Data Center Power Pricing - Open Spectrum Inc - Sean Patrick Tario - DeltaForce IT
How Different Kw/Hr Pricing Is Impacting Regional Demand - Who Wins, Loses and Why?
Sean Patrick Tario
www.linkedin.com/in/seanpatricktario
• Seasoned IT professional and entrepreneur. Worked with dozens of start-ups and scaling companies as a general adviser, director, consultant, investor and award winning sales producer
• Currently serves as the CEO of both Open Spectrum Inc., a global IT Infrastructure consulting firm, and DeltaForceIT, which provides tactical sales training for those working within the data center and hosting industries
• Personally negotiated and closed over 100 data center and hosting deals within the past 3 years with over 60 clients and 30 different service providers around the world.
• Intimately familiar with both retail and wholesale data center markets within North America, Europe and Australia
Power Matters
• Sophisticated buyers of retail and wholesale data center space are concerned about:
– Who owns the power grid
– Ratios of Import vs. Export
– Ratios of Power Source
– Rate fluctuations per kw/hour over time – Subsidies Available
– Stability and Priority of Local Sub-Stations
Demand Implications
• DO THE MATH!
– 1 Megawatt in Quincy, WA costs
$21.90 x 1,000 = $21,900/month
– 1 Megawatt in Santa Clara, CA costs $73 x 1,000 = $73,000/month -$613,000 annual savings
• Substantialsavingsforbothowner/operatorsAND clients within regions with utility providers who generate their own power.
Demand Implications
• Taking into consideration PUE, savings are even higher.
• As Retail providers build facilities and provide fully managed services in regions with lower power costs, BIG DATA will migrate (and is migrating) away from the major hubs.
• Cost of living is also much lower in regions with lower power costs.
Fracking, Solar, Wind... Greenwashing
• “Green” power is mostly an illusion and requires user pay a premium
• Private Power Grid Owners are not incentivized to reduce their total cost of delivering services to their consumers... so even if they CAN they likely will not
• Cost is extremely high and timeframes to roll out new energy programs are extremely high
Impact, Ramifications and Timing
• Mostly corporate owned data centers currently built in these low cost regions NOW
– Facebook, Google, Microsoft, Intuit, Yahoo, etc.
• Sabey and Viawest as an example of private
retail and wholesale providers who “get it”
• I know of NO publicly traded data center providers who currently “get it” because, “...2nd and 3rd tier markets are not a priority”
Beginners Guide to TikTok for Search - Rachel Pearson - We are Tilt __ Bright...
Data Center Power Pricing - Open Spectrum Inc - Sean Patrick Tario - DeltaForce IT
1. Data
Center
Power
Pricing
How
Different
Kw/Hr
Pricing
Is
Impacting
Regional
Demand
-‐
Who
Wins,
Loses
and
Why?
!
Sean
Patrick
Tario,
CEO
2. Sean
Patrick
Tario
www.linkedin.com/in/seanpatricktario
• Seasoned
IT
professional
and
entrepreneur.
Worked
with
dozens
of
start-‐ups
and
scaling
companies
as
a
general
adviser,
director,
consultant,
investor
and
award
winning
sales
producer
• Currently
serves
as
the
CEO
of
both
Open
Spectrum
Inc.,
a
global
IT
Infrastructure
consulting
firm,
and
DeltaForceIT,
which
provides
tactical
sales
training
for
those
working
within
the
data
center
and
hosting
industries
• Personally
negotiated
and
closed
over
100
data
center
and
hosting
deals
within
the
past
3
years
with
over
60
clients
and
30
different
service
providers
around
the
world.
• Intimately
familiar
with
both
retail
and
wholesale
data
center
markets
within
North
America,
Europe
and
Australia
3. Power
Matters
• Sophisticated
buyers
of
retail
and
wholesale
data
center
space
are
concerned
about:
– Who
owns
the
power
grid
– Ratios
of
Import
vs.
Export
– Ratios
of
Power
Source
– Rate
fluctuations
per
kw/hour
over
time
– Subsidies
Available
– Stability
and
Priority
of
Local
Sub-‐Stations
4. Power
Pricing
by
Region
(cost
per
kw/hour)
Region
Avg.
Cost
Region
Avg.
Cost
North
Bay
Area,
CA
$0.12
Denver,
CO
$0.07
South
Bay
Area,
CA
$0.10
Dallas,
TX
$0.07
Sacramento,
CA
$0.10
Austin,
TX
$0.06
Los
Angeles,
CA
$0.12
Chicago,
IL
$0.07
Seattle,
WA
$0.06
Philadelphia,
PA
$0.10
Quincy,
WA
$0.03
Miami,
FL
$0.08
Portland,
OR
$0.07
Atlanta,
GA
$0.06
Las
Vegas,
NV
$0.08
Richmond,
VA
$0.06
Pheonix,
AZ
$0.06
NYC,
NY
$0.18
Salt
Lake
City,
UT
$0.05
Secaucus,
NJ
$0.12
5. Power
Pricing
by
Region
(cost
per
kw
per
month)
Region
Avg.
Cost
Region
Avg.
Cost
North
Bay
Area,
CA
$87.60
Denver,
CO
$51.10
South
Bay
Area,
CA
$73.00
Dallas,
TX
$51.10
Sacramento,
CA
$73.00
Austin,
TX
$43.80
Los
Angeles,
CA
$87.60
Chicago,
IL
$51.10
Seattle,
WA
$43.80
Philadelphia,
PA
$73.00
Quincy,
WA
$21.90
Miami,
FL
$58.40
Portland,
OR
$51.10
Atlanta,
GA
$43.80
Las
Vegas,
NV
$58.40
Richmond,
VA
$43.80
Pheonix,
AZ
$43.80
NYC,
NY
$131.40
Salt
Lake
City,
UT
$36.50
Secaucus,
NJ
$87.60
6. Demand
Implications
• DO
THE
MATH!
– 1
Megawatt
in
Quincy,
WA
costs
$21.90
x
1,000
=
$21,900/month
– 1
Megawatt
in
Santa
Clara,
CA
costs
$73
x
1,000
=
$73,000/month
-‐$613,000
annual
savings
• Substantial
savings
for
both
owner/operators
AND
clients
within
regions
with
utility
providers
who
generate
their
own
power.
7. Demand
Implications
• Taking
into
consideration
PUE,
savings
are
even
higher.
• As
Retail
providers
build
facilities
and
provide
fully
managed
services
in
regions
with
lower
power
costs,
BIG
DATA
will
migrate
(and
is
migrating)
away
from
the
major
hubs.
• Cost
of
living
is
also
much
lower
in
regions
with
lower
power
costs.
8. Fracking,
Solar,
Wind…
Greenwashing
• “Green”
power
is
mostly
an
illusion
and
requires
user
pay
a
premium
• Private
Power
Grid
Owners
are
not
incentivized
to
reduce
their
total
cost
of
delivering
services
to
their
consumers…
so
even
if
they
CAN
they
likely
will
not
• Cost
is
extremely
high
and
timeframes
to
roll
out
new
energy
programs
are
extremely
high
9. Impact,
Ramifications
and
Timing
• Mostly
corporate
owned
data
centers
currently
built
in
these
low
cost
regions
NOW
– Facebook,
Google,
Microsoft,
Intuit,
Yahoo,
etc.
• Sabey
and
Viawest
as
an
example
of
private
retail
and
wholesale
providers
who
“get
it”
• I
know
of
NO
publicly
traded
data
center
providers
who
currently
“get
it”
because,
“…2nd
and
3rd
tier
markets
are
not
a
priority”