Browsing by Author "Savolainen, Antti Tapio"

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Strategic investment criteria for mega data centers - Case a small town in Finland
(2013) Savolainen, Antti Tapio
School of Science | Master's thesis
Digitalization of societies and business is driving explosive growth for data center services. The growth of data is coming from an ever-growing number of sources: interconnected sensors, scientific, medical and enterprise transactional data and digital entertainment, to name a few. Data centers are the backbone infrastructure these services run on. Traditionally, enterprises have run their own datacenters or outsourced their management to a third party. With cloud computing becoming an increasingly popular service provision model for these services, the modern cloud data centers have grown into mega-size facilities spanning tens of thousands of square meters and consuming tens, even hundreds of megawatts of power and costing hundreds of millions in capital expenditure. Finland has been thought of as an ideal place to host these data centers thanks to advanced power infrastructure, cheap electricity, stable operating environment and cool climate. This study seeks to understand the strategic criteria behind these multi-hundred million dollar investments in a single-case study context. What are the national and regional factors that drive these investments? The case setting in this thesis is an industrial city in Finland, which is looking for data center investments to accelerate business activity in the area< In the literature review, the modern data center is defined and the potential market for data center construction is analysed. The empirical part the study employs a qualitative research methodology. Total of 26 people were interviewed to form a holistic view of the data center investment decision. These people represented a wide view of stakeholders (energy, networks, regional development, government and data center industry executives and analysts). Using qualitative data analysis methods a framework was constructed that break the factors driving the investments into two categories: primary and secondary. Primary factors are energy (availability, price, redundancy of grid, generation mix), network (availability of fiber and latency and routing to largest internet exchanges), incentives and physical aspects of the site. Secondary factors are knowledge, safety & security and customer base. The results suggest that Finland has basic prerequisites in order to function as a data center hub, such as stable operating environment and a redundant electricity grid. In order for Finland to become a global data center hub the nation needs to invest in cable projects that would make Finland an intersection point of data traffic between Asia and Europe. In addition Finland needs make it self-better known in the data center industry.