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Hyperscale Data Centers and Industry Expansion

By: Kayla Matthews on July 22, 2019

The data center industry is booming. Indeed, various things contribute to its success, such as how people are more reliant on streaming media and e-commerce sites, both of which need data centers to function.

However, a significant amount of evidence shows that hyperscale data centers, in particular, are furthering the industry's expansion.

What Is a Hyperscale Data Center?

A hyperscale data center is one that has the required resources and infrastructure to efficiently scale up on demand. Also, they typically contain at least 5,000 servers and span more than 10,000 square feet.

Many hyperscale data centers — such as the ones Google owns and operates — are so carefully controlled that they include artificial intelligence (AI) components. They keep things running smoothly without continual human involvement.

Hyperscale Data Centers Will Soon Handle Most of the World's Computing Traffic

According to a Cisco white paper, traffic from hyperscale data centers will account for 55% of all traffic by 2021. Moreover, the servers in hyperscale data centers will account for 53% of the total amount by that same year. Statistics like these help people recognize that data centers will continue to be relevant for the foreseeable future.

Also, as the equipment brands that work with hyperscale data centers develop better offerings to cope with the demand caused by that increased traffic, those offerings will probably trigger a ripple effect. Then, smaller, less scalable centers that may also want to avail of those products benefit, and the industry at large gets better as a result.

Hyperscale Data Centers Acting as Economic and Skill Boosters

The increase in hyperscale data centers contributes to economic prosperity for the markets that contain them or have geographic advantages that make those locations exceptionally well-equipped. For example, the Dallas-Fort Worth (DFW) region is one of the largest data center markets in the U.S., and it has 2.99 million square feet of commissioned space.

Analysts also say that although DFW was not historically a frequent choice for hyperscale data centers, things are changing. For example, Google recently started building a gigantic location near Dallas.

In places like DFW and elsewhere, the arrival of hyperscale data centers can stimulate the economy by bringing more people to those destinations. Moreover, they are often mentioned in headlines due to their massive sizes and capabilities. If individuals read about those facilities and are simultaneously thinking about future careers, they might realize that data center knowledge could translate to lucrative work.

Then, regardless of whether those people work in hyperscale data centers or other facilities within the broader sector, they benefit the industry at large by getting trained and applying their skills.

Hyperscale Data Centers Are Driving Colocation Revenues

It's also notable that a 2018 report about colocation center revenues showed that hyperscale data centers increased revenue for those facilities. More specifically, revenues from center operators grew by 24% in the wholesale market, and 16% in retail. The revenues from hyperscale data centers that depended on colocation providers accounted for more revenue growth than other service provider customers, including enterprises.

The rise of colocation centers benefits the overall data center industry, and the revenue growth mentioned here helps those centers to continually prosper. Additionally, this trend could support the ongoing moves toward expansion and transition in the United States.

According to some perspectives, the United States' current transition period in began in 2001 with the burst of the dot-com bubble. Recovering after events like that requires going through a deployment period, which may include exceptionally high levels of innovation. Colocation centers are undoubtedly helping that happen already, and they'll continue to do so as hyperscale data centers help their revenues.

Hyperscale Data Centers Could Encourage the Data Center Industry to Become More Sustainable

Many people repeatedly bring up how the data center industry collectively uses an enormous amount of energy. They raise concerns about how it's harmful to the environment, and that there must be a push to explore more sustainable options. It seems likely that hyperscale data center operators could lead the way in facilitating that shift.

A market forecast report from Arizton Advisory & Intelligence expects the worldwide hyperscale data center market to surpass revenues of $128 billion by 2023. The publication also mentions how the top hyperscale providers will totally rely on renewable energy for their data centers by 2023. As hyperscale data center operators look for methods of increasing sustainability, their conclusions could apply to the whole data center industry

For example, Facebook uses 100% renewable energy for its data centers already. However, the social media giant will mount a solar array on the roof of its first custom-built data center in Singapore. It's also working with local contractors to determine any other sustainable solutions that may apply to this project.

Efforts from hyperscale data centers to become more sustainable will prove to the overall industry that it's possible to think creatively and operate in ways that protect the planet while meeting the data-centric needs of today's citizens.

A Beneficial Relationship

It should now be evident that growth and progress in the hyperscale data center sector has similarly significant impacts for the entire industry. As more hyperscale centers get built around the world and keep implementing the latest technologies, others can learn from those approaches.

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