The UK data centre market remains the largest across Europe, but the Nordics are pushing hard to eat into that market share with its green-powered data centres and favourable tax regimes, so what do the different regions have to offer customers?
“The data centre market is a lot more differentiated than people realise. If you look at hyperscale, they are doing it in a similar way wherever you go. They are driven simply by cost, and that’s cost of space, power and region they want to serve," says Mark Acton, head of data centre technical consulting at CBRE Group, a real estate and property management firm focusing wholly on the management of data centres.
“That’s why you get them going to Ireland and the Nordics, because there are favourable tax regimes or there’s a large availability of cheap power, cheap land and frankly government support,” Acton told Computerworld UK this week during DataCloud Nordics.
“It’s not actually about the type of data centre per say," Acton said, "it’s very much about what the local conditions offer and what is the cost of power, what’s the availability of power and what is the cost of land and actually building in those areas?”
Essential it comes down to knowing the different types of data centres and what location suits each customer individually.
Data centre providers and operators tend to build sites across different regions “because there are a set of advantages, not necessarily one particular advantage. There are a series of potential advantages,” he added.
UK government perception
The UK government can often be found talking about stimulating the digital economy, and naturally some of that is driven by the presence of data centres.
Currently, governments across the Nordic regions, such as Norway and Sweden, are ramping up their efforts in this area as they try to give businesses reasons to move to their region.
“If people want the cloud and the digital economy to do well they’ve got to make the climate attractive for data centres. We need to make planning for data centres easier, let’s do what the Irish have done and generate the real ability to provide them with investment," Acton urged.
“The government has to be a little bit smarter about what they do with digital technology to enable it to actually happen,” he said. “One of the potential benefits of Brexit is that we could probably, if we’re smart, we could actually go ahead and make that environment much more attractive than others in mainland Europe."
Acton identifies regulatory climate and cost of power, land and the ease of doing business as key drivers for data centre business, but also recognises that more and more big businesses are going to build out regional capability wherever they can get the best price.
“The reason that Google, Facebook etc are coming over to the Nordics is not necessarily to service the local Norwegian or Swedish community but they’re servicing a very much broader region,” he said.
Meeting customer demand
One booming customer base for the Nordics recently has been the crypto currency industry, as it looks for the capability, efficient power and space to build large high performance computing (HPC) platforms.
Acton admits that the UK has an advantage when it comes to enterprise customers seeking data sovereignty however. “Are those big banks moving to the Nordics?" he asks, "no they’re not. For banks, latency is more of an issue. So being close to the centre of action and the financial hubs actually does make a big difference,” he added.
If the UK continues to provide these services effectively, there should be no reason for enterprise data centres to consider shifting to other regions. Although, “it’s about being smarter,” said Acton.
“I think in the UK, a lot of our economy is very service led as we don’t do much manufacturing anymore. A lot of our services are financial so there’s still going to be a lot of enterprise data centres based around the financial industry and I think it’s very important that our government recognises that."