What is a Hyperscale Data Center? - Data Center Fundamentals - Data Center Investing

Want more Hyperscale content? Sign up to receive our free Hyperscale Data Center course once it's live: https://lp.datacenterhawk.com/hypersc... 📊 Get more market insights here: https://datacenterhawk.com/analytics?... ––––– What is the cloud?: https://www.datacenterhawk.com/blog/w... Video with Tag Greason, QTS's Chief Hyperscale Officer: https://www.datacenterhawk.com/blog/h... ––––– With billions of people and tens of billions of devices online today, there’s never been a bigger need for computing infrastructure and data facilities. Hyperscale Data Centers: The Way of the Future With billions of people and tens of billions of devices online today, there’s never been a bigger need for computing infrastructure and data centers. What’s paving the way for companies to scale operations faster than ever before? Hyperscale data centers. What Is a Hyperscale Data Center? A data center is a building that houses an organization's servers and IT equipment. A private, or enterprise data center serve strictly as a resource for the businesses that own them. A multi-tenant, or colocation data center is used as a means of providing infrastructure services to the public. When people refer to hyperscale data centers, they are usually referring to both the customer and the size of the facility. Tag Greason, Chief Hyperscale Officer at QTS, defines hyperscale companies as those that build or lease 20+ MW at once or expand to that level over time in 1–3 MW increments. Only a small number of companies make these large commitments—primarily cloud service providers like Amazon (AWS), Microsoft (Azure), Facebook, and Google (GCP). Several dozen others, including SaaS companies such as SAP, Salesforce, Workday, Uber, Lyft, and Twitter, may grow into the 15–20 MW range over time. A hyperscale data center is either built by a hyperscale company or designed specifically to meet one’s needs, often in partnership during the pre-leasing process. The Rise of Hyperscale As our world becomes increasingly technological and the demand for storage and compute services has grown, so has the need for facilities to handle these needs. Two trends have driven the need to large-scale IT infrastructure. When cloud computing platforms began to emerge in the late 2000s, they acted as demand aggregators for businesses who were looking to convert their on-premises IT workloads. Cloud platforms allow users to provision resources and scale quickly, often remotely and near-instantaneously. And the companies who provide these services could then forecast future growth and “buy in bulk” to meet that demand. Additionally, the rapid rise of SaaS, streaming, and social media further drives growth in the industry. All three of these types of companies need massive amounts of storage, compute, and bandwidth to meet their customers needs. Who Are the Hyperscale Users? There are now three times as many large-scale data centers being operated by hyperscale providers as there were in 2013. And it’s not hard to imagine which companies might be at the top of that list. Amazon, Microsoft, Google, and IBM all have hyperscale data centers in every major region of the world, and other top players like Facebook, Apple, Oracle, and Chinese cloud giant Alibaba aren’t far behind. These A-listers can take down over 70 megawatts and hundreds of thousands of square feet at a time. Next in line are companies with lower present requirements, but who still want the ability to grow a few megawatts at a time. Among their ranks are companies like Salesforce, SAP, Dropbox, Twitter, Uber, and Lyft. Hyperscale Over Colocation? As noted above, the largest consumers of data centers all employ a build and lease strategy. This is dependent on many factors, such as timing, cost, future needs, and others. These colocation providers have become increasingly creative in pursuing hyperscale companies, ranging from basically being the development arm for them to designing to their specifications or delivering just a powered shell and letting the user provide the internal equipment. Smaller, though still hyperscale, companies primarily lease from colocation providers. These companies act more like traditional colocation customers, but typically have needs to pathways to growth over time. The Future of Hyperscale Hyperscale companies continue to dominate the landscape, driving design, location, and cost for the entire industry. Though the specific companies may change, the underlying trends of digitization, IoT, and data creation will persist and fuel the need for even more data centers in the future. And a major portion of these will be hyperscale.