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Recession Hasn’t Killed Data Centre Demand

Tom Jowitt is a leading British tech freelance and long standing contributor to TechWeek Europe

Is the recession cutting demand for data centre space? Not according to analyst Nick Mayes of PAC Consulting.

Demand for UK data centre capacity is still soaring as enterprises focus on costs and struggle to deal with increasing regulatory pressures over emissions. This, says an industry watcher, is driving them to outsource their data centres to specialised providers.

IDC has been warning of pressures on data centre capacity for a while now, and has also previously said in-house data centre capacity is expected to shrink over the next few years. This view was backed up Nick Mayes, senior analyst at PAC Consulting

“We think there is huge pressure on data centre capacity at the moment,” said Mayes, speaking to eWEEK Europe. “One of the problems in the market at the moment is that a lot of new capacity that was planned over the last 12 months, has been put back because of funding challenges. That caused even more pressure on data centre capacity.”

“Many large organisations in the London area are finding it difficult to locate local data centre capacity, and so are now looking further afield,” Mayes said. “There is so much draw on the power grid around Docklands, that people are having to further afield. We are seeing them look around the M25, but customers want their data centres within driving distance. We are seeing them look along the M4 corridor and even as far afield as Northampshire.”

Headcount down, data up

“A lot of companies have also reduced headcount in last 12 months, but the amount of data they have to store and manage has continued to grow,” said Mayes. “This, coupled with factors such as energy efficiencies, compliance and the rules on carbon emissions that are coming next year, means that companies are facing massive pressure from all sides. The easiest way forward for many of them is to work with data centre specialists rather than do it yourself.”

“Employing a third party supplier to build or lease space makes a lot more sense for end users in the current climate, when compared to the capital and long-term planning required support an internally-developed site,” concluded Mayes.

He also pointed that technology vendors, such as Microsoft and Google, are rolling out new sites to support the delivery of new software-as-a-service and cloud computing offerings, as client interest in more flexible pay-as-you-go models is piqued by the current pressure on IT budgets.