April 30, 2014
The other evening I was sitting in the Crosby media center futilely throttling my clicker in a vain attempt to find something worth watching. Having run through all the DVR anb100 plus channels a couple of times, I had finally resigned myself to watching “Crocodiles, The Misunderstood Reptile” on Animal Planet when Mrs. Crosby popped in, scooped up the remote and flipped the channel over to PBS. I don’t know about you, but the last thing I watched on public broadcasting was Sesame Street, so I politely asked the Mrs. what program could PBS possibly offer that was better than watching an alpha predator devour a wildebeest. Although I didn’t catch the name of the show—I did note that everyone was British–she replied in that way that women do that lets you know that animal on animal carnage is no longer among the evening’s viewing options.
The show was all about these English people who live in this humongous manor house and their servants. These folks are what you might call “old money”, and they must have lots of it since all they do is sit around all day and wait for Jeeves the butler to help them get dressed for dinner. None of them even work. During the episode I saw one of them wanted to get a job and they all looked at him like he had a third eyeball. Anyway, the whole crux of the story, as best as I could tell between catnaps, was that although the world around them was changing, they just couldn’t adjust since they had always done things the same way. In between nodding off, it struck me that this is kind of like the data center industry today.
For years data centers have been primarily focused in six or seven major cities/areas (New York Metro, Northern Virginia, Chicago, Dallas, San Francisco and Phoenix) due to a couple of factors:
– A large majority of data center customers can be found in the Fortune 2000. Many of these companies are located or have major operations in these areas.
– The business models of the providers themselves. In order to achieve the economies of scale needed to offer data center space at rates low enough to bring in customers, they are forced to build sites large enough to spread their costs over multiple customers under the same roof.
Although a number of enterprise-sized companies are headquartered in these major metro areas, the “big six/seven” markets represent only 2% of the country. The need to provide data center space to the other 98% is giving rise to a new group of cities–anyone visited Minneapolis lately–becoming data center meccas. These new entrants into the marketplace represent a further sub-division of the country that provides businesses more alternatives for locating their new facilities. Unfortunately, the large “economies of scale” models used by many of today’s wholesale providers are placing them in the same position as those PBS British manor residents—the needs of the customer are changing but they can’t adjust to meet them. For many of these providers of monolithic facilities, their customer’s request for data centers in new markets are greeted in the same fashion as with the guy who said he wanted to get a job.
This “PBS predicament” isn’t unusual. Many industries have seen companies that have always done things the same way—did someone say General Motors—give way to more nimble customer-centric competitors. The changing nature of corporate computing driven by technologies like the Cloud and Big Data are leading customers to insist on having their data centers closer to them or in strategic locations outside the markets that have traditionally defined the industry. What this means for those providers that cannot adapt is that offering a customer in Ohio data center space in Chicago, because it’s the nearest major market, will have them looking in the mirror to check for their own third eyeball.
Certainly change is hard. Many successful companies find themselves slaves to the “we’ve always done it this way” mantra. The need for change has come to the data center market and the choice is clear—adapt or become the industry equivalent of one of those PBS shows, without the classy British accents.