What is a Data Center? – Data Center Fundamentals

welcome to hawk podcast 28 today is the first in a series of data center fundamentals podcasts which goes along with our blog series which you can see am dead center comm slash blog but today we're gonna answer the fundamental question what is a data center [Music] okay so what we were talking about today is a video / audio presentation of a blog series we've done yes data center fundamentals which the intent of the Rays on that date I don't know how to pronounce that word D apostrophe e tre reason reason for existence so you pronounce it is we are our reason for existence is to help people make decisions good decisions quickly yeah and so that's the reason we put together that blog series that's the reason we're doing this podcast series so again it's intended to give people a very solid foundation in industry and again help them to make good decisions quickly so as we're talking about today part one is what is a data center so you've heard that story about Vince Lombardi you know they had team has been winning and then they lost and so the next year when they kicked off training camp he said he opened a training camp with gentlemen this is a football yes and it was like guys who had somebody been playing for a while something had me playing for a while and the point being you know we need to master the fundamentals yeah so hopefully what we're doing here is helping you whether you've been in the industry for a while or not or you're new you know to really make sure that we've got a strong foundation of knowledge on the data center market yeah and it goes back to when I started in the space I mean it took several years to get up to speed on what was happening in the data center industry and to get my mind set built around okay just a basic framework around you know what is what does the data center industry how does it operate etcetera so we want to create content that helps people to that faster and there are people getting into the space still today so you know while we have people that listen to our content that you know you brought up earlier they're talking thinking about absorption levels and you know so much I would say more granular topics that are very specific and in the weeds of our space you know we wanted to simplify this to give people a very clear picture of this industry and what it is so that is the purpose or whatever it is you said and I'm not going to drag in that's a tough one of what we're talking about yes as you said this is a the companion feature to our vlog series that's already out there if you go data center hakam slash blog there's a little drop-down click fundamentals and they'll give you all those quickly yeah so check that out we'll put that in the show notes some I'm there really well you know we've done we've done some our content you know goes from market updates to you know what's happening with different data center operators to invest I mean there's just all different things that we do so when we did that it was a very like simplified version but I'm actually really like proud of that and I've had very little to do with this we have a team marketing team and a blog writing team that was focused on this and I did a really good job so if you are looking to get into the space after listening to dr. nuts or dr. Liggett you can go figure you can go read those blogs and they will I'm gonna go one step further if you listen to this podcast and you do not want to get into space well something's wrong guys I don't know a better salesman for the industry than mr. David oh gosh my and I'm just is just so thanks I'd car operator hear something before we do that I wanted to spice up the podcast set here with some color or sponsored sponsored by Lucroy I sure wish we were we spent so much money on it this is the Hibiscus Lacroix I think it's delicious is one of my favorite flavors so I want you before we started to power rank your top five sparkling waters different brands different flavors this is grand / flavor okay I'm going to go with so I actually drink the Kirkland brand a lot which I think is maybe the cheaper version and look right what's you got your frugal for gala tea bona fides a well-established very good so I will typically that's like so I don't know if that's like the best but I'd say that we will drink the topo chicos that's a big you know and I don't know the flavor toboe I typically just like like the regular to the lime I'm a big like lemon lime type guy so you know I'm and pretty basic so so probably those two would be at the top of my list as it gets like beyond that I don't really venture into the sparkling water world much more so Kirkland one yeah which is what Christ motivated yes so then Lacroix I would say the stock price motivate know we're like bottles and yeah yeah and actually when I drink those I kind of feel a little woozy yes like in fact we were story during this quarantine time we've had even times we were going out like meet our neighbors and in the front yard just hang out and talk socially dissing of course and the other night I was talking about you know I was like I think I just wanted drink a topo Chico but I was like I didn't know I want to take this out there the bottle so I pour it into a cap and just took it that way versus cuz I just carrying that ball around you just look kind of I'm not fan of that yeah now anybody's worse but I wasn't a tank top in that it would be better it would've been better what are you almost spindrift guy which I see spend different kind of bougie in himself it's more expensive like the real fruit juice in it yeah the raspberry lime is really good that's the flavor of spin i go grapefruit topo yes also very good yeah i had it you know until a week ago yes but the costco that we get our business supplies from yes business was out of the Kirkland yeah they their supply chain management baffles me well whatever time well sure but Co doing water but they only had the and they only and they only had Lacroix they didn't even have the regular Lacroix like lime yeah blue yame they only had the fans of the core which again there's some method to their madness I know there is but I can't figure out and we can move on from sparkling water talk but I can't figure out the you know they put the like 24 pack or 36 pack and the way they split up you know hey we'll put 10 limes in there 12 lemons in there and whatever and I'm just I just wish they would do you know bulk in one flavor because I like we have a ton of lemon drinks right now in our fridge at home that I was never will drink yeah and I was forced coerced and strong-armed in my pack absolutely that's watermelons which if you if you like those stopped listening it can't be friends though watermelon Lacroix is so so divisive today the lemoncello one interestingly enough multiple people ever marked that it tastes like vanilla coke interesting remember two vanilla coke came out how mind-blowing that was yes big I was like you can put other flavors and coke and think I carried away as they always do better the initial there was a several months of of ideological purity when it came to coke flames right and it was it was a fun time it was a really sweet time alright hey what talk quickly about you know one of the things we keep an eye on or seeing is just the sheer amount of cash Ola greenbacks clams Washington singles you know what I mean bullion that is base yeah you know and four notable in descending value order cakey our investment firm yeah drop in one billion dollars with the be to basically form a new company global technical ready to you know pursue that hyper scale business in Europe say be pulled down like another eight hundred bucks or a hundred million bucks in like new debt aligned extended their credit line by five over seventy five million bucks to your point another three and twenty men bucks and funds from three different investment groups so like taken holistically or collectively like what does that tell you means actually given all that everything else is going on is based yeah I mean if I mean those are all data center operators or developers that are specialized in this industry and so I think it you know tells me that number one there's definitely capital and investors that are looking to get into the space so some of those groups that you mentioned are you know capital partners that have been invested in this industry for a while I'm not sure if all you know maybe some of those are new to the space but I think we are seeing people look at this industry differently for enough reasons number one even before the pandemic you know this industry was growing and has significantly grown over the last you know three to five years but number two in the midst of a very turbulent economic period this data center industry has stayed pretty consistent if not grown so and I think people really believe that the fundamentals of the business are strong and will be strong moving forward despite what the gyrations of the market will be so you know that's what it tells me I mean and I think we'll see other capital sources you know in the future coming into the market it's not an easy market to get into because so expensive I mean which is probably a good thing but we are seeing more and more capital entering the space yes as one of my favorite poker commentators Vince Van Patten used to say the price of Poker is going up that may raise the blinds and you see that you know if you can't just you can't just bring ten million bucks to table anymore right right you've gotta bring a billion or you've got a you know have a plan sure and you know you look at the size of deployments and the size of new builds continues to grow yeah and so as you said it continues to up the ante has it worked I can make poker metaphors all day by the way you know I love to gamble yeah copious amounts is you know we could probably cut this out if you want to keep it in if you think it's a human interest story the other day we have to now sign up for our CrossFit gym cuz it's smaller and whatever cuz of covet and you know if you miss an appointment that's not good why was the first person in our gym to miss a booked appointment did you miss before I did yes I missed on the Thursday Friday differently reason I missed was because I had a friend text me at about 9:30 asking if I wanted to play poker yeah and I said yes this is p.m. and didn't end up finishing until about 2:30 it's actually would you mind I did win good which was nice it's it's really rough to stay up till 2:30 and lose money you are yes that's just I'm paralyzed to ever in a yes I did Michael I think that's hands-down the latest I've stayed up in easily the last five years maybe 10 yeah I was surprised so poker all right so David let's get started let me pose to you let's Linda mental existential question no David let's get started take think all right let David let's get started so fundamental question we are trying to answer today is what is a data center read it off of that thing so Mike and I met earlier actually and we we had some well yeah no I mean we had someone straight we wanted to very like we wanted to simplify this answer and because this for those that are in the industry this this thing could be it could be a paragraph oh yeah so we're really trying to be a whole podcast so go figure what was all right so David let's get started let's the question we were going to answer today is what is a data center yep a facility that houses digital infrastructure no so that's like the most basic definition that we could build of what is a data center because you know you have some companies that have their what I'll say data center in a closet in an office building that they that there are offices in and then you have a that's one side of the scale and on the complete opposite you have companies that have purpose-built buildings that are highly secure highly redundant and you know they're they're hundreds of millions of dollars and that was what they would consider their data center and then you have everything in between and so I think what at its simplest you know basic definition I mean this is it is the engine that allows did you know company's digital infrastructure to run and so that is really what we have focused on here at data center Hawk and you know in my career for the last 15 years or so on what those facilities are how they operate how they've changed where they're located you know why they're growing the way they are all those things are what you know we're doing to focus on the industry yeah again if you're coming you know the lot of folks who come into the data center industry are coming from office real estate market extra real estate market or or technology right side so you know I think what we want to do let's talk about what are some things that are defining or distinguishing characteristics of the data center as a real estate class yeah and we'll talk about some of the building and the technical side of it as well but you know again assuming some people have most people have a at least a working understanding of it of an office sure or a even consider a residential real estate transact you know and there's there's jumps you can make that will be kind of pull someone to you know the data center yeah so this is a good time for me to talk about just briefly how I got into the space and you know I originally started in real estate with CBRE so a global real estate company and I got into the real estate business to focus on the office market about a year in I ended up joining a team that was self declared focusing on data centers and so this was still back when the genesis 2007 yeah doesn't 8:00 yep yeah and right before actually the capital markets collapsed and we had the Great Recession but I was focused on you know how the data center industry how to show clients our clients what options they had investor markets when I started so the very very first thing I got was like this table sheet of paper table with four different data center facilities and we were working on a 4 megawatt requirement so people in the space know that's that's a big lot of capital goes into and he's probably a hundred to 150 million dollar decision and I was tasked with figuring out hey where should this thing go based off of different criteria related to each data center and at the time I didn't know anything I did not know the difference between a megawatt kilowatt a watt I didn't know the difference between you know what power costs how those implications on data center location decisions I didn't understand anything with redundancy I like saw N and n plus 1 and 2 in and I was really confused and so you know so that was my entrance into into the market a lot of people get into the data center space by accident and what they you mentioned the technology side of things the real estate side of things the Investor side of things whatever you know Road you've come from you you get in and you realize this is a market that's not going anywhere and it only seems like it's gonna grow and so part of what you have to do very quickly is build a framework around what is this industry that we're in what makes it go and so today we want to talk about it's like the most basic thing we can to boil it down so that you understand just the asset class alone of a data center industry might mention you know other types of commercial real estate the office market the the industrial market the retail market the multifamily market the data center industry class is a commercial real estate market that is smaller but highly capital intensive and that makes it a big that makes it a big difference between the office market in the industrial market whatever it might be that might be a bigger market that typically cost ten times more in the data center world to build a facility than it does to build an office building so those are some of the initial characteristics about the data center space and a data center loan that I think will make that should make people's ears perk up if they're wanting to get in the space and recognize some of the differences alright so when you're buying a home what is the very most important thing pool location Location right okay so that's right and it seems true the data center so talks about you know what makes what goes into selecting location for data center if you're going to build one or Cole okay sure for example so and and you know what are some of the different characteristics that would impact them yeah so people on the is it porifera peripheral preferred base periphery thank you of this raised on dippity of the space will ask questions like well can't you just build a data center anywhere that's one of the you know short answer is yes sure and it's always said also build a you know like a pool anywhere yeah or an airport it just it costs time and money and so and what we've seen you know organizations really try to understand is how well okay ssin impacts the business applications that are the digital infrastructure that is stored within these facilities and so that has dictated a lot of location decisions and every company is different every company has different risk profiles every company has different things they're trying to accomplish with their data center location and so that is just you know you can build data centers anywhere but you've got to get power there you've got to get infrastructure there connectivity you know you have to get labor there people have to work there it's different than an office building so you're not gonna have tons and tons of people hundreds and hundreds of people that are running these facilities but you will have twenty to thirty to forty and they need to be skilled they need to be people that understand the mechanicals and the electricity side of things and and so all of that is that's a labor challenge you have to fix so so location matters you know one of the other things that we talk about a lot is you know just how they need to be in areas that are free from natural hazard risk and you know there's certain every company has a different risk profiles as I said earlier but there are some typical things that define where data centers are located and if you're in the space you know what they are but if you're not it's things like hey wants to be free from you know you know proximity to an airport now you may hear things like it's outside the hundred-year flood plain sure or it's outside the 500-year sure and if you're somebody this new space just think I'm gonna go invest 10 20 50 100 150 million dollars whatever the number is or a billion dollars yes into somewhere a location so I need to do due diligence around that location to make sure that it's as risk-free as possible you know areas outside of hurricane zones torn you know areas that could be risk to tornados I mean there's all those things that that go into that decision-making process and as I mentioned before there have been some you know there have I would say some lightening of what companies will feel comfortable about being close to but for the most part if a company's gonna go invest that money they want to know that they're outside of those risk areas yeah and that's and I think that's you know some of the the fundamental pieces though talking about the fundamentals and if that's a got an intro level understanding you know the layered on top of that if you're a data center company who is looking to sell build and sell the space you know you want to also understand you know where your potential customers want / need to be and that's really that the question everybody's answer always is where the the customers especially the larger customers where where do they want to be and we're gonna go build there you bet and so it's a real a science on guessing game it's a very highly scrutinized science with some you know intuition / relational underpinnings yeah definitely yeah and you got it like and that's exactly why you know our company exists to help with those decisions and understanding market characteristics and pricing and all the things that it takes to make that decision faster and easier so totally agree so location is is a huge factor with all the things you mentioned you know secondly is kind of understanding how these things are powered because it's different then like I said we're gonna contrast with an office building which needs power and you know maybe a backup generator for a tenth of the capacity or less you know talk to how that how that's different in a in a data center facility yeah I mean one of the reasons that you know data centers cost so much money is the equipment that it takes to manage them or run them specifically related to the power so you know these are facilities where servers are that produce you know that need power to run efficiently and need a lot of power to run efficiently you know I think the last set I saw was that that data centers globally used three percent of the world's power and that's a pretty staggering stat if you think about it but all that is boiled down to facility power use so you know these facilities obviously are you know connected to they have transformers they're connected to UPS systems they have backup generators that will support the facility should the power go out you know these are fed by you know large substations you know in both suburban and we're area so you know power is the name of the game when it comes to the data center space and actually one of the things that would also add is we have seen certainly an increase in renewable power serving this you know industry in this asset class and I wouldn't say that was the case you know seven to ten years ago so even though the market is using significant amount of power not just in the US but across the world I think there's companies that are making some you know a lot better decisions when they think about hey how are we powering these data centers but but the facility itself is heavily tied to how much power can come into the facility and then how much sellable power is there certainly in the in the colocation space is to talk a little bit more about how they get the power there how that's different then again the building we're in today and then the backup piece is on a generator side or the battery side as well yeah I mean so basically you know you're gonna connect to so you know every every one of those buildings will have power fed to a by a substation and as that power is coming in to the from the substation to the facility you know that powers just broken down from you know higher levels of voltage to lower levels and and then basically these facilities are fed by you know UPS systems that are you know allowing for the continual running of these servers to take place as we mentioned you know what happens if the power goes out sometimes power you know goes out and so they will have you know companies will invest in generators to typically like diesel power generators to support the facilities in the instances where that takes place and so you know I would say that does not happen that happens very little in our space you know now like just with the ewa with the way that the companies themselves that own facilities or the data center operators are building these facilities now you know there's power typically like it never goes out and there's testing like weekly monthly annually that allows to make sure that these systems work correctly yeah any you make a good point about you know these buildings are designed in some of the other stuff we'll talk about to literally never ever lose power or lose connectivity and so in one of the reasons that is again you know because I want to look at Instagram whenever I want and I don't want that access to Instagram to ever be interrupted I say that half-joking but that is true and it's not that's not a life or death situation and but there are some extremely critical and you'll hear data centers often referred to as critical infrastructure and there are plenty of applications that run on data centers that are legitimately critical legitimately life-and-death it could be you know whether that's self-driving cars or some type of you know system that manages something that people's lives depend on yeah run out of data center and so you know it's important to understand that these buildings are designed to be able to go in that business agree you know any who we talked about it we joke about this like hey what is the cloud because you see that a lot you see a little cloud icon like IBM commercial the tournament yeah just take a picture and it just it's literally people look up when they say like it's actually physically vertically above us yes we know or we're trying to educate in the way that that all of that information the vast majority of it is in an actual data center somewhere yeah you know you take a picture you upload it to excite Instagram that's on a data center yeah server somewhere probably multiple locations and then able to be loaded back up to a separate device you know on demand basically yeah just I mean if you're new to the industry as you know this would be a good thing to write down I don't say that very often oh my gosh peasy ler as the cloud grows the data center industry grows yeah I mean so you will hear like well hey you know if it's in the cloud I mean won't that make the data center industry like less important or go away certainly I mean if you if you look at the numbers that we have over the last several years that certainly has not been the case and I think the cloud is growing yes those cloud service providers are not building all their own space sure so I I guess you know the this is a very unique market in the fact that you know you have some changes in technology the way people are using things but it's continuing to grow even as though I was at lunch a socially distant you know lunch yesterday and one of the I saw someone at the at the lunch we were talking and about the data center in industry and said yeah but everything's getting smaller than space right you kind of like made a joking you know comment and I was like not really I mean technology gets smaller over time but as you use more of it you know that the industry is actually grown so it's a those are some misconceptions that can take place on the periphery periphery I'm again I just that are easy to yeah you know the mathematics of it are just never ceased to blow my mind of like you can literally record a 4k video on your phone it's a minute long right yes a it's a you know whatever that is 2 megabytes 10 megabytes of information that's got to go somewhere and and the fact that you can do that so easily is just I think the iPhone probably is driving the expedition's yeah sure the data center growth problem was more to the iPhone than any other device sure people could just take and then expect to access information that other people would take sure so if again we're on record consistently on record being extremely bullish on the industry but you don't have to look any farther honestly than your pocket to understand why this shirt is gonna give me there's some very like easy to understand like use cases that are happening it's not like I have to explain some unique business case it's like what you can watch your kid on your iPad right that no rat tweet that like my hand in tweets that happen that's right David sits on his throne that's right alright so let's talk about the connectivity piece you know how this information that's stored in the data centers how does it get to other places more specifically I'm gonna keep coming back to this because it's the most yeah tangent or you guys to your phone yeah so you know data center data centers are built with like connectivity in mind as it relates to fiber providers like different networks the things that it takes to you know connect business applications from one facility to another and and these are you know Metro fiber routes these are dark fiber routes so you know at its core a data sir has to be a connected facility it has to be something that allows businesses or you know consumers whoever it is to do the things they want to do in an easy fashion so the more fiber providers at a facility the better the more network providers located at a facility the better and that just speaks to you know how are how businesses communicate with each other and with themselves and so you know all of these data center facilities will have a connectivity component to it and you are able to do things like you know from your physical space if you're in a colocation environment which we'll talk about but you're able to actually like utilize multiple fiber providers so just depending on you know your level of expertise in the space but if you're if you're basic you know this is a data storage building that just has a lot of connectivity fiber network you know in that facility itself yeah just not wanting to take anything for granted here when you say fiber you mean fiber-optic cables yes and so you know for since electricity was invented or whatever to say it's bear with me you know power was or information was transmitted through like copper turret lines and it still is because it's an electronic impulse that pops up and it communicates information and fiber is just the next generation thereof instead of being an electrical impulse it's a light impulse that travels on these literally glass tiny little tubes little tubes that transmits the information and again there's you can read you can go down rabbit hole about copper versus fiber but when you say fiber it's not you know people don't need more brand in their diet its fiber optic cable I do which are by and large you know certainly connecting with other non data center sources but also within the data center yeah you know connecting those servers yeah and then it gets very complex from there on how you can connect to other services and things like that but you know and the fact is like if you're a data center user you have to make decisions to like go into a facility and you don't know what the next three to five ten years are gonna be like so you so going into a facility that gives you connectivity options I mean this would make sense to kind of anything you know is better because it gives you flexibility because the unknown market will change and you've got to adapt with it all right let's talk about AC that's air conditioning that is a big component Addison yes talk about why that is you know what is some of the different components that go into that yes so any type of a call this power that is needed to operate servers effectively it produces heat and in order to allow those servers to function properly you have to cool them at a certain temperature and so HVAC and the cooling side of things on data center facilities are you know critical I mean you have to have that so that the facilities were will work efficiently and there's different ways to do that you can do that from water-cooled side you can do that from an air-cooled side of things but you know the fact is that these buildings have a lot of equipment tied to the cooling of the actual space itself so that the server's can operate efficiently and that really is one of the ways that you see big differences in data center design yes I like hot aisle containment or cold aisle containment and in the different ways that people have tackled that specific problem if you come from an engineering background it's really pretty fascinating yeah the way that uni 170 degree air 50 degree air to come in and it comes out at 8:00 anyways it's very very interesting but again just to kind of make the leap from someone who this is maybe new Terry you mean you think about your computer if you're running a bunch of applications or maybe you like open up a huge excel file and you hear that fan kick on because your processors ramped up doing a bunch of calculations generating he and your and it needs to get rid of that he because at some point a server will shut off you know or a computer a processing unit will shut off and so they've got to keep them below a certain range and typically there's an optimal ranges yeah smaller so that's again why there is a need for cooling yeah it's one of the reasons these are expensive facilities you know and the more like over time companies have done this much more efficiently so it's driven the costs down so like the data center facility that's being delivered today is very different than it was five ten years ago because of advances in cooling technology and things like that that are helping you know drive the cost down but also you know not waste things like extra water or whatever it might be so the cooling infrastructure I mean when you think about the infrastructure it's the the electrical infrastructure mechanical infrastructure that supports the cooling side of things it's you know it's critical part of the data center facility you know we mentioned like these again these facilities you will hear facilities that say we are a hundred percent uptime or five nines 99.9999 percent uptime like we have less than eighteen minutes of downtime of year or whatever that number may be so talk a little bit about hey how do you get there how do you achieve that from you know literally the power substation all the way to the server rack just quickly talk about what are the different components that get to that point word they can say hey we're what we're never gonna go down you know they literally eight I was a meteor but you know lightning can strike the earthquake there could be a tornado and this building is will continue to provide the digital infrastructure yeah I mean I think that's I mean it goes into the redundancy things which I think is when someone says we're done to see then that may not yeah you know means something good yeah you bet so this is basically just systems standing behind other systems to support the ones that are there currently so if system a goes down there's a system B that's sitting there ready to go so to Mike's point so that you know the data center does not lose power connectivity continues to function like normal nothing at the end of the day that's what the consumer cares about right you just want your picture on Facebook you don't care to know necessarily what is you know happening in the background you know business is going hey I need my banking system to run so my customers can get to it so they might look at areas where it might take to UPS systems to run the space but it's really important there's another to standing behind those two so they know if there's any type of issue with that that there's two more sitting there ready to go that are tested regularly that can that are redundant to the original two and there's different levels of redundancy we're going to get into that yeah basically now algebra lesson yes yes you know the at its basic level that is just you know you have additional equipment there to support the equipment that is currently running so that you can you know run the space if something happens the additional to the quick yeah and again what you'll typically see on like a brochure is you know what the level of generator redundancy is yep cool and redundancy and then you know there's some battery component that as well but you'll hear things like you know we've got 60 hours of fuel to run our generators and we've got contracts with two different field providers to bring bring fuel yeah it's something something along those lines if you're hearing those things that's what it informs yes it's their redundant capabilities yeah and these companies have done a really good job of thinking through as many challenges as they can to make sure that their facilities will run properly you know over a long period of time yep and that's that will tie into the next one is about compliance and and there's different ratings or certifications you can get as a data center we just touching this quickly but you hear things like tier 3 or tier 4 are very common that it ratings by what's called the uptime Institute yeah and it's a you know recognized kind of certification organization or body that they issue these so talk a little about that how that plays into data center design and what that's looked like historically yeah for you know for a long period of time this is probably you know five or 10 years ago tier for data centers were like the big thing to talk about and what is tier for me it's here for would be the most redundant most expensive data center you could build so it costs the most and it's it's the Lamborghini of data Sanderson and what happened was over time companies realized you know the extra money that it costs to achieve that Tier four certification for what it gets us we think the Tier three would would serve us better and we can save all that money and that's like what the Honda Odyssey no that would be like a mmm like a like a Range Rover still is that yeah there's probably a yeah that's true yeah that's true Lamborghinis probably the 150s two hundo so anyway I deal with luxury cars a lot as you can tell through so so anyway I mean that is where the industry is today like that tier 3 or tier 3 plus now one of things you mentioned in the uptime Institute and I know what people in the industry if you're listening this for thinking right now which is there's different certifications that the uptime Institute offers the uptime Institute it's a qualification certification that you pay for to have them come in and evaluate you know your data center kind of give this stamp of approval you can get the stamp of approval for the data center design and you can get the stamp of approval for the data center construction two separate things and you know there's some companies that will invest in that and then there's others that will just market what they're doing as tier 3 plus or tier 3 so it's really important for someone in this if you're trying to understand that to really go out and do your due diligence to really understand what that means because I think there are some people that have gotten you know burned by that marketing versus what's really been built but at the end of the day that's one certification that will or you know that will show someone what components have been built you know in the data center additionally to that there's you know every type of acronym you could ever want then describe the compliance Isis or sock wan sock TM we don't ramp right no need get into them but they're out there and it's a help google it and you get your financial company you're gonna have certain certifications that you have to meet with your data center infrastructure if you are a government entity you're gonna have certain certifications you have to meet so that just depends on you know the IT group that's running that and that can be yet is like us to understand Oh we'll talk about a second like the security of the building the physical security of building the electronic security yes software security the procedures you have in place you manage you can get in and out of the building right which texts can get into which cages etcetera so that's all you know part of it and that's true that is also very similar those exists you know in my prior life is a benefits administrator like we had to go through sock one so like do we have a peer-review process in place for our calculations anyways yeah all right so last you know talk about so building security big part like you can't obviously data security in general is a in extremely hot topic you know and identity theft is a big concern these days so you know you know your information right your health information your social security number etc that's all stored electronically somewhere so how are these data center companies keep it secure how do they make sure that that information is secure you know from an electronic standpoint from a physical standpoint yeah I mean the physical thing is probably the easiest to answer out of that you know typically these buildings will have significant like perimeter fencing so you know no one's gonna be able to drive your car directly up next to these facilities in today's world now some of them were built 10 15 years ago and where they were built maybe might not allow for a perimeter fence to be built but you know I think it's safe to say that most of these facilities from a physical security standpoint are gonna have some type of que rated fencing that allows like for no one to be able to drive through it etc you know - there's you know you're not gonna get in one of these buildings without needing to be there so you know you're gonna have to bring some sort of ID there's typically guards that are you know letting you in and then you know then to just get into the area where the actual raised floor space is there's biometric you know scanning sometimes there's man traps that will actually you know explain that one what's that you're have to explain that for a trap because yeah so maybe a bunch of different things yeah this is an area where you know there's an there's an entrance and an exit and one door does not open while the other door is open so you know you can't just kind of free flow into the you know from one space to another so first door opens you step in that door closes then that long exile can open so that that's what I do you ever know anybody who's set off an alarm unless things what happens if by the what happens if you trying to get one over for the expert I mean there are some you know I've you know I don't know how many data centers I've been in but it's a lot and there's probably two or three times that I've set off unintentionally set off like door alarms you know when someone has told me hey you're clear to go okay and I push and I mean there are some piercing like alarms and I'm like come on you have to turn up that loud like shake me to my core do you remember when the Bank of America site went down back in 2016 that was David crash the whole site because he open the door too quickly so true so anyway it's you know but but that's the type of security that companies I mean then when you actually get in the physical space of you know like let's say it's a shared environment so this means you know you might have one company that has a cage and then you have another company that's close by to that cage it also does each one of those cages will have locks they might have internal cameras they might have actual cage down to like below the raised floor and up above the ceiling see that so it depends on the organization you know financial and health care companies might have different security parameters than a technology company or an insurance company just depends on the industry and the company sensitivity level and then as you get into the cyber security you know discussion that's a whole other you know trail to go slightly above our pay grade sure suffice to say it exists and it exists at a very high level yeah and there's services around you know how do you protect yourselves from DDoS attacks from you know people getting your data I mean all the things that can hit you from a you know cyber standpoint companies are certainly aware of and you know most of the time mature organizations have people that are positioned to focus just on that yeah yeah one of things we didn't talk about is these facilities are all just called like a NOC Center which stands for Network Operations Command or never' Operations Center there we go there we go anyways and and it's a dedicated staff there 24/7 and they're monitoring both the physical and virtual I guess that's yep security of the facility so they're you know it's it's a it's a very highly complex and and highly skilled activity yeah a lot of times those network centers will be across different you know their their data center portfolios so you might have one in Dallas that looks exactly the same as the one in you know Santa Clara that looks exactly similar in Chicago and so they can they can actually help each other in certain situations where they where they need it sure alright last thing is how these facility facilities are leased which is a very which is very different than in office or an industrial complex talk a little about how their leased how that differs from you know your your typical price per square foot on the other side yeah like 15 years ago this was not a very competitive market I mean there just weren't a lot of people that were focused on this space and amatuer product offering over the last 15 years like it has changed dramatically so now we have competitors for companies have really big requirements competitors for companies have smaller requirements and you know with that comes the leasing of facilities companies to decide like hey I don't want to own and operate this in this servers myself I'd rather have somebody else do it and you can do that through colocation which we'll talk about on the road you can do that through cloud but basically if you're coming from the traditional real estate side all of the leasing that is done and the real estate business traditionally is done on square footage how much space am I taking and I'm gonna pay an amount per month per year for that space when you get in the data centers industry the focus is on power how much power you were using because you can you can put a lot of power in a small amount of space as long as you can cool it the cooling becomes the challenge so you know the focus so one of the one of the biggest one of the hardest things for people getting into the space to understand is that the leasing structure is different and it's not on square feet it is on you know either your price per KW per month there are some deal structures that could be on square footage but it is based on you know a certain amount of power or companies bringing their own capital to use the power infrastructure so you know I think the biggest takeaway if you're just getting in is just know that a data center is not going to be leased the same way as a an office building an industrial building a retail space etc it's a difference some of the things are similar though it's it's it is a by month basis typically a you know sixty plus month commitment so there are some things that are similar sure you're right the power the power is the main driver yeah and you got to understand that you understand the components around you know what it means to to lease a megawatt of power you know it doesn't mean you're using that whole megawatt it means you have the you're reserving the right and the equipment to do that and so there's just some you know that's different than the space aspect of that and that's one of the like I said it's one of the biggest challenges that there's some really smart people that have a hard time getting their arms around you know well hey I want to invest a hundred million dollars in the you know data center market so you know how many square feet is the Dallas Addison market well it's you know it's 350 megawatts and if yeah what does that mean well if somebody asks that question first you kind of understand quickly where they're where they come from knowledge level is sir which is great yeah help so alright that's very helpful David I've said it's in the past but if I cut you you bleed data center in just industry knowledge so appreciate that again we hope this is helpful again if there's that we're gonna cover if you look at the next you know six seven weeks or six seven you know podcasts will will cover some of the things you touched on today and yeah more detail from the redundancy side from the leasing side from the connectivity side and yeah and I would just encourage people that if you are getting into this space I mean our desire is that this would be helpful in you know as you establish the basics of this space that these would always be things you could go back to to really build your initial framework and that's really what we're trying to help people do I mean we want people to get into this industry we think the industry is going to keep growing I think the numbers that you know we have that show how the industry is growing will support that I think what's happening in this time period will support that but you know it's our hope that this content would be valuable in a way that helps you build your you know data center industry expertise so take a look at again we'll have the the link to the blog series and the show notes and just stay tuned for the next several pods to come out and where we talk to tackle some of those topics a little bit more detail see you soon see you soon

Channel: datacenterHawk

Views: 10,162

Rating: 4.9139786 out of 5

Keywords: Data center, what is a data center, data centers, colocation, cloud, IT, infrastructure, digital infrastructure, podcast, data center fundamentals, what is, data center basics, data center tour, what is a data center?, data center, data, center, datacenter, datacenters

Id: wZzQBI628Hs

Length: 48min 49sec (2929 seconds)

Published: Fri Jun 19 2020