House hunting for your data: it’s all about location, location, location
The same logic and strategy applies to data. Where companies choose to store their data must be in a location where it can “meet” that of reciprocal industries to mutually benefit and speed innovation, enhance productivity, increase revenues, and compete in the global marketplace on an around the clock basis. These locations are often multi-tenant data centers where companies can find other parties to help fill in the gaps in their spare data to accomplish these tasks. For companies collocated in Equinix data centers, this nexus point is called Marketplace, a platform where buyers and sellers who would benefit from a fast, direct connection to each other, meet and share data.
For certain industries, it’s easy to cherry-pick the right data center real estate – financial firms, for example, naturally focus on collocating in New York, London and Hong Kong. But data, like companies, can originate a connection between a metro and an industry. After all, “Silicon Valley” hasn’t always been a part of our vernacular (it was coined in 1971). This same phenomenon is happening now in Amsterdam data centers and the content delivery networks (CDNs) located therein.
Low latency is a critical element to the success of CDNs, networks tapped every time an Internet user watches a movie online, downloads a song or even visits a popular website. This made Amsterdam, which has one of the fastest Internet Exchange points in Europe, a natural location for CDNs of e-commerce, advertising, broadcasting and gaming industries to congregate. The Netherlands’ high-speed connections to the rest of Europe also bolstered Amsterdam’s data-driven bid to become the epicenter of content: typical latency from the Netherlands to London, Paris and Frankfurt is less than three milliseconds. Moreover, companies with data housed in Amsterdam data centers can connect to 80 percent of Europe within 50 milliseconds. Think of these speedy Dutch networks as an office water cooler – an established hub attracting scores of parties that while related, might not normally meet.
But it’s not just Amsterdam’s Internet Exchange (AMS-IX) that makes this corner of Europe attractive to data centers and those looking to collocate in them. Multiple transatlantic cables that have been in place for over a decade have their endpoint in the Netherlands, which makes it almost surprising that Apple is only now considering Eemshaven, a coastal Dutch town where a transatlantic fiber-optic cable makes landfall, as the potential location of a new $2.7 billion European data center. With iTunes averaging over 15,000 song downloads every minute, Apple requires flawless, speedy content delivery, and the Netherlands fits the bill as a prime location for the company.
Data center providers are also attracted to the Netherlands for its focus on green initiatives. Provision for clean technology is an increasing imperative in data center design as these buildings use electricity 24/7 for air conditioning and powering the servers and switches inside. The Netherlands was the first country to apply the OECD’s (Organisation for Economic Co-operation and Development) set of green growth indicators, published to help world governments analyze and improve the implementation of environmentally conscious policies. Green data center initiatives equals lower overhead for companies seeking to build their own private facilities and for companies collocating in a multi-tenant data center built with green technologies in mind.
While finding the perfect location for company data involves figuring out which region’s infrastructure matches the needs of the company’s industry, it’s also important not to be overly reliant on one place. For example, Tokyo is an established financial capital, but the city and the area around it is prone to earthquakes and tsunamis. This shouldn’t deter businesses from locating their data in a Tokyo data center, but a sound disaster recovery (DR) measure to consider is renting a space 300 miles away in another well-connected metro, Osaka. The fact that Osaka’s GDP outstrips Hong Kong and Singapore makes this location extremely attractive to a host of companies seeking a presence in Osaka data centers for reasons other than DR.
No matter what propels businesses to expand in certain regions versus others, being strategic about data center location can significantly improve business service speed and the ability to rapidly share large quantities of data with partners and customers. With data sitting at the heart of the global economy – and quickly becoming its currency – the time is now for companies to identify the markets and metros that matter to them, and optimize their data center investment accordingly.
Raouf Abdel is the Regional Operating Chief, Americas for Equinix.