Good Wednesday morning, and welcome to Data Center Digest.
We’re looking at data centers and the people, technologies, and trends that make them run.

Today’s Newsletter:

⛈️Cloud spending continues to rise, despite falling demand…
🐘 The biggest data center projects currently in development
Big Deals: Akami bets big on the edge, Ubiquity buys EdgePresence,
Daily Dall-e: a look inside the first data center on record…

Est. read time: 5mins, 15secs

- News -

Cloud growth fueled by surge in server and storage prices, IDC

According to research firm IDC, spending on storage for cloud deployments climbed by 15% YoY in the first quarter of 2023, settling in at $21.5 billion.

Demand down, prices up: The increase came in the face of a significant decrease in demand for cloud services. Although unit demand fell over 11% in the cloud infrastructure segment, the segment grew due to an increase in average selling prices of 30%. (!)
IDC says soaring prices are due to a combination of inflationary forces and a larger focus on expensive, GPU-accelerated systems (think AI).

So they’re selling significantly fewer servers this year, but the servers they are moving are way more expensive.

Cloud Infrastructure up too: A surprise to no one in the industry, spending on shared cloud infrastructure also climbed last quarter, reaching $15.7 billion in the first three months of the year (22% higher than this time last year).

IDC’s Kuba Stolarski says, “Cloud infrastructure spending remains resilient in the face of macroeconomic challenges.” And although the segment is dealing with substantial price hikes, growth continues to accelerate. However, Stolarski points out that this growth hinges on the expectation that volume will catch up to it.

Essentially, prolonged stagnation in demand may pose a significant obstacle for growth for the remainder of the year.

What’s more: On-premise computing and storage sales continue to slow, as enterprises continue to move their data and compute to the cloud. IDC predicts that if anything, the rise in AI will accelerate this migration.

- What Else -

A look at the US’s biggest data center projects in development

Compass at PW Gateway - $2.3 Billion

• Joining an already massive QTS campus, the application for Compass’s new data Center in Prince William County plans for up to 11.5 million sqft of data center space spread out over nearly 900 acres.

• It’s not clear exactly how many buildings are planned for the site, but they expect to build them out over the next 10-15 years.

• It is rumored that the project could total more than 1,000MW.

Prime Data Centers, Avondale AZ - $2 Billion

• Design plans for Prime’s first Phoenix-area data center call for a 1.3 million sqft data center facility spread out over five buildings.

• The 210 MW campus promises to offer customers access to 100% renewable energy, and its closed loop cooling system will, they claim, use 97% less water than an equally sized neighborhood.

• Prime picked the Phoenix market because, “With compelling state tax incentives, power costs 16% to 18% below national averages and low risk of natural disasters, Phoenix will sustain its position for years to come. Chris Sumter at Prime Data Centers.

Atlas Power in North Dakota - $1.9 Billion

• Conveniently located in Williston, North Dakota, the new Atlas Power data center consists of 3 phases so far announced, with a total planned capacity of 700MW.

• Phase 1, slated to complete construction in 2024, will feature a 168,000 sqft facility spread out over 16 buildings, each about 11,000 sqft.

• Atlas Power has been in the news lately, with a North Dakota court threatening to cut off power to one of their data centers due to unresolved code violations.  

Stack’s new Prince William data center - $1.7 Billion

• The land has been purchased and the construction of phase 1 (700k sqft) of Stack Infrastructure’s new 4 million sqft Manassas data center has begun.

• The 125-acre campus will offer over 250MW of build-to-suite computing power.

• Known as the NVAL campus, the facility will be supported by high-capacity dark fiber and will have access to all major long-haul fiber carriers for low-latency connectivity.

- Big Deals -

Daily Dall-E

A view inside the first data center, circa 1.6 million years B.C.

Thanks a lot for reading.

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- Taylor