Thursday, November 18, 2010

North Carolina Hype Getting Out of Hand

By David Gross

North Carolina recently added Indian IT Services provider Wipro to its growing list of private data center builders, and it's been off to the races for industry pundits, some of whom are hyping North Carolina as the next great location for the industry.   I've written a couple articles about North Carolina, and agree that it's doing a good job recruiting brand name companies, but any comparisons to Silicon Valley and Northern Virginia are ridiculous.

The public data center market continues to be driven by bandwidth, while the private market is driven by power and tax incentives.  Not surprisingly, they're heading into different locations as a result.   Moreover, these fundamental attributes aren't changing much.   No one is talking about building their own private data center in Santa Clara or Ashburn, and none of the public providers are heading to rural Oregon or the banks of Lake Ontario.

Investors need to get beyond the hype and conventional thinking that spreads quickly, and look instead at the factors that go into data center site decisions, which change far less frequently than many other aspects of the data center industry.

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