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Facebook, Myspace, Microsoft, Apple, and Google are among the top firms competing in a race for the limited amount of U.S. server space.  (Source: Data Center Knowledge)
California, North Carolina, and Virginia are among the parts of the nation experiencing the strongest demand

Many aspects of our modern digital life -- smartphones, Wi-Fi internet, internet-connected cable TVs, and "smart" schools -- are often taken for granted.  However, behind the scenes there's a massive amount of work required to secure hardware for transmission to these devices and obtain sufficient computing power at data centers to process the incoming and outgoing traffic.

Except to the most hardcore of information technology administrators, rows of servers don't seem very stylish or chic -- unlike the sleek devices like iPhones and Android smartphones which they support.  And their appeal was lessened when the Dot Com Bubble burst in 2000 trashing personal investment accounts.  The problem at the time was relatively simple, yet few could see it -- there was immense infrastructure investment, but there just wasn't the demand from internet customers to warrant it yet.

Now a decade removed from that cold hard lesson in economics, firms that deal with internet connected devices and web software are facing the opposite challenge.  The demand from customers is soaring to all time highs, but they don't have the infrastructure to sufficiently support it.

Three of the nation's hottest markets in the demand for data centers are California's Silicon Valley, Virginia (which borders the super-connected Washington, D.C.), and North Carolina.  Facebook, the world's largest social network, just snatched up a bunch of newly constructed data center space in Santa Clara, California and Ashburn, Virginia.  The company is riding on a wave of lucrative monetization and soaring user counts; its 30,000 servers as of October 2009 are merely not enough as it has added 100 million users in the last seven months.

Facebook isn't the only high profile shopper though to go hunting for data center space, though.  Apple is building a $1B USD server farm in Maiden, which is located in North Carolina's Catawba County.  The farm will help support the hosting demands of Apple's hot iPhone and iPad App Store service and iTunes service.

And one can only assume that Google, which has an ever-expanding flow of web traffic (including now a massive amount of traffic from Android devices), is also stocking up on data space.

Wild demand has transformed these drab buildings populated by racks of blinking servers  from the ugly ducklings of the tech sphere into rock stars of the tech world.  The big concern now is that there are only 
so many builders of server space and they are having trouble keeping up with demand and decided where to focus their data center construction efforts.

Companies such as DuPont Fabros and Terremark have been scaling back their construction efforts in California and jumping to Virginia, where lucrative tax breaks (thanks to demand in Washington, D.C.) await.  Network Operation Center (NOC) Equinix warns that that this could spell trouble for West Coast giants like Yahoo, Facebook, Microsoft, and Google.  Predicts the firm, "It’s too early to say with certainty that these delays will lead to space shortages in Silicon Valley. But they set the stage for a tight supply-demand scenario in which landlords with space will have significant leverage."

The good news is that while there may be supply shortages, the wild growth should help to create new information technology jobs, filling gaps in the recovery U.S. economy.  For that reason alone, the traditionally boring server is becoming an exciting object of beauty.





"I f***ing cannot play Halo 2 multiplayer. I cannot do it." -- Bungie Technical Lead Chris Butcher













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