Good 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 gaming is here, for better or for worse
🤖 AI is changing the way that data centers are built
Big Deals: DigitalOne buys bare metal provider, Compass buys Sears headquarters, Flexential to build more DCs
Resources: Three podcast episodes

Est. read time: 5mins, 15secs

- News -

The cloud gaming revolution is here, for better and worse

Like Netflix, but for gaming - cloud gaming leverages powerful, remote servers that execute all the intense computations and operations of modern games, streaming the video and audio output in real-time back to the player's device.

This means that high-end, graphically-intensive games are no longer exclusive to expensive hardware - a stable internet connection does the trick.

Game Changers

Unparalleled Accessibility: Cloud gaming shrinks the gaming world into your pocket. Now, PCs, consoles, smartphones, and tablets are all valid gaming devices. No longer are gamers tied to the hardware that they can afford to play the games they want to play.
All of the intensive computation behind rendering graphics and sound is done in a server room and then streamed to an individual’s device.

Immediate Immersion: Gamers are saying goodbye to download times. With cloud gaming, you can dive into new experiences right away, no waiting needed as there is nothing that needs to be downloaded to a local device

Cloudy Caveats

Internet Dependency: The need for high-speed internet can be a challenge. Real-time streaming requires stability and speed; lag and latency can be a game-killer. And contrary to olden times when you could choose to play offline and enjoy the game single-player, gamers don’t have that option with games they’re streaming.

Digital-only Ownership: No more trading, selling, or lending games. In the cloud, games are rented, not owned. They’re streamed, not downloaded.
While this of course reduces the upfront costs of trying and enjoying new games, many feel something is lost by not having ownership of their favorite titles.

Recent Developments

Key players like Microsoft's Xbox Cloud Gaming (the current market leader) and NVIDIA's GeForce Now are adding their own twist to cloud gaming, making it an ever-evolving arena. Add to this the introduction of 5G technology, alleviating latency issues, and the industry's projected growth to $2.03 billion by year-end, cloud gaming is on a rapid ascent.

Cloud gaming is a ground-breaking shift in gaming, promising more accessibility and convenience, essentially democratizing gaming access across the globe. It’s clear that the future of gaming is here – and it's in the cloud, whether gamers like it or not.

DCDynamics talks to industry leaders about AI and IT infrastructure

DC Dynamics recently spoke with Digital Realty CEO Andy Power, who joined the firm 8 years ago and describes the change in the data center market this way: “We were moving from one to three megawatt IT suites, and we quickly went to six to eight, then tens.”
And now, “you're hearing some more deals in the hundreds of megawatts, and I've had preliminary conversations in the last handful of months where customers are saying ‘talk to me about a gigawatt.”

Powers says there’s uncertainty with the traditional approach of splitting up compute workloads across geographical regions. He thinks operators will have to keep these facilities in close proximity to other data centers with more traditional workloads, but just how close is still unclear.

The Data Centers

Power says, “Plain and simple, it's gonna be a hotter environment, you're just going to put a lot more power-dense servers in and you're gonna need to innovate your existing footprints, and your design for new footprints.”

According to Powers, in the future, we’ll have two buildings right next to each other. One will be for traditional cloud workloads, and next door, double or triple its size, youll have a different design, different cooling infrastructure, and different power density to handle AI workloads.

At the same time, AWS is considering a different approach. Chetan Kapoor, Director of Project Management at AWS, says, “Instead of packing in a lot of compute into a single rack, what we're trying to do is to build infrastructure that is scalable and deployable across multiple regions and is as power-efficient as possible,” Kapoor said.

“If you're trying to densely pack a lot of these servers, the cost is going to go up, because you'll have to come up with costly solutions to actually cool it.”

Concerns moving forward

For all its hopes of solving or transcending the challenges of today, the growth of generative AI will be held back by the wider difficulties that have plagued the data center market - the problems of scale.

While AI researchers and chip designers face the scale challenges of parameter counts and memory allocation, data center builders and operators will have to overcome their own scaling bottlenecks to meet the demands of generative AI.

- Big Deals -

• Flexential announces additional data center builds in Atlanta and Hillsboro, OR. An expansion of 110MW, the announcement details plans to bring Flexential’s total number of data centers to 41 by EoY.

• CloudOne Digital acquires bare metal provider Servers.com for $200 million. “With this acquisition, CloudOne Digital broadens its product offering… and adds services for mid-market customers who have highly persistent, compute-intensive workloads which consume cloud servers and dedicated bare metal cloud as an alternative to hyperscale public cloud.” -CloudOne CEO

• Compass Data Centers to buy Sears Headquarters outside of Chicago.

- Resources -

Daily Dall-E

One of the earliest beta tests, as imagined by Rembrandt.

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- Taylor