BroadGroup Says New Locations for Data Centers Need to Offer Compelling Value

London, 7 October 2011 – Location of data centers is now a critical factor for due diligence when deciding on investment, build or outsourcing to third parties, says BroadGroup Consulting. http://www.datacentres.com/consulting
 
In a new paper, the company identifies location as the key aspect of data centre build and how this may change over the next fifteen years of the expected useful life of the facility. It also suggests that the attractiveness of a location may suddenly decline, because of power cost and availability, changes in taxation, legal and regulatory issues or reliability.
 
“Simplistically, a location needs to have all the ‘basics’ in place – telecoms, power, reliability and legal environment,” comments Steve Wallage, managing director of BroadGroup Consulting. “Such issues are often far from simple – for example, power issues include such factors as quality, price, availability, diversity, renewables and sourcing.”
 
The BroadGroup paper cites Scandinavia as a good example of meeting the requirement for long term certainty with some countries offering long-term fixes on power pricing.
 
It also warns that the key challenge for new locations is an “inherent resistance to change” in the data center sector which has resulted in a concentration of facilities in a relatively limited number of metro markets.
 
The company suggests that new locations must offer compelling value, whether through
lower costs or a particular advantage such as access to renewable energy and believes that many new locations will emerge over the next few years.
 
BroadGroup Consulting has developed extensive expertise in conducting due diligence on behalf of data center operators, users and investors in executing successful business and new market entry plans. It has also worked with many government and investment agencies around the world in ensuring their locations are attractive and in developing benchmarking and economic value-add tools to provide insight into their relative competitiveness.
 
“Clearly Location owners and agencies need to focus on delivering a very well defined value set to attract investors and enterprise outsourcers,” said Mr Wallage. “They also need to provide a vision that conveys a sense of cost stability and power supply over the coming years in order to convince investors to move outside traditional metro markets.”
London, 7 October 2011 – Location of data centers is now a critical factor for due diligence when deciding on investment, build or outsourcing to third parties, says BroadGroup Consulting. http://www.datacentres.com/consulting
 
In a new paper, the company identifies location as the key aspect of data centre build and how this may change over the next fifteen years of the expected useful life of the facility. It also suggests that the attractiveness of a location may suddenly decline, because of power cost and availability, changes in taxation, legal and regulatory issues or reliability.
 
“Simplistically, a location needs to have all the ‘basics’ in place – telecoms, power, reliability and legal environment,” comments Steve Wallage, managing director of BroadGroup Consulting. “Such issues are often far from simple – for example, power issues include such factors as quality, price, availability, diversity, renewables and sourcing.”
 
The BroadGroup paper cites Scandinavia as a good example of meeting the requirement for long term certainty with some countries offering long-term fixes on power pricing.
 
It also warns that the key challenge for new locations is an “inherent resistance to change” in the data center sector which has resulted in a concentration of facilities in a relatively limited number of metro markets.
 
The company suggests that new locations must offer compelling value, whether through
lower costs or a particular advantage such as access to renewable energy and believes that many new locations will emerge over the next few years.
 
BroadGroup Consulting has developed extensive expertise in conducting due diligence on behalf of data center operators, users and investors in executing successful business and new market entry plans. It has also worked with many government and investment agencies around the world in ensuring their locations are attractive and in developing benchmarking and economic value-add tools to provide insight into their relative competitiveness.
 
“Clearly Location owners and agencies need to focus on delivering a very well defined value set to attract investors and enterprise outsourcers,” said Mr Wallage. “They also need to provide a vision that conveys a sense of cost stability and power supply over the coming years in order to convince investors to move outside traditional metro markets”

About BroadGroup Consulting
BroadGroup Consulting is the leading research and investment advisory company in data centers. Working with a range of clients including owners, operators, investors, financiers and professional intermediaries worldwide, it delivers incisive advice and research based analysis to support critical business, market entry and investment decisions. Founded in 2002, BroadGroup is headquartered in London, United Kingdom and has associates in Europe, South Africa and Asia Pacific. For more information please visit www.broad-group.com / Email consult@broad-group.com

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Philip Low

MD

BroadGroup

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