Your next data centre will be a product

THE DATA CENTRE INDUSTRY is well-known for its conservative ways, and for good reason. Society and the economy rely ever more on the digital services making any interruption increasingly costly. To put it simply, data centre professionals and managers responsible for operations are not paid to innovate, but to maintain availability of services.

However, sticking to old habits may limit the ability of the business to grow, adapt to changing markets or increase cost efficiencies. A major issue is the construction of brick-and-mortar buildings to house the IT equipment. Traditional construction is inherently slow (spanning over 12-18 months typically) and difficult to manage, which makes design choices highly conservative but still exposes data centre projects to delays and cost overruns. Because adding data centre capacity is such a complex and resource-consuming task, enterprises and service providers alike build out well ahead of actual capacity needs, based on forecasts for demand. This results in inefficient use of capital and costly operations.

Eliminating clumsy construction works
If the industry wants to adapt to changes quicker and at a lower cost, doing away with clumsy construction works is key. Other industries have already done so: oil and gas tower and drilling platforms, pharmaceutical plants, telecommunications facilities and commercial kitchens and other applications all use prefabricated modular (PFM) builds.
In plain English, PFM methodology is about manufacturing the structures, testing and integrating the equipment in a factory – a much better controlled and more productive environment than a construction site. The modules are then transported (in whole or in parts) to site for final assembly to create, in our case, a data center. Lead times are typically between 12-26 weeks from order, which brings its speed much closer to IT projects.

PFM data centres are nothing new – the very first products appeared over a decade ago. It was not until the second half of the 2000s when vendors and products started mushrooming. 451 Research counts more than 50 vendors that ship prefabricated modular (PFM) data centres in some shape and form, a tally that is still growing as vendors are attracted by the potential of both the technology and the market. Prefabrication invites technology innovation throughout the data centre (architecture, cooling, power, software management) too, driving competition.
A growth market
Sales of prefabricated modular (PFM) data centre products are growing rapidly – probably the fastest-growing segment of the data centre building industry – although installations are still patchy compared with overall data centre building activity. PFM data centres’ faster time to production and much improved cash flow profile are winning over more operators in all geographies and verticals, including multi-tenant data centres and some hyperscale operators too.
Speed of uptake is at question, however. It will largely depend on how good a job suppliers do in communicating the benefits of PFM with clarity and in building up their sales coverage, either directly or via channel partners. Ease of planning and installation; faster time to production; and predictable costs and performance are some of the benefits existing customers highly value and should resonate with prospects.
451 Research estimates the global market for all PFM data centre products will reach nearly $4bn by 2018, which represents a five-year CAGR of 30.1%.

Other than risk avoidance and low product availability up until recent years, limited understanding of PFM data centres has dogged the industry. One of the major misunderstandings is that the relevance of PFM data centres is limited to selected, typically non-core use cases, such as remote microsites, temporary capacity needs or rapid deployment of disaster-recovery sites. That was probably true in the past, but certainly is not the case anymore: PFM data centres are gaining adoption in all industries, with all application types and in all sizes. Whether it is a campus site, a dedicated mission-critical operation for a medium or large enterprise, or a multi-tenant operator, a few racks or multiple megawatts, there are relevant PFM data centre designs already on the market.

The myths about containers
At the heart of this misunderstanding is the perception that PFM equals containers (that is, physical, shipping container-sized boxes, not software containers), and that containers are not quite fit for the job – a lack of space to perform work and reduced configuration flexibility hamper their usefulness, so the thinking goes.

This is incorrect on two accounts at least. First, there are various PFM data centre designs that can be used to create larger contiguous spaces (even some traditional-looking buildings). Modularity doesn’t necessitate small enclosed individual modules. Designers are free to create structures of virtually any size, to house a single rack or hundreds of racks. The chief architects and product strategists also decide what level of configuration flexibility they want to provide, at the possible cost of reduced manufacturing and operational efficiency. Vendors come from all walks of life and, as a result, each approach prefabricated data centres quite differently.

Second, containerised (and containerised-like) form factors are highly (and probably increasingly) relevant. Sales of containerised and custom enclosure data centres, increasingly into core sites, have already proved the usefulness of such form factors too. 451 Research expects this category of data centres to command a majority share of revenues through 2016 at least, while scalable building-type prefabricated structures are catching up in sales.
This year and next will be critical for many vendors trying to establish themselves as early leaders. Many PFM suppliers have been laying the groundwork for international expansion by setting up new regional offices or representation through strategic channel partners, and in some cases, developing new products too. The net result will be even higher availability of products across regions, stiffer competition and stronger evangelisation of the concept.

PFM allows data centre designers and managers to add exactly the amount and type of capacity they need with short lead times. This helps minimise slack capacity and mismatch in space, power and cooling with IT needs, while deferring large chunks of capital outlays. This combination of speed and granularity will also let operators adapt a new piece of technology – whether a smaller footprint, lighter structure; more efficient cooling; different power systems – faster by using a next generation module for an expansion.

451 Research believes that PFM technology is, with few exceptions, generally a superior way of delivering data centre capacity to traditional brick-and-mortar facilities. Regardless of a company’s specific scenario, ultimately it’s about choice. If data centre owners are not at least exploring and considering modular components as means to data centre expansion and new builds, they risk putting themselves at a significant disadvantage.

PFM vendors face two major challenges to success: they need to clearly articulate the potential of PFM methodology, while at the same time, persuade operators not to do it themselves, but rather to buy.