28 Jan 2019

Let’s take a look at the Illinois Data Center Market: Where are we headed?

CHICAGO

Chicago is one of the most important geographic locations of the internet age. It is our nation’s 3rd largest city and the population is more than twice the size of its surrounding areas. This population represents a large volume of consumers, participants, and produces in many aspects and venues. The rapid financial trading that occurs downtown with other financial exchanges around the globe gives us a high and stable demand for high-end connectivity. There was a time when the United States only had four network access points for the internet – Chicago was one of them. And the only one in the Midwest.

Chicago and its suburbs have relatively low costs of electricity and few environmental risks, which makes them prime locations for both giant enterprise and colocation data centers. Most of the major data center companies have multiple facilities in the city of just outside it. According to CBRE, Chicago is the 3rd largest data center market in the United States. Outside of Chicago and the suburbs adjacent to O’Hare Airport, the rest of the state has very few other data centers.

What About Growth?

The need for data centers is increasing at a much higher rate than the increase in the capacity of data storage devices. For the foreseeable future, the world will need an increasing number of data centers to maintain data in secure and accessible environments. Currently, Chicago is the third largest data center market in the United States. However, it is growing much more slowly than other major markets. From June 2017 to June 2018, the Chicago data center market grew at a rate of 7 percent. At the same time, the Atlanta market grew 12 percent, the Northern Virginia market grew 16 percent, and the Phoenix market grew 26 percent. And for all of the success of the Chicago area at attracting data centers, the rest of the state of Illinois has very few data centers. This is typical of states that have places with special catalysts for data center location, but that do not have state-wide data center incentives. 

Even though the Chicago area ranks third in the country for data center capacity, an increasing number of states, including neighboring Iowa, are wooing the facilities with tax incentives. In contrast, Illinois does not have incentives available, which can bring economic benefits including improved power grids and telecommunications systems. This would then attract more companies to bring more jobs to Chicago. Some worry that without incentives, the state’s data center industry growth will be impacted. We have a lot of smaller data center companies coming to Chicago, but not the tech-giants like Amazon or Google. Illinois lawmakers have previously introduced bills for tax credits in data centers, but have yet to go through. Are we missing out on huge opportunities? For now, we wait.

Referenced From Magnum Economics and Chicago Tribune

10 Jan 2019
Pictured: Silver Cross Hospital’s Data Center completed by LVS

“Digital transformation” has now become a buzzword when talking about data centers in the media. Marketers are embracing the term as there are real benefits to be gained from embracing the migration from analog information systems to automated digital ones. The demand for digital transformation initiatives will increase throughout the year as CEOs realize that their businesses will need to transform in order to stay relevant. 

Let’s take a look at 5 technologies that will significantly impact data centers in 2019.

5G Wireless

5G wireless technology provides significantly higher data rates and more data in more places. Mobile workforces of all kinds will begin to use more sophisticated applications that rely on quicker and more reliable data transfers. Even employees at the office will use 5G services to support their phones and other portable devices. As the widespread deployment of 5G isn’t happening for a few more years, data centers will need to prepare for it in 2019. The infrastructure must adapt to support the increased need for bandwidth and more data usage. Companies and building owners are looking beyond WiFi to allow for strong mobile wireless services with distributed antenna systems (DAS) consistently. 

IoT

The 5G wireless networks will need to support IoT applications. Companies are deploying thousands or millions of wired and wireless sensors that produce massive amounts of data. It is then turned into valuable information for the user. This processing of the data is being placed closer to the source to reduce communication requirements. This year, data center operators will use augmenting intelligence in autonomous systems to make use of expanded peer to peer communications at the edge. This is new to 5G networks. Fiber optic infrastructure will provide reliable, low-cost transmission capacity for edge data centers. Placing them close to the IoT sensors will reduce transmission latency and costs. 

VR/AR

Augmented reality (AR) is the use of a device like a cell phone to display relevant data while the user to watching/doing something live. There has been an increase in AR as technicians now hold phones while repairing product to see a schematic of the product with instructions about how to make the repair. Virtual reality (VR) is a total immersion into a virtual world through the use of a audio/visual headset. Remote training classes are held using this technology to learn hands on procedures before performing in real life. AR can be backed with today’s networks, but VR requires real-time video over internet. If the connection in unreliable, both technologies become irrelevant. 

Blockchain 

Blockchain is a decentralized database that is encoded, consensual, unchangeable, verifiable, and permanent. For logistics, blockchain is being used to establish trusted information. This can be information of where the product was made, when it was made, shipped, where it is located, and how it was used. This amount of public information can benefit businesses in many ways – which is why we will see it increasingly adopted in 2019. Data centers housing the distrusted ledgers will be significantly impacted. 

AI

Artificial intelligence has been slow in development because of its human-like characteristics. It also requires massive computers to support it. Now, the cost of computing has decreased greatly, algorithms have improved, and edge computing has allowed AI to be deployed in different ways. In order for corporations to invest in AI, they first need to adopt high-speed, low-latency networks partnered with high-end performance edge computing. 

All About the Infrastructure

All five of these advancing technologies illustrate how digital transformations of data centers will become a reality this year. This has been true for the last couple decades. Each year, businesses need to adapt to the advancing technologies in order to stay alive. To prepare for this year’s digital transformation, data center managers will need to implement advanced network infrastructure to make their networks faster, more ubiquitous, reliable, and secure. 

 

Credit: Here