Northern Virginia Still Dominates Data Centers

Image credit: CBRE

by James A. Bacon

Northern Virginia accounted for 64% of wholesale data-center construction in the U.S. during the first half of 2020, as measured by megawatts of electric power consued, according to a CBRE report, “Data Centers Critical to Business Operations.” The construction trend reinforces the region’s role as the biggest, baddest center for data warehousing in the U.S. and the world.

Led by Loudoun County, the region touts 1,275 megawatts of “inventory,” about three-and-a-half times that of the No. 2 data-center cluster, Dallas/Fort Worth, and more than four times that of Silicon Valley.

The national outlook for the industry is favorable, says the report. “Companies are prioritizing IT spending as they restructure their overall budgets. While every dollar of investment is subject to scrutiny, a focus on mission-critical IT spending will be important to support remote working, transition to online platforms and serves, and to support online marketing and sales to consumers.” (Hat tip: Bill Tracy)

A CBRE interview with Charles Meyers, head of Equinx, the world’s largest network of interconnected data centers, shed light on some of the factors that go into locating data centers. Here are some lightly edited excerpts of what Meyers and Pat Lynch, CBRE managing director for Data Center Solution have to say:

Work-at-home, the digital economy, and 5G. There’s an immediate need to support a new work style for many of our clients. So it’s brought the data center and the network and the importance of that to the forefront for almost any company in the world right now. … I think the bigger driver is really the importance of digital and digital transformation as a business priority for people and also how important digital is to the lives of the consumer, and therefore all the people that are delivering those services who need to continuously upgrade and adapt their infrastructure to meet those need. … As the bandwidth increases, the uses to suck it up seem to continue to go with it. And I think 5G is going to be another example of that.

Why megawatts and not square-footage? Real estate investors might get confused by some of the terminology in data centers talking about how space is rendered via megawatt or gigawatt instead of rent and other measures of net absorption and other traditional real estate measures. …. The underlying force that drives a data center is power. So you have a data center, and how many kilowatts per cabinet you’re looking at, and those kind of things. So it does take some getting used to.

In the real estate world, it’s rent per square foot. And in the data center world, it is rent per kilowatt plus energy typically. And how do  you convert that into a price per square foot? … We have assets that back in the day and the level-three world we built to 75 watts a square foot. And people thought we were crazy. We’ll never use it. And there’s clients of ours today that are building well in excess of 300 watts per square foot. So the conversion becomes very difficult and actually meaningless because it really depends on the power that you’re utilizing.

Power hogs. We are absolutely significant users of power. … [The data-center percentage of world energy consumption] is north of seven percent now, particularly as you look at the power consumption requirements of data centers built by the major cloud hyperscale companies, for examples. But it really depends a lot on what the nature of the data center is, because there are data centers where they can be located proximate to low cost power, resources, and proximity, perhaps to sources of cooling, whether that be deep water cooling or free air cooling and very cold environments. However, not all data centers can be out in the middle of nowhere because the need for them to deliver information in a real-time fashion is still there for many uses cases. And so you see this sort of tiered architecture of data centers where large server farms with less real-time needs can be located further out, closer to power sources. But the ones that are driving where data needs to be cached or transmitted between parties in near real time are going to be closer to urban centers where fiber densities are higher and connectivity is higher.

Green power. We’ve committed to a 100 percent renewable energy to power our data centers and really advanced very significantly towards that goal, and are north of 90 percent already.

Security. There are many different levels of security. … The reality is that the amount f investment and technology we apply to the physical security problem in our own data centers is probably meaningfully higher than what they can apply now in terms of their digital security.

— JAB

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24 responses to “Northern Virginia Still Dominates Data Centers

  1. It is a shame the speed of light is so slow. I’d like to see more data centers in central Virginia…

    • Be careful what you wish for. Unless you think that targeting NOVA for destruction would be a good thing for Virginia. 😉 Just kidding, just kidding. While I’m not certain of the precise geographical location of the centers in NOVA, I have to wonder whether it’s a good idea to put that much data in one place, where a well structured attack could jeopardize so much.

      • There are backups elsewhere – at least of our stuff…

        • that’s the thing about the internet. You could totally wipe out BR on Jim’s server – and chances are there are multiple copies of it all over the place…

          Once something is on the internet – it’s said – it’s forever – unless of course we have a world-wide EMP.

      • data typically does not stay in one place. Data centers are not generally sole archives… Responsible organizations and corporations “store” their stuff at multiple locations…

        • Irresponsible ones don’t, and can’t recover when they get hit with ransomware.

          • which is usually not major corporations – but cities, towns and school systems these days.

            A responsible organization has all their files at other sites so that if their primary site gets whacked – they can restore.

            There is software available, one brand is called Tripwire – and what it does is monitor system files for changes 24/7… If you’re not doing that – you’re an accident waiting to happen.

            Most Unix/Linus -based systems were never designed to be secure at the start – the opposite in fact… they have a zillion “ports” open and listening .. and it’s not that hard to find out which ones have buffer overflow issues…

        • Look at the calibre of IT staff that most cities, towns and school systems tend to have and it’s no wonder why they get hit with ransomware and can’t recover. Nobody knows you’re not doing any backups until you need them.

          As far as Linux security, the default configuration for most Linux distributions these days is to have exactly one port open, that being SSH. And that is usually firewalled by default to only allow connections from the same subnet that the Linux machine is on.

          • If so, how to explain so many hacks?

            do they “undo” the defaults?

          • They do undo the defaults. Most hacks are the result of careless and/or sloppy system administration. Basically the computer equivalent of going on vacation and leaving your front door unlocked.

  2. Somewhat related. An interesting discussion at last nights MPO meeting (regional transportation) with respect to remote work and impacts to transportation.

    The group was split. Some are convinced that remote work is going to shrink dramatically as the pandemic recedes. The other half convinced that the pandemic accelerated a trend already happening.

    What does this have to do with data centers? A LOT!

    and at to that remote learning (even after the pandemic recedes) and rural broadband.

    These data centers of the 21st century equivalents of massive rail yards that occurred in many cities in the interior and ports as rail was ascendant.

  3. I heard this news item last week on WTOP radio by the business reporter.

    Here is his write up: “King of the Cloud” they call NoVA.
    https://wtop.com/business-finance/2020/09/northern-virginia-remains-the-king-of-the-cloud/

    I guess it’s good to be King. On the radio they said the lure of NoVA was (1) strong tax breaks, (2) cheap elec, and (3) the fiber optic network.

    Jim- is the statement that the centers “already use 90% green power” figure for USA or Virginia? I wonder how they came up with that number?

    My recent beef is I bet they pay a lot less for elec than I do….easy for them to request renewable since I am paying. I am OK if they build their own solar or whatever.

  4. Per Wikipedia … “MAE-East was originally created in 1992, primarily by Scott Yeager of Metropolitan Fiber Systems (MFS) and Rick Adams of UUNET. Steven Feldman, an Internet architect, recalls “A group of network providers in the Virginia area got together over beer one night and decided to connect their networks.”

    Hence, the MAE-E peering point. Hence the concentration of data centers in Loudoun County. (MAE-E) was originally in the parking garage of an office building in Tysons Corner.

    Notice how there was no mention of the General Assembly, business development funds, etc. Just some entrepreneurs with an idea. In fairness, the Loudoun County BoS did agree to run almost endless conduit throughout the eastern side of the county ahead of development. This made pulling the network cables a lot easier and less expensive when the data centers were built. And, perhaps most importantly, the whiz-bangs in our state government were kept far, far away from the internet in NoVa. They’d rather stand around in the woods smoking shad anyway.

    Just remember that, once built, data centers employ very few people and the people they do employ are generally not the highly paid tech folks you think of in respect to the cloud. Loudoun County may have the physical assets but the west coast has AWS, Google and Microsoft. Virginia did not win the cloud wars by any stretch of the imagination.

    Finally, 5G may actually reduce the need for massive concentrated data centers. Real 5G (using mmWave spectrum) will dramatically increase bandwidth and even more dramatically reduce latency. Think in terms of 600X faster than 4G over today’s networks. Aye, and there’s the rub – what good is a rocket fast wireless network if time is wasted connecting over thousands of miles of network to a data center in Loudoun County that contains all the luscious data those 5G enabled apps want? Most people believe that 5G will give rise to a proliferation of smaller, distributed “edge computing” data centers located closer to where the app is executing over the 5G network. You want to make money on 5G? Look long and hard at the distributed database market. Some piece of software will be needed to keep the data in all those edge data centers in synch. Find a way to get around the inherent limitations in the Gossip protocol and you’ll really rake in the big bucks.

    I’ll make an offer – I’ll write a column on 5G if there is interest. I’ve had to do some research on the topic for one of my customers anyway. Obviously, my column will only contain a summary of public information.

    • I would appreciate a primer on 5G. Layman’s language to the extent possible, please.

    • How does AOL fit into the history?

      • How about the company that made Mark Warner rich?

        • What made Mark Warner rich was shuffling papers in the idiotic spectrum auctions of the Reagan Administration. A lawyer putting together consortia of dentists to buy spectrum licenses which were quickly flipped at a big profit to Bell Atlantic, et al. Completely legal but world class rent seeking nonetheless.

          After that, he was into Nextel which did well then floundered until Sprint unwisely bought the company. Now has been acquired by T-Mobile.

          • that sounds like classic entrepreneurial skill! 😉 He
            KNEW that “spectrum” was very valuable! Not everyone did!

            I think we underestimate just how much of those data centers are actually serving cellular… these days – especially in rural.

      • I don’t think it really does. These were network guys – MFS, PSINet, UUNet, etc. AOL was a beneficiary but they weren’t even founded at the time the network guys cooked up the basis of MAE-E I don’t think.

  5. I had a routine appointment with my dermatologist today. Although he is in his low 70’s, he is very tech savvy. He is now at the point where he sees patients for several weeks and then leaves to spend several weeks in an apartment he has in central England. The COVID-19 situation has sped up his thinking about giving up his sublease on brick and mortar space and going all digital. As he says, “Give me a laptop and I can communicate with my patients from anywhere in the world.” There is a secure platform for doctors to use and he says that patients could send him pictures of suspicious growths or he could view them through a virtual, or on-line, appointment. I got the impression that he has been doing some of that recently while sojourning in England. The world is changing.

    • Robotic surgery, in which a human surgeon operates a robot some distance from the patient, is one of the use cases of 5G. Obviously, low latency is important.

  6. and I have made progress on building an electronic medical record where many of my medical providers are all on that record – and I can get to that record, ask questions, make appointments, see my current meds, see test results, etc – from anywhere there is an internet connection.

    The world IS changing and data centers are fundamental infrastructure and even though they are not big employment centers – I see them like our electric grid – it does support employment – line workers, maintenance, operations, etc… vital infrastructure.

    • I was once the CTO of Cloud for a big technology company. I’m “all in” with regard to the importance of data centers. But this is a blog about “Reinventing Virginia for the 21st Century” and it’s the people who program the apps inside the data centers that count more than the data centers themselves. I’d trade all the data centers in Loudoun for one more Amazon in Arlington deal.

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