Five myths about data centers! Is cloud storage really replacing data centers?

Increasingly more data is used and the IT equipment required for it has to be placed somewhere. Understandably, this also raises questions and doubts not always grounded in reality. Let us take a look at the global myths often associated with data centers!

A private room in a data center. Photo: Tõnu Tunnel.

Myth 1: Cloud storage is replacing data centers

If a company wants to extend its IT capabilities beyond its office servers, cloud computing with its low entry costs is initially the easiest option. Over the last five years, there has been a lot of talk about cloud systems as well as their pros and cons. This is probably also what gave rise to the belief that cloud systems are the future.

Even Kert Evert, the author of the idea of Estonia’s largest data center, recalls an investor who withdrew from the project, justifying his decision by saying that soon, no one would need data centers because everyone was moving to the cloud.

The stories about cloud often fail to mention that the clouds also have to be physically located somewhere and ultimately require IT equipment and connections; hence the saying that ‘the cloud is just someone else’s computer’. Nowadays, these computers are usually located in, as you have probably guessed, data centers. This means that one cannot exist without the other.

By its very nature, a data center is the foundation on which IT equipment and the e-services delivered by it to millions of users are built.

Myth 2: Data centers are a threat to nature and consume the vast majority of the world’s electricity.

Maintaining our digital society is extremely energy-intensive – there is no getting around this fact. However, it is estimated that only two to three per cent of global energy consumption is spent on data centers. We have written about this at length before in the blog.

In recent years, increasing attention has been paid to the efficiency of data centers. This is done by looking at the PUE, or Power Usage Effectiveness. The lower the PUE, the better. In Europe, new data centers that have joined the Climate Neutral Data Center Pact have set a target PUE of 1.3 in cool climates and 1.4 in warm climates by 2025.

The energy efficiency of data centers depends a lot on the market. If customers demand the smallest possible ecological footprint, this is what they get. If this requirement is not prioritised, the transition to greener digital infrastructure will be slower. Many data centers already use certified green energy and implement energy-saving technologies, such as AI-based optimisation of cooling systems and heat recovery. Rapid advances in technology, including artificial intelligence, have contributed greatly to the creation of smart systems.

The amount of energy that may go to waste due to old or poorly designed systems in office buildings or in converted server rooms, where equipment is also kept, is another story (we have written about this before in the blog from the cooling systems angle).

Myth 3: Data centers are the exclusive domain of very large companies

It is true that tech giants cannot survive without data centers. We have heard about the giant data centers of Microsoft, Facebook, and Google. Last year, Google invested USD 9.5 billion in its data centers and offices, of which USD 750 million was used for the construction of a huge new ‘data city’ consisting of four buildings. (This is due to the skyrocketing demand for the Google Cloud Platform (GCP), further proving that there is no cloud without a data center).

In reality, however, data centers are also used by much smaller businesses that need security, a high level of operational reliability, and physical access to their equipment. In Estonia alone, there are dozens of companies that limit themselves to one or a few equipment cabinets in local data centers. In data centers, capacities can be varied according to the needs of the business, so you can start by renting one or a few cabinets rather than investing millions to build your own data center.

Myth 4: Data centers are fully automatable

Although automation has become increasingly important in data center operations (see the AI-driven cooling systems above), a data center cannot exist without people. There is talk of technological advances, energy use, security and reliability, but almost never about the human resources needed to keep it all running. Type ‘data center’ into a Google image search and see how long you have to scroll before some of the images showing people and infrastructure together pop up.

In reality, no data center is fully automated. As in other areas fearful of the advance of the AI, technology is a useful helper rather than a competitor that takes jobs away from people. Even designing a data center is too complex and nuanced for an AI. From builders to technicians and engineers – the skills, knowledge, and judgement of people are indispensable when it comes to building and operating data centers.

Myth 5: Anyone can build their own data center

The first thing to point out here is that people see all types of spaces that may have been rebuilt to store data but do not actually provide reliability or security as data centers. So in that sense, practically anyone can build one indeed.

However, the electrical, cooling, security, communication, and overall construction of a proper data center has to meet high standards that not everyone can guarantee. These standards make the building of data very costly. Building and operating data centers requires large investments, technical expertise, and the corresponding infrastructure. Advanced knowledge of data management, security and performance optimisation is required and a wide range of legal and regulatory requirements must be complied with. There is also a limited number of suitable locations for a data center.

International standards include more than 100 different criteria for the location of a data center. For example, data should be kept away from dangerous traffic and production, but at the same time, a data center should be located close enough to major transport nodes. It is smart to build the center on higher ground to reduce the risk of flooding and increase the number of days with favourable wind conditions. This allows the data center to be cooled by outside air for most of the year, hence saving energy. The climate in Estonia is perfect for data centers and there are only a few hundred hours a year when free cooling is not enough. By the way, Estonia also ranks among the top ten countries in the world for hosting data centers.

There are certainly organisations around the world that can, and have, built their own state-of-the-art data center, but doing it is usually not affordable or economically feasible.

In summary, even if there is some truth to the myths surrounding data centers, the stories have been mostly ‘lost in translation’ and blown out of proportion. Cloud storage will not lead to the extinction of data centers; the energy-efficient storage of data in data centers will not cause an energy crisis; a data center can be used even when only a few device cabinets are needed; and certainly not everyone can set up a proper, reliable, and secure data center.