Thursday, January 22, 2009

Data Center Colocation Crisis: Act Now or Pay Later


>>CIOs are facing a critical resource shortage and, if they don't plan accordingly, will face escalating costs and end up squandering a large portion of their budgets. Yes, the looming data center shortage, which has already hit London hard, is fast approaching the United States as well.

With over 85 percent occupancy, data center lease costs have doubled in London in just the last 12 months. And with the Olympics coming in 2012, and a moratorium on building new "data centres" (as they spell it in merry old England) proclaimed by the power company that supplies London's electricity, the situation is bleak.

Across the pond in New England, I've seen monthly lease prices for colocation data center space increase 675 percent over the last five years. The same provider that offered Tier 3-type space for $4 a square foot back then is now charging about $30. In the metro New York market, don't be surprised to see prices in the $45 to $50 range.

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