5 Types of Data Centers (2022)

Ring ring?

“Hello Client, how are you?" “Hello Broker, IT has asked CRE if we can help with their data center requirement."

"Of course, I’ve done that a bunch of times, I’ll stop by next week to discuss.”

Click! Damn! It’s time to search Google for how to find a data center. Nearly all brokers have received that call and like all brokers attempting to practice a new area of real estate, there are a number of stumbling blocks that you have or will encounter. Many of us have had a chance as we are visiting a client’s headquarters to see a data center or have marketed a property that has raised floor and not sure the value of the equipment or space left behind.

I was introduced to data centers and disaster recovery sites in the early 90s. In the late 90s I was fortunate to become quite proficient at helping many of the largest telecommunication companies with their site selection, and we rode that wave through the dot com bubble in 2001. In 2004, my new clients were leasing these fossils at pennies on the dollar, and by 2007, I became 100 percent focused on helping my clients ride the wave up.

(Video) Data Center Tiers Explained

There are a wide variety of data centers and the costs associated with them vary considerably. In short order, this will provide a general simple guide from traditional and most expensive to the newer types and less expensive. I will attempt to bundle them into five categories, but there is cross over among the categories and the landlords/service providers.

The 5 Types ofData Centers:

1. Enterprise Datacenters – This is the one that most of us are familiar with. It was owned and built by the end user to house its data center. Many companies still have their data center on the corporate campus and there are a handful of companies building one for their own use. This is not the most proficient use of precious capital. One of the most recent transactions is State Farm building a 130,000 sq. ft. data center outside of Dallas. Due to the favorable U.S. tax law, Reid McConnell Tax act, 2011 is when the most recent wave of corporate data centers were built. Companies spend between $1,000/sq. ft. and $4,000/sq. ft. on the construction based on the technical "white floor” space, although most of these figures today would be described in terms of power. Thus, $10 to $40 million per megawatt. For simplicity purposes, assume that the client will spend another $10 million per megawatt on servers.

2. Managed Services Providers – This was the earliest form of outsourcing which occurred when companies hired AT & T, IBM, and HP. This has evolved and there are a number of managed services providers that let companies manage some, or all, of their data center functions. This is more typically handled by IT and Corporate Real Estate is seldom involved.

3) Colocation grew out of the managed services business in the early 2000s as companies were willing to outsource some of their operations, but still wanted to have their own employees maintain control. Certain companies (i.e. financial institutions, healthcare, etc.) who are highly regulated are required to maintain complete control of their IT functions. This is a question you should be asking your clients. Thus, companies lease one rack or one cage from a provider and their employees are responsible for doing much of the work within the space. Many of these sites have the added benefit of being able to connect with another companies servers, thus cross connects. Thus if you are a trading firm you want to connect with a financial exchange to facilitate trades. Pricing is based on a per rack basis and there are a number of ala carte items that companies can purchase such as cross connects or remote hands. One of the largest colocation providers is Equinix, although this type of business model exists in nearly every mid-size U.S. market.

(Video) Data Centres: Tiers explained

4) Wholesale data centers became popular in 2007 and 2008 as some companies such as Facebook, Microsoft and Yahoo needed more than just a rack or a cage, but wanted a much larger space and often times didn’t have enough time to build a new site. These facilities are commonly referred to as multi-tenant data centers (MTDC). The tenant space within the MTDC is traditionally a 10,000 sf hard walled suite, sf and companies are charged based on the amount of power allocated to them. There are some variable costs associated with these properties, but this is significantly less expensive than any of the aforementioned. Digital Realty Trust is considered the largest and these types of landlords tend to be mostly located within NFL cities. If a client signs a 1MW lease for 10 years the rent would be comparable to an office transaction leasing 60,000sf for 10 years at $28/rsf.

5) Cloud data centers have become more popular in recent years and the popular providers include Amazon (AWS), IBM (Softlayer), and Microsoft (Azure). Many of us are using the cloud on a regular basis and don’t realize it. Salesforce CRM is a private cloud and Netflix is housed at AWS. This is the most inexpensive form of data centers. While many of these companies build less robust data centers thus offering lower pricing, increasingly in the last two years they have accounted for significant leasing from the wholesale providers.

Determining the right solution for your client is no simple task and ensuring the right stakeholders are at the table is the most important thing to do first. Similar to your day job, understanding the goals and objectives of the task at hand are key to a successful data center transaction. This is when the laundry list of questions becomes quite robust. Cost? Latency? Lease? License? Application? Disaster recovery or primary? Application within business (i.e. production vs. storage vs. email)? How many racks are needed? What is the density of racks on a kw basis? What is the projected growth of this particular business? Geographic restrictions? What type of redundancy are they looking for? N? N+1? 2N?

One solution does not always work. In fact some of the largest companies use each of the aforementioned data centers depending on the need of the internal business unit. These often are located in different parts of the US and the world. In fact some companies are federally regulated as to where or where they can’t store there information.

Believe it or not, coming up with an RFP is usually rather simple or the landlord will do so for you. Creating a spreadsheet that incorporates all of the various scenarios and comparing on a like basis is the hard part. Is this a gross, modified gross, NNNN (Quad Net) lease? How do you take into account for PUE, spike in property taxes related to a change in use, replacing equipment, electricity that is passed to the tenant? Do you have comps? Good luck, as finding reliable comps is nearly impossible.

(Video) Data Center Fundamentals Series 1 of 5

Negotiating the lease document can also be quite treacherous and it is helpful if you have an experienced attorney. There can be a number of “gotchas” if you don’t know what to look for and I have found that having the involvement of my client’s IT person is one of the keys related to where the handoff from landlord to tenant takes place.

As all experienced SIORs know, having a commission agreement and your client covering your back is more important in this space than any other. It’s still a bit of the Wild West and you need to insure that all of your hard work is going to be rewarded.

Finally, now that you are the expert, don’t assume that whatever property you have is the next greatest data center. In general developers that are reusing assets are looking for larger properties that have significant power that can be brought to the site (1 MW per 20,000 sq. ft.), clear heights in excess of 15 feet, fiber in close proximity, concrete not timber construction, away from any hazards such as airports, lakes, and highways. The developers have limited capital and if the second largest operator hasn’t spent capital in Dallas, it is unlikely that they are going to add a salesforce to Mayberry just because Barney Fife is providing security.

(Video) Types of data centers: Colocation, Enterprise, & Carrier Hotel – Data Center Fundamentals

FAQs

What are different types of data Centres? ›

In this technology explainer we look at the different classifications of a data center; Hyperscale, Colocation, Wholesale Colocation, Enterprise, and Telecom, and explore what they do and who they are for.

What is a Level 5 data center? ›

The New Tier Level 5® Standard

This advanced data center features heightened redundancy, long-term power capabilities, zero roof penetrations, physical and network security, 100% use of renewable energy and more.

How many types of data centers are there? ›

Depending on the destination there are four different types of data centers, each designed for a specific business model and has its own operational problems and issues: Corporate data centers. Web hosting data centers, providing computer infrastructure as a service (IaaS)

What is a Class 4 data center? ›

Tier 4: A Tier 4 data center is built to be completely fault tolerant and has redundancy for every component. It has an expected uptime of 99.995% (26.3 minutes of downtime annually).

What is data center give example? ›

A data center is a facility of one or more buildings that house a centralized computing infrastructure, typically servers, storage, and networking equipment. In this world of apps, big data, and digital everything, you can't stay on top of your industry without cutting-edge computing infrastructure.

What is in a data center? ›

These may include storage systems; servers; network infrastructure, such as switches and routers; and various information security elements, such as firewalls. Support infrastructure – equipment contributing to securely sustaining the highest availability possible.

What is the highest classification of data center? ›

Tier 4 data center security marks the highest standard for data centers—usually utilized by businesses that require constant availability, which is most businesses today. They have an uptime of 99.995%, meaning annual downtime of no more than 26 minutes.

What is a Tier 1 data Centre? ›

Tier 1: A data center with a single path for power and cooling, and no backup components. This tier has an expected uptime of 99.671% per year. Tier 2: A data center with a single path for power and cooling, and some redundant and backup components. This tier offers an expected uptime of 99.741% per year.

What is a tier 0 data center? ›

Tier 0 is defined as a single-site data center that does not back up data or, if data is backed up, backups are left on site. The data center does not have a disaster recovery plan or backup hardware and software.

What are the three types of cloud data centers? ›

There are also three main types of cloud computing services: Infrastructure-as-a-Service (IaaS), Platforms-as-a-Service (PaaS), and Software-as-a-Service (SaaS). Choosing a cloud type or cloud service is a unique decision.

What are data center technologies? ›

A data center - also known as a data center or data center - is a facility made up of networked computers, storage systems, and computing infrastructure that businesses and other organizations use to organize, process, store large amounts of data. And to broadcast.

Why are data centres important? ›

Data centres are where the cloud lives (cloud computing refers to data centres available to many users over the internet) and where all our data, photographs and music is stored. They are a vital component of the global economy, whether you are an individual, a business, a city or a country.

What is tier 1 and tier 2 and Tier 3? ›

Tier 1,2,3 cities. Cities in India have been classified into Tier 1, 2 and 3 categories. The most developed ones are called tier 1 and the underdeveloped ones are called tier 2 and tier 3 cities.

Is tier 1 or 3 better? ›

In layman's terms, tier 1 companies are the big guns, and the tier 3 ones are the more modest firms. Over time, companies can move up the tiers if they fit the criteria. Now, let's explore the different tiers a little more. Tier 1 firms are the largest, wealthiest, and most experienced in the industry.

What is a Tier 3? ›

At Tier 3, these students receive more intensive, individualized support to improve their behavioral and academic outcomes. Tier 3 strategies work for students with developmental disabilities, autism, emotional and behavioral disorders, and students with no diagnostic label at all.

How does a data center work? ›

Data centers contain physical or virtual servers that are connected internally and externally through networking and communication equipment to store, transfer and access digital information. Each server has a processor, storage space and memory, similar to a personal computer but with more power.

How many data Centres are there in the world? ›

Number of data centers worldwide in 2022, by country
CharacteristicNumber of data centers
U.S.2,701
Germany487
UK456
China443
9 more rows
26 Sept 2022

What is data center design? ›

Data center design is a process of designing and modelling a data centre system's architectural layout, IT resources, and complete infrastructure. It enables the logical conception of the data center before the development or deployment in the organisation's IT environment.

Is a data center a server? ›

The main difference between server and data centre is that server is a high-powered computer that stores, processes, and manages data internally or virtually. On the other hand, data centre is a physical storage facility that stores critical applications and data of an organisation.

How data centers are built? ›

The traditional data center is built on a three-tier infrastructure with discreet blocks of compute, storage, and network resources allocated to support specific applications. In a hyper-converged infrastructure (HCI), the three tiers are combined into a single building block called a node.

Who works at a data center? ›

Data Center Operators ensure that mainframes and large computers are functioning efficiently in a data center organization. Their job is to ensure that network servers are running well, and need to escalate issues centers face to data center managers.

What is datacenter standard? ›

What Are Data Center Design Standards? There are various aspects of a data center that are standard including cooling, rack density, redundancy and uptime, networking, security, and compliance. These standards help assess a data center's capabilities on what it can offer its users.

What is the difference between Tier 3 and Tier 4 data center? ›

As a general rule, the difference between data center tiers is that tier 1 offers no redundancy of any critical system, tier 2 has partial redundancy in their electrical & HVAC systems, tier 3 contains dual redundancy for power & cooling equipment, and tier 4 possesses fully redundant infrastructure.

What is difference between Tier 3 and Tier 4? ›

Any unplanned activity such as operational errors or spontaneous failures of infrastructure components can still cause an outage. In other words, Tier III isn't entirely fault tolerant. A Tier 4 data center is fault-tolerant, allowing for the occurrence of any unplanned activity while still maintaining operations.

Is Azure a Tier 4 data center? ›

Given that a tier 4 datacenter is designed towards a customer SLA and service need of 99,995%, we can state that an Azure Datacenter exceeds the expectations of a tier 4 datacenter. In countries like Belgium & the Netherlands, it is impossible to achieve a Tier IV (4) classification.

Is tier 1 the highest or lowest? ›

Tier 1 Credit is the highest tier of credit, while Tier 3 is the lowest.

What is tier level? ›

A tier is a level or a layer. If you sit in the top tier of seats at a concert, you can see the whole stage and most of the audience — but you probably have to climb lots of stairs.

What is a Tier 3 facility? ›

Tier 3: A Tier 3 data center has multiple paths for power and cooling and systems in place to update and maintain it without taking it offline. It has an expected uptime of 99.982% (1.6 hours of downtime annually).

What is a tier 1 application? ›

High Availability for business-critical applications

Tier 1 is for applications that you can tolerate having down for a couple hours, but will have significant negative impact on your operations if they are out of commission for too long.

What is a Tier 3 business? ›

Tier 3 suppliers or partners are one step further removed from a final product and typically work in raw materials. Once again, following our apparel company example: The Tier 3 supplier here is the farm that sells cotton to the fabric mill.

What is big data center? ›

A data centre is the physical infrastructure that houses critical applications and data. From cloud storage applications support to data backup, networking to hosting websites, data centres play a pivotal role in running the tech-driven modern world.

What is data center in AWS? ›

AWS pioneered cloud computing in 2006, creating cloud infrastructure that allows you to securely build and innovate faster. We are continuously innovating the design and systems of our data centers to protect them from man-made and natural risks.

What are 3 types of cloud deployment models? ›

There are four cloud deployment models: public, private, community, and hybrid.

What is new data center? ›

Expect a focus on hybrid cloud, solid-state storage, DCIM and sustainability measures. 2022 is shaping up to include familiar, predictable advancements but with a few surprises. On-premises data centers can expect to see improvements this year in security, energy management and power outages or power disruptions.

What is a data center in cloud? ›

A cloud data center moves a traditional on-prem data center off-site. Instead of personally managing their own infrastructure, an organization leases infrastructure managed by a third-party partner and accesses data center resources over the Internet.

How are data centers connected? ›

Data Center Interconnect (DCI) technology connects two or more data centers together over short, medium, or long distances using high-speed packet-optical connectivity. Data Centers house compute and storage resources for applications, data, and content.

How do you maintain a data center? ›

Data Center Operations and Maintenance Best Practices
  1. Ensure Uptime by Creating Redundancies. ...
  2. Keep Indoor Climates Stable. ...
  3. Create Stronger Testing Protocols. ...
  4. Implement Predictive Maintenance. ...
  5. Staff for Operating & Maintaining Data Centers. ...
  6. Keep It Clean. ...
  7. Practice Good Data Hygiene. ...
  8. Maintain Emergency Preparedness.

How do data centers keep data safe? ›

What are some of the ways that data centers keep data safe? Data centers keep data secure by adding storage redundancy, redundant internet access, and cloud hosting for sensitive information.

What characteristics does a data center have? ›

10 Features to Look For in a Data Center
  • Location. Thanks to the cloud and the simplicity of remote access, your data can live virtually anywhere. ...
  • Physical Security. ...
  • Network Redundancy. ...
  • Financial Stability. ...
  • Scalability. ...
  • Disaster Recovery Plan. ...
  • Think to the Future. ...
  • 24/7 Support and Monitoring.

What is a Tier 4 company? ›

Tier4 Group is a women-owned and diversity-certified LGBTBE technology Talent, Professional Services, Advisory, and Information Security firm with a national reach.

Is Cisco a Tier 1 company? ›

For example, Cisco is regarded as a tier 1 vendor in storage area network (SAN) switching equipment and related technical certifications. A tier 1 vendor may also be a "preferred" vendor that provides products and services to you at appealing prices or other favorable terms.

Is Tier 1 or tier 2 better? ›

Tier 2 capital is considered less reliable than Tier 1 capital because it is more difficult to accurately calculate and more difficult to liquidate.

Is SAP a Tier 1? ›

Tier 1 companies include SAP, Syspro, Microsoft Dynamics, Oracle, and NetSuite (which Oracle acquired).

Is Google a Tier 1 company? ›

It seems like the general tier 1 companies here are Google, FB, Netflix and maybe Uber or some other top unicorn. What other companies are conceited tier 1?

What is the difference between Tier 1 2 3? ›

For this reason, school-specific terms for these levels of support were developed: Tier 1 = Universal or core instruction. Tier 2 = Targeted or strategic instruction/intervention. Tier 3 = Intensive instruction/intervention.

What was Tier 4? ›

You must stay at home and only travel for work, education or other legally permitted reasons. If you must travel, you should stay local, and reduce the number of journeys you make. You must not leave a Tier 4 area or stay overnight away from home.

What is meant by Tier 2? ›

1. In information technology, a tier 2 vendor is a smaller and less well-known provider as compared to a tier 1 vendor. A tier 2 vendor is often also limited in its geographic coverage as well. As a consequence, a tier 2 vendor is generally regarded as a secondary source rather than the preferred source.

What is the difference between Tier 2 and 3? ›

Whereas Tier 2 assessment is largely at the group-level, Tier 3 assessment is at the individual level. Thus, assessment at Tier 3 requires a much more comprehensive, thorough, and intensive approach. To accomplish this, assessment at Tier 3 is organized within the RIOT/ICEL framework.

What is the difference between a data center and a colocation? ›

A data centre is a purpose-built facility designed to efficiently store, power, cool and connect your IT infrastructure. Colocation is one of many services data centres provide, and is the act of hosting your IT hardware (like servers) outside of your premises and in a data centre.

What are data center technologies? ›

A data center - also known as a data center or data center - is a facility made up of networked computers, storage systems, and computing infrastructure that businesses and other organizations use to organize, process, store large amounts of data. And to broadcast.

What is data center in AWS? ›

AWS pioneered cloud computing in 2006, creating cloud infrastructure that allows you to securely build and innovate faster. We are continuously innovating the design and systems of our data centers to protect them from man-made and natural risks.

What are the different data centers deployed for cloud computing? ›

  • Enterprise Dedicated Servers. Plesk Dedicated Servers.
  • Forex VPS Hosting.
  • Cloud Security.
  • Data Centers. Services. Data Center Migration. Data Center Outsourcing. Security. Disaster Recovery.

Who is the largest data center provider? ›

Top 11 BEST Data Center Companies | Datacenter Services In 2022
  • Comparison Of The Best Data Center Service Providers.
  • #1) Equinix.
  • #2) Digital Realty.
  • #3) China Telecom.
  • #4) NTT Communications.
  • #5) Telehouse/KDDI.
  • #6) Coresite.
  • #7) Verizon.
7 days ago

How does a datacenter work? ›

Data centers contain physical or virtual servers that are connected internally and externally through networking and communication equipment to store, transfer and access digital information. Each server has a processor, storage space and memory, similar to a personal computer but with more power.

What is a hyperscale data center? ›

The clue is in the name: hyperscale data centers are massive facilities built by companies with vast data processing and storage needs. These firms may derive their income directly from the applications or websites the equipment supports, or sell technology management services to third parties.

What is new data center? ›

Expect a focus on hybrid cloud, solid-state storage, DCIM and sustainability measures. 2022 is shaping up to include familiar, predictable advancements but with a few surprises. On-premises data centers can expect to see improvements this year in security, energy management and power outages or power disruptions.

Why are data centers important? ›

Data centers offer the possibilities – scalability, security, efficiency and state-of-the-art technology – that are increasingly demanded by companies and organizations, but are too expensive to realize themselves. Data migration yields a lot; from safety and reliability to energy efficiency and cost reduction.

What is data center design? ›

Data center design is a process of designing and modelling a data centre system's architectural layout, IT resources, and complete infrastructure. It enables the logical conception of the data center before the development or deployment in the organisation's IT environment.

What does S3 stand for? ›

Amazon Simple Storage Service (Amazon S3) is an object storage service that offers industry-leading scalability, data availability, security, and performance.

How many data Centres are there in the world? ›

Number of data centers worldwide in 2022, by country
CharacteristicNumber of data centers
U.S.2,701
Germany487
UK456
China443
9 more rows
26 Sept 2022

How many data centers does Google have? ›

In total, Google has nearly 30 owned data centers either in operation or under development across 10 countries throughout the world.

What are the three types of cloud data centers? ›

There are also three main types of cloud computing services: Infrastructure-as-a-Service (IaaS), Platforms-as-a-Service (PaaS), and Software-as-a-Service (SaaS). Choosing a cloud type or cloud service is a unique decision.

How many servers does a data center have? ›

On the lower end, a small, in-house data center could somewhere near 1000 servers. Most data centers are quite large, however, and a more typical number is close to 100,000 servers.

How are data centers connected to each other? ›

Data Center Interconnect (DCI) technology connects two or more data centers together over short, medium, or long distances using high-speed packet-optical connectivity. Data Centers house compute and storage resources for applications, data, and content.

Videos

1. What is a Data Center?
(Google Cloud Tech)
2. What is a data center?
(Schneider Electric)
3. Data Center Infrastructure Design Webinar l IEEE LAU Student Branch
(Knowledge Base)
4. Top 5 Data Center Companies & 7 U.S. Markets
(DgtlInfra)
5. Data Center Power Chain - Animation
(TechTrainerNJ)
6. Inside Amazon's Massive Data Center
(Tech Vision)

Top Articles

Latest Posts

Article information

Author: The Hon. Margery Christiansen

Last Updated: 11/04/2022

Views: 6242

Rating: 5 / 5 (50 voted)

Reviews: 81% of readers found this page helpful

Author information

Name: The Hon. Margery Christiansen

Birthday: 2000-07-07

Address: 5050 Breitenberg Knoll, New Robert, MI 45409

Phone: +2556892639372

Job: Investor Mining Engineer

Hobby: Sketching, Cosplaying, Glassblowing, Genealogy, Crocheting, Archery, Skateboarding

Introduction: My name is The Hon. Margery Christiansen, I am a bright, adorable, precious, inexpensive, gorgeous, comfortable, happy person who loves writing and wants to share my knowledge and understanding with you.