Area Development
{{RELATEDLINKS}}The high initial capital investment into the building of data center facilities and the long-term costs of replenishing IT hardware and/or infrastructure within these facilities make “them” a popular target for most economic development agencies.

The key concept most commonly misunderstood by economic development agencies is who “them” or “they” are.

While many economic development teams hope to land the large Internet data center (IDC) projects, the clear majority of data center users are traditional enterprises (EDCs).

The first step in targeting this sector is to therefore understand the three (3) primary types of data center operators: Enterprise Data Centers
All companies that have computers and share a central network have a data center. Most refer to it as their “server room” — but this is still a data center.

Enterprises typically have their primary data center located at or near their corporate headquarters facility where the IT team is located. They also have some type of back-up data center solution within an acceptable distance (i.e., risk, bandwidth latency, etc.) of the primary data center.

If the company or capacity needs are large enough, the data center may become its own stand-alone facility with higher levels of redundancy. It is important to note, however, that there is no direct correlation between employee count and data center size.

Because these enterprise data centers (EDCs) house the operations of an organization’s core applications, various levels of redundant systems are installed to prevent against downtime for power, cooling, and bandwidth. We often refer to these types of risk-averse enterprise data centers as “mission-critical facilities.”

Internet Data Centers
While there may be certain areas within an internet data center (IDC) that require higher-levels of redundancy, these facility types are often filled with highly dense racks of servers performing non–mission-critical functions (e.g., search).

Due to the high power capacity demands of IDCs, where redundancy is often made up for in the total number of facilities rather than redundancy within any one facility, Internet data centers tend to concentrate in lower-power-cost markets with access to multiple fiberoptic routes.

Third-Party Operators
Third-party data center operators (3POs) build and/or operate data centers for both enterprise (EDC) and Internet (IDC) data center users. These facility types include: These data center facilities can often be delivered to an end-user through a stack similar to Matryoshka (i.e., nesting) dolls. For example:
  1. Wholesale colocation provider leases to a retail colocation provider.
  2. The retail colocation provider licenses their capacity to an MSP.
  3. The MSP provides services to a cloud provider.
  4. The cloud provider then provides services to an end-user enterprise.
Like telecommunications providers who target expansion based on density, third-party operators most commonly target expansion in and around densely populated metropolitan areas. Therefore, unless tied to a build-to-suit, it’s rare for a third-party data center operator to build a new data center in a rural area.

Client Stakeholders
Not all internal client stakeholders speak the same business language.

While data centers are most commonly found inside of a building, the IT component is not real estate. Furthermore, while the real estate market experiences cycles, the world of information technology is continually evolving.

Regardless of whether the solution is delivered to an enterprise end-user via a cloud provider or through the enterprise end-user’s own IT staff, the IT hardware operating that application resides in a data center somewhere.

Part of the challenge for any new project is, therefore, bridging the communication gap between IT teams and those that operate their data centers. For example, in the stacking plan noted earlier, submitting information about a property for conversion to the head of IT for an enterprise company may do little good. Likewise, submitting properties to real estate teams that aren’t aligned with the corporate IT departments will also do little good.

Solutions
For economic development teams, property owners, developers, and other interested parties (collectively, “interested parties”) to truly penetrate these complex projects, they must learn to communicate effectively with all internal stakeholders, and then strategically market accordingly.

Enterprise, Internet, and third-party data center operators each have their own unique sets of minimum site selection requirements.

Some of the key concepts to learn are (alphabetical order): Knowing Their Market
In sum, in order to attract data center operators to their region, interested parties must know their “market,” i.e., develop an understanding of both the infrastructure of their region AND which data center market categories they’re most likely to attract. They need to invest the time to research: Interested parties must also choose methods of communication delivery that are successful in approaching the various stakeholders. The hook is relevant information. Like with fishing, they have to place that hook upstream and float it down to the appropriate spot. They may need to recast multiple times to successfully place their information in front of the right decision-makers.