Comments on: Do Cheap Power and Massive Data Centers Really Matter?

By: Derrick Harris

Derrick Harris — Tue, 31 May 2011 21:04:26 +0000

Rich,

You’re right on. I think John acknowledges as much in his blog post. But there is a notion out there that it takes operating a la Google or Amazon to achieve the economies of scale necessary to be a successful cloud provider. That’s what I think he (and I) was trying to dispel.

By: Brent Emery Pieczynski

Brent Emery Pieczynski — Mon, 30 May 2011 14:21:43 +0000

When there are large power sources then large computer centers can exist just other large users of electricity. Where there is easy access to large amounts of Internet Bandwidth there will also be people to take advantage of those resources. Only after most of the heavily centralized electricity generation is replaced by decentralized power generation then the centralized data centers will be replaced by smaller-sized data centers.

By: Rich Miller

Rich Miller — Fri, 27 May 2011 21:29:31 +0000

This is comparing apples and oranges. Facebook, Google and Amazon aren’t pursuing cheap power and huge data centers because they’re not as smart as the GoGrid team. It’s because their business is different – their scale changes the economics, particularly when it comes to power. Facebook and Google started in colo space and/or wholesale data centers. It’s only when their operations grew that the economics tipped toward having their own facility and optimizing for energy efficiency.

Going forward, there will be cloud players that will do fine in colo. That’s why Equinix and the data center REITs are prospering from the growth of cloud computing.

There will also be huge platforms that compete based on the benefits of scale and cost. Each type of cloud provider will use the infrastructure that suits them best. Oregon and North Carolina won’t put Silicon Valley and Ashburn out of business. There will be lots of data centers in all these places.