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Here’s a roundup of some of some of this week’s headlines from the data center and hosting industry:

• SoftLayer continues data center expansion. SoftLayer Technologies announced the opening of three new data center pods in the Dallas, Seattle and northern Virginia data centers.  The new pods add capacity for 20,000 additional servers, bringing total capacity to more than 45,000 servers. “These three new pods meet the customer demand increases that we expect in the very near future,” said Lance Crosby, CEO of SoftLayer. “And they are only preliminary measures in our growth strategy for 2010. We have some big plans which we can’t wait to share with everyone.”  SoftLayer has standardized on the pod architecture for data center design, allowing them to optimize space, power, network, personnel and internal infrastructure. The company recently announced that it was on track to report more than $80 million in revenue for 2009 and raised $20 million to fund the continued growth of the company.
• Power Loft opens Virginia Data Center: Power Loft LLC announced the substantial completion of their first data center, Power Loft @ Innovation. Located in Prince William County, Virginia, this 225,000 square foot facility has signed an international IT technology outsourcing company as its anchor tenant, and was recently awarded the first Northern Virginia Technology Council’s Green Award. “Power Loft is in the forefront of creating energy efficient data center space,” said Bobbie Kilberg, President & CEO of the Northern Virginia Technology Council (NVTC).  “Having our company singled out to receive the NVTC Green Award, turned four years of hard work into a very unexpected night of celebration for us all,” said Jim Coakley, CEO of Power Loft LLC. “We are very
  proud to be so honored and we commend the NVTC for elevating the visibility of the many companies in Northern
  Virginia who are making an increasingly positive impact on our environment.”
• Level 3 to support Clearwire’s 4G network. Level 3 Communications announced an expanded relationship with Clearwire Communications Tuesday to support their CLEAR 4G WiMax services.  The agreement provides Clearwire with network transport services as a part of their deployment of CLEAR WiMax services in major metropolitan markets across the United States. Level 3 will provide high speed connectivity to Chicago, Dallas, Philadelphia, Seattle, Washington D.C., Houston and the Bay area.   CLEAR 4G WiMax is a next generation mobile internet solution from Clearwire that claims to be 4 times faster than 3G.  Clearwire has been growing rapidly and in their third quarter 2009 results reported that 4G network coverage increased by 67% to over 10 million people.  They also recently had a $1.564 billion equity financing round. Is there a map for that? – you bet.

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Roundup: SoftLayer, Power Loft, Level 3

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Here’s a roundup of news announcements from the data center and hosting industry:

• Key milestone to 100 Gigabit Ethernet demonstrated. At the SC09 conference in Oregon Monday Infinera, Internet2, Juniper Networks and Level 3 demonstrated 100 Gbps data transport between Seattle and the SC09 show floor in Portland.  The 100 Gbps of test data was sent via a single slot on the Juniper T1600 Series Core Router, populated with a new 10
  

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A view of the Intergate.Columbia data center complex built by Sabey Corp. in Wenatchee, Washington.

Sabey Corp.’s Intergate.Columbia data center complex near East Wenatchee, Washington has received the Technology Development of the Year award from NAIOP, the commercial real estate development association. Sabey, a Seattle-based developer was presented the award at the Washington Chapter of NAIOP’s event on Nov. 6.

Intergate.Columbia is a 438,000 square foot data center campus, which includes large data centers for T-Mobile and VMware. Sabey Construction Inc. broke ground at the 30-acre site near the Columbia River in April 2008 and simultaneously constructed the shell and core for two buildings. Despite the dual schedules, the work was completed by the end of the year on time and within budget.

“The project would have been much more difficult had it not been for the support of the Douglas County officials who vigorously worked with us and assisted in our success,” said John Sabey, Senior V.P. Real Estate for Sabey.

The Douglas County Public Utility District gets 98.5 percent of its electricity from hydroelectric dams and 1.5 percent from wind generation. Other energy saving measures included the use of air economizers for “free-cooling” for most of the year, as well as evaporative cooling which is possible due to the relative dryness of eastern Washington’s air.

Sabey is in the final stage of LEED silver certification for Building B, where the tenant, VMware, is pursuing a platinum LEED certification for its Sabey-built tenant improvements. Building B’s mechanical system uses hot air/cold air physical separation as well as evaporative cooling. This enables a significant increase in data center efficiency by extending the number of hours that the data center can use air-side economizer “free cooling.” The cooling system also captures the server-generated heat to help maintain office temperatures year round.

Sabey also recognized John Ford, Director of Technology Real Estate; John Sasser, Manager of Data Center Operations; Doug Gardner, Senior Project Manager; Andrew Gardner, Superintendent; and Marcus McFarland, Project Engineer of Sabey Construction, Inc.

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Sabey Wenatchee Project Honored by NAIOP

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Internap Network Services (INAP) said Thursday that it will expand its data center in Seattle as part of a broader effort to shift more of its colocation business from partner data centers into facilities owned by Internap. The Seattle expansion is expected to cost $22 million, or nearly half of the $50 million Internap has earmarked for its data center expansion.

The project will add 15,000 net sellable square feet of capacity to Internap’s current footprint in Seattle, with the new space expected to open during the third quarter of 2010. “Seattle was a compelling choice for expansion because of our multi-facility footprint, local market knowledge, existing sales and support infrastructure as well as our ability to leverage brand reputation,” said Internap CEO Eric Cooney. “We feel this market offers Internap a unique opportunity to expand with relatively low risk and relatively high reward.”

Seeking Improved Margins
The shift in data center strategy is driven by the opportunity to realize better profit margins. Internap’s data center revenue is about evenly split between in-house data centers and space leased from providers like Equinix. In Thursday’s conference call with analysts, Cooney said Internap sees a 50 percent margin on customers in company-operated data centers, as opposed to 5 percent in partner facilities.

“Going forward, we will continue to execute our data center strategy to focus on growth and company control data centers, while we proactively reduce our partner data center providers to a small number of mutually beneficial relationships,” he said.

How will that be accomplished? “We intend to proactively churn select loss making and or low margin partner colocation revenue,” said Cooney. “As most of these contracts are short term being less than 12 months in many cases we will simply choose not to renew these contracts. In other cases, we are seeking to renegotiate the contract and pass the customer directly to the data center provider. In both scenarios we expect to retain the Internap value added services such as IP transit or CDN which those customers are also taking.”

Internap said it expects this will mean a quarterly decline of about $5 million in partner colocation revenue by the fourth quarter of 2010, but will boost the profitmargins on the remaining partner data center space from the current 5 percent to about 20 percent.

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Internap Expands Seattle Data Center

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