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10 Sep 2024

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Risk Assessment Essential to Planning Big Data Centers

Global stock markets gave everyone a quick wake-up call on Monday, led by the big exchanges in New York, with “Magnificent Seven” star Nvidia going down 6% to focus everyone's mind on the present AI-driven market boom (see link below). The daylong panic was precipitated by a weak jobs report from the US government.

In Silicon Valley, former elite-club member Cisco announced a 5% layoff (about 4,000 jobs), although this cut is paradoxically a result of a renewed focus on AI opportunities, according to reports.

From around the world, the industry frets about the risks to global electricity grids as well as the global network of submarine cables. All conseuential events -- positive or tragic -- are linked by a single word: risk. Risk assessment, management, and its consequences inform every plane we make, every action we take.

In the data center and digital infrastructure industry, risk from natural disaster or power shortages informs every decision to locate, expand, or close a facility. There is personal risk in operations from the large amounts of electricity, heat, water and chemicals under pressure, and physical infrastructure. There is market risk, risk from direct competitors, and risk from business plans gone awry.

Data center operators turn to redundancy as a primary strategy in addressing much of their infrastructure risk. Data center customers assume their big cloud vendors are addressing such risk effectively.

Even so, builders are still simply asking for “as big as possible” in describing what they want in a new data center, as if the local power supply and markets will take care of themselves.

We've been living in the Zettabyte Age for a few years now. The internet processed a zettabyte of data (ie, one thousand exabytes or one million petabytes) in 2021. It continues to increase at 25% each year, and 70% of this traffic at one time or another passes through the gigawatts of data centers in a single county (Loudoun County, Virginia) in the US.

How does our industry assess this risk as a whole, from the abstract level to the nitty gritty of walking aisles and seeing what's going on? How do you address your physical and financial risk, as a facility and as a company? We have no science-fiction stories or doomsday scenarios to offer, but we must all realize that industry risk is existential, first for businesses and second for people.

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