>>Businesses are turning to outside companies to run their data centers faster than most of those companies can build additional facilities. Now demand is outpacing supply, and that could potentially drive up prices of data-center services.
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The result is the number of commercial data centers will rise just 5.3% year-to-year in 2009 and 4.75% in 2010, according to Tier1 Research. That is down from 6% in 2008.
The slowdown in new data-center facilities comes at a difficult time. To cut costs during the recession, many businesses running out of space in their own data centers have turned to third-party data-center providers to rent out space. Demand for these services rose 14% from a year earlier in 2008 and is expected to increase at similar or greater rates for the next several years, according to Tier1 Research.
Now the demand and supply is likely to diverge even more over the next few years, as the typical data center takes 12 to 24 months to build, says Daniel Golding, a Tier1 analyst. "It could be a big problem," he says.
It won't be long until current facilities begin to fill up. Globally, the data centers in use are about 65% full, according to Tier1. The company expects that to hit 70% in 2009 and rise seven percentage points or so each year thereafter. Equinix says it is operating at about 78% capacity and that it has accelerated development at a 340,000-square-foot facility it opened in Secaucus, N.J.
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