Insights into the evolution of data centres in 2024

In the dynamic landscape of technological innovation, data centres have long been seen as the backbone of IT infrastructure. And, as the Chief Revenue Officer for VIRTUS Data Centres, I’ve seen first-hand the seismic shifts and transformative trends shaping our industry. 

It’s no secret that the demand for data centres is experiencing unprecedented exponential growth, propelled by the relentless expansion of the digital economy. However, a transformative force has entered the scene - the integration of Artificial Intelligence (AI) and Machine Learning (ML) workloads. This paradigm shift has prompted VIRTUS and other data centre providers to re-evaluate traditional methods of data centre scalability.

With these developments in mind, what does 2024 hold in store for the industry? Here are some of the trends I’m expecting to see in the year ahead.

1. Rethinking Scalability: AI's Influence on Location Dynamics

In an era where location was meticulously chosen for latency considerations, the integration of AI/ML workloads is rewriting the rules. Less latency-sensitive, these workloads are prompting a reconsideration of optimal sites, favouring 200-500MW campuses with renewable energy access. This strategic move acknowledges the non-linear cost relationship, challenging the traditional latency minimisation focus.

AI/ML integration encourages exploration of unconventional data centre sites, departing from traditional location dynamics. The emphasis on 200-500MW-capable campuses aligns with sustainability, recognising the importance of energy efficiency. This transformative impact of AI sparks a renaissance in data centre operations, intertwining scalability, efficiency, and strategic location choices.

2. Defying Labels: The Emergence of Megascale Campuses

In our fast moving world, discussions are underway about what to name the next generation of data centres - Hyperscale 2.0, Megascale, Gigascale, and various other options are on the table. However, for us, the term "Hyperscale" isn't merely about physical size; it's a reflection of the specific customer it refers to.

With this perspective in mind, we are refining how we categorise data centre sizes. The term "Hyperscale" has evolved beyond a size descriptor to represent a distinct customer category. At VIRTUS, we think the term "megascale campuses to host hyperscale customers” more accurately defines the ongoing industry transformations. 

However, regardless of the terminology, one common challenge is evident; meeting the significant capacity demands of customers. The current limitations of European hyperscale facilities to address the growing AI market underscore this challenge. VIRTUS is proactively bridging this gap by developing megascale campuses. Our 300MW campus in Berlin exemplifies our commitment to providing large-scale, sustainable facilities ready to meet the demands of tomorrow.

3. Designing for Tomorrow: The Imperative of Flexibility and Sustainability

In the ever-evolving data centre landscape, flexibility in design emerges as a key factor. Early engagement with customers becomes a linchpin, enabling a "build-to-suit" approach that yields optimal outcomes. At VIRTUS, we are already actively operating customer equipment supporting AI/ML workloads, incorporating liquid cooling, immersive cooling capabilities, and robust infrastructure to adapt to the rapidly changing technology landscape.

Sustainability is of course at the forefront of our strategic approach. The power must come from renewable sources, and efficient use is imperative. In countries like Germany, stringent laws guide data centre Power Usage Effectiveness (PUE) to drive responsible behaviour. VIRTUS invests substantial time and resources to meet sustainability targets, exemplified by the new Berlin campus in Wustermark which is directly connected to the highest concentration of wind farms in Europe.

Cooling, an unavoidable aspect of keeping data centres running, also requires innovative solutions. While it's impossible to defy the laws of thermodynamics, efficient heat removal from the facility is essential. Liquid cooling, immersion cooling, and a focus on waste heat reuse are critical considerations. VIRTUS is actively exploring these through recent acquisitions and partnerships, such as the acquisition of Firums by ST Telemedia, a company specialising in immersion cooling technology.

6. The Role of Edge Computing: Ensuring Connectivity and Latency Sensitivity

Beyond the megascale campuses, the role of edge computing remains pivotal. As companies adopt AI/ML strategies, the demand for edge solutions becomes more pronounced. A fully integrated AI solution requires connectivity to all aspects of a business's systems. While core language models and inference models may reside in megascale campuses, there is an on-going need for edge solutions in metropolitan cities, ensuring full integration.

Edge computing retains its importance for highly latency-sensitive applications such as live broadcasts. Additionally, for some companies, edge data centre solutions are essential for cost-effectiveness. For example, content distribution networks delivered via local edge data centres facilitate seamless iOS upgrades for iPhones, negating the need for individual data centres in every country.

A Transformative Year Ahead

As we navigate these transformative trends in 2024, one thing becomes abundantly clear - the data centre landscape is undergoing a profound evolution. The integration of AI/ML workloads, the redefinition of scalability, and the strategic development of megascale campuses collectively mark a new chapter in the story of data centres. This is not merely about keeping up with demand; it's about steering our course towards a data-driven future that is as dynamic as it is sustainable. VIRTUS stands at the forefront, ready to embrace the challenges and opportunities that lie ahead.