Data centers continue to expand

SAN FRANCISCO, CALIFORNIA - The widespread expansion of data centers will continue this year and into 2011, according to Digital Realty Trust Inc., which cites a new research report that the REIT commissioned to look into data center owners' plans for expansion.

The locally based firm, which is one of the world's largest wholesale providers of data center space, surveys the US data center market every year.

This year's study shows that 83% of respondents are planning data center expansions in the next 12 to 24 months, while 36% have definite plans to make those expansions during 2010. Among other highlights: The top reason for data center expansions the need for additional power, and data center/ IT budgets are both projected to increase by 8% percent in 2010.

Chris Crosby, senior vice president of corporate development for Digital Realty, says that the survey findings “point to strong demand for data center space this year and next year as a large majority of enterprises expand their IT infrastructure.” One of the most interesting results of the study is that power is now playing such a large role in expansions, Crosby says.

“Another key finding of this study is the increasing importance of data center partners in these corporate expansions,” Crosby notes. “More than ever before, enterprises are turning to wholesale providers and other specialists for these data centers in order to leverage their expertise and to reduce or eliminate capital expenses.”

Michelle Bailey, a vice president at International Data Corp., points out that last year, many companies put their plans for new data center construction on hold as the capital markets dried up. “As a result, we have seen IT organizations increasingly look to third party suppliers with flexible financing strategies as a means to supplement their own aging data centers,” she explains.

Crosby cites “significant progress over the past two to three years in the area of data center energy efficiency.” He notes that, over that period, the industry has gone from power metering being the exception to power metering being utilized by more than three quarters of respondents. “These are very positive signs that companies better understand their data centers’ energy use and can make informed decisions to reduce energy consumption,” Crosby concludes.

The data center study was based on a detailed survey of 300 IT decision makers at large corporationss in North America who are responsible for shaping their companies' data center strategies. The research was conducted for Digital Realty Trust by Campos Research & Analysis. Highlights from the study were scheduled to be provided in a webinar today featuring International Data Corp. vice president Michelle Bailey and Digital Realty Trust senior executive Chris Crosby.