Q&A: Mission Critical Site Selection
Several industry experts from leading technology companies, such as Facebook and Adobe, participated in a Straight Talk panel discussion on “Site Selection: Critical to Mission Critical” hosted by DPR in Palo Alto, CA. Following presentations that walked attendees through key site selection criteria for evaluating potential data center sites, including taxes, fiber routes and utilities, presenters shared their firsthand experiences and lessons learned.
Following are excerpts from the question and answer portion of the event:
Obviously, power supply and cost, government regulation, tax implication, and other factors weigh into the decision of site selection. Is there a factor that you put more emphasis on above all others?
It is very easy to disqualify sites. From there, there are lots of shades of grey. You must simply do your research.
Tom Furlong, Director of Site Operations at Facebook
We disqualified a lot of sites easily—primarily because one of the three items you mentioned fell short of our needs. One other critical criteria is how business-friendly and transparent the local municipality is and how much support they give you. That relationship can greatly affect your costs and schedule so it must be evaluated as well.
Michael Newman, Hosting Strategist for SaaS Infrastructure & Operations Group at Adobe
It is important to have sufficient utility power. After that, the variable that really swings wildly and can be of key importance is taxes.
Matt Mochary, Chief Executive Officer at Fortune Development Group
How much does construction cost weigh into your decision on site selection?
The cost of construction is traditionally just a fraction of the total cost. The bigger issue for us is the risk from a site over time. We care about the time it takes to build and the future of the building. I’m building a 20-year asset. We want that data center to be useful for the long haul.
We try to pick sites already on established grids, where both network and power grids are in place. For us, the biggest variable on the construction cost side is design intent. About 80 percent of your budget will be spent on electrical and mechanical equipment, which is heavily influenced by your design. Also, while the cost of construction matters, choosing vendors to mitigate risk matters as well.
John Sheputis, Chief Executive Officer at Fortune Data Centers
How do you balance economization against the other factors such as latency, land cost, etc.?
Issues such as humidity do matter, and that is much more of a concern in places like North Carolina, where we are building a data center. But we are much more driven by regional needs, a need to be in a certain area. Also much more driven by power need, and want to be in a low tax location.
Power and taxes matter more than climate!
If we are going to build, let’s build as efficiently as possible. Facebook at heart is an open-source company. The interesting thing about our design is we’ve gotten rid of lot of stuff in electrical and mechanical systems. This actually ends up increasing your ‘up time.’ A separate thought, but totally important, is to understand your system design and make sure that you are in alignment between the business needs and risks and what the facility can actually support.
What are your key lessons learned in your site selection processes?
As with most things, it will take longer than planned, and getting all the details takes time.
Peeling back the onion on power is important. So my number No. 1 advice is always have a second choice! And take them to the bitter end. No matter how smooth it seems, always keep two choices in play.
There are so many variables. Trying to achieve low land cost in site selection has a minor impact compared with what you are building. We need an emphasis on total cost certainty—and that is a result of certainty in our design.
For me, the lesson is direct access to information. We didn’t use a site selection broker, and that was painful. But we knew we collected all the information we needed.
What are your top intangibles for your selection criteria?
Number one intangible is labor. You have to be able to find people both to build the facility and run it. So for example, North Carolina is a right-to-work state; therefore, labor rates are half that in Oregon. No. 2 is staffing. Server technicians are hard to find, so that can be a challenge in different regions.
Posted on March 16, 2012
Last Updated August 23, 2022