Recession driving data center boom

Robert Clark
25 Mar 2009
00:00

This may be a once-in-a-lifetime economic bust, but no-one seems to have told the data center guys.

In Hong Kong alone, Equinix, PCCW and Rackspace have all expanded their data centers in the last 12 months.

So has NTT Com, which officially opened its new 212,000 sq ft center yesterday at Tai Po in Hong Kong’s New Territories. It picked up the seven-story building when it acquired APT Satellite last October for HK$161 million.

The launch unfolded in the usual fashion, populated by company suits, customers and young lasses in short skirts. The ceremony was one of those that ended with a brief explosion as the VIPs held hands and streamers fell from the ceiling. The hosts bowed deeply to the consul-general.

But before that, visitors were admitted past the security turnstile through an airlock (or “air curtain”) that flushed out impurities from clothes. The equipment room was helpfully signposted – the racks bore a sign that said “racks” and the server cage was marked “cage”. The UPS hummed away in the basement.

True to the traditions of these things, NTT Com CEO Wasai and regional honcho Moribayashi disappeared immediately after the ceremony, so we don’t know what they think.

Their company owns 27 data centers worldwide, yet for all this effort it stills depend on voice for two-fifths of revenue. It’s a sunset business. The segment declined 7% in the nine months to December 31, helping operating income sink 11%.

By contrast data center specialist Equinix boosted revenue 68% last year, widened gross margin eight points to 65% and made a $132 million profit. It expects 24% growth this year on similar margins.

It may not be recession-proof, but it’s certainly recession-fed. No wonder telcos are joining the data center boom.

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