year. District 1 - $175,000 District 2 - $335,000 District 3 - $2,300, BUILDING & DEVELOPMENT LEADERSHIP SERIES 9

10 MOVING FORWARD Data center owners and operators face high stakes challenges, as poor decisions can lead to difficulties that must be dealt with for decades. In our work day-to-day with data center owners and operators, we witness the perpetual task of assessing the trade-offs between capex and opex. Fundamental considerations, such as where to locate a data center, become trickier because decisions must be made without fully knowing future requirements. In this type of environment, owners are also feeling pressure to reduce energy and cooling expenses. (Read more about these issues in our report: Insights into What s Next: Trends in Data Centers. ) For all of these challenges, we are ready to help you navigate the complexities of data center decision-making. In fact, this sets us apart rather than putting all the hard work on your shoulders and waiting to be told what to do, we roll up our sleeves and dig in alongside your team, right from the start. You gain the confidence to move forward when Mortenson is by your side. For more than 20 years, Mortenson has served the data center construction needs of enterprise companies, multi-tenant data center providers, internet/network services and telecommunication companies. We re recognized by the industry as a top 5 builder of data center facilities, and by our customers as a trusted partner. We welcome the opportunity to share more with you about Mortenson s data center expertise and unique capabilities. BUILDING & DEVELOPMENT LEADERSHIP SERIES 10

11 DATA CENTER LEADERS To learn more, please contact one of Mortenson s professionals. CRAIG SOUTHORN National General Manager: Data Centers craig.southorn@mortenson.com WENDY DAVIDSON National Business Development: Data Centers wendy.davidson@mortenson.com SCOTT GANSKE National Operations Director: Data Centers scott.ganske@mortenson.com ANDY STAPLETON Chicago, IL andy.stapleton@mortenson.com BOB SOLFELT Development Services bob.solfelt@mortenson.com CHUCK HAIGH Seattle, WA Portland, OR chuck.haigh@mortenson.com GENE HODGE Denver, CO gene.hodge@mortenson.com GEORGE FORRISTALL Phoenix, AZ george.forristall@mortenson.com BRENT BERGLAND Canada brent.bergland@mortenson.com KELLY NOEL Milwaukee, WI kelly.noel@mortenson.com JEFF CUPKA Federal Contracting Group jeff.cupka@mortenson.com BUILDING & DEVELOPMENT LEADERSHIP SERIES 11

12 BUILDING WHAT S NEXT SM Mortenson is recognized as one of the nation s top data center builders. Our future-minded thinking, customer advocacy and dedication to quality have allowed us to create numerous and diverse data center facilities for Fortune 100 customers as well as governments and institutions. A U.S. based, family-owned business, Mortenson Construction is a leading builder in North America. Our services include designbuild, real estate development, construction management, general contracting, EPC / BOP and project development. From top-of-the-line healthcare and education facilities, cutting-edge stadiums and LEED-certified mission critical projects to some of the most innovative renewable energy projects on the planet, Mortenson is building structures and facilities for the advancement of modern society. For questions regarding the contents of this study, please contact Steve Pekala, Market Intelligence Director: or steve.pekala@mortenson.com M.A. Mortenson Company. Mortenson is a registered trademark of M.A. Mortenson Company.