Is RTP Becoming a Favored Location for Data Centers?

If you are a regular reader of this blog, you probably have picked up the fact that I live in the Raleigh, NC area - sometimes referred to as the Triangle Area. The "Triangle" name came from the intersection of the three major universities in the region:

• North Carolina State University - where I am attending now for my MBA.
• The University of North Carolina at Chapel Hill - who won the NCAA men's basketball national championship a few weeks ago.
• Duke University - I think everyone has heard of Duke.

(Some people say the "Triangle" name just comes from the three cities in the area: Raleigh, Durham, and Chapel Hill. I like the school story better, so I'm going with that one.)

The Triangle is a great place to live. Good jobs, decent cost of living, and good weather. Raleigh or Cary (largest suburb) is often ranked in the Top 10 Best Places to Live, sometimes even #1 in many surveys.

I agree. This is a great place to live and work.

Right in the middle of the "Triangle" is Research Triangle Park (RTP).

RTP is the economic engine that drives the region. This area, full of high tech, IT, pharmaceutical, and bio-tech companies, is what brings a lot of good jobs and big businesses to the area. Even Cisco has a 12-builing campus here in RTP with 3,000-4,000 employees. Many of you have probably taken the CCIE lab here.

Recently, I've noticed something else that seems to be moving to RTP also - Data Centers. Big ones! I think the EPA started the trend 7-years ago when it built its new campus in RTP including its National Computing Center. But recently, there have been a barrage of data center announcements and openings:

• IBM
• NetApp
• Social Security Administration
• SAS
• Credit Suisse (announced, but never built)
• Fidelity Investments

I've also heard rumors of another large technology company building a data center in RTP.

So, why the influx of major data centers to the region? I am not a data center location expert, but I will give my top 3 reasons:

1. Low electricity rates. Data centers use a lot of juice. North Carolina uses a lot of nuclear power combined with low taxes to keep electricity rates low.
2. A skilled workforce - companies tend to locate around their data centers, or at least need skilled people in the area to run the data center. The Triangle provides a very skilled workforce with competitive wages.
3. Decent environment - many of the new data centers being built are "green" and use outside air to cool the equipment. Except for June, July, and August, outside air can be used to cool equipment in RTP (9 out of 12 months of the year). Furthermore, believe it or not, most hurricanes, by the time they get to the RTP area, are just bad thunderstorms. They do not create the destruction inland you see on the coast. Plus, no earthquakes here.

I'm interested to see if this trend continues. There's plenty of competition out there, but there is something special about this area that people and companies understand. Building data centers here is a natural next step for many businesses and governments.

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