What Google shows us about the data centre industry's economic impact

What Google shows us about the data centre industry's economic impact

There are plenty of studies available about the impact of digital transformation and cloud computing.

Written by Neil Cresswell, CEO, VIRTUS Data Centres Published Monday, 28 October 2019 11:04

There are plenty of studies available about the impact of digital transformation and cloud computing. We all know that digitalisation is the defining challenge and opportunity for our economy today, providing the means to reinvent and improve how businesses, consumers, governments, and citizens interact and do business with each other.

As technologists, we’re also now pretty well versed in the idea that the data centre is the lynchpin behind these innovations. As organisations explore digital transformation, they need an environment that is inherently flexible, where they are able to innovate and grow - whilst still supporting core applications and protecting mission-critical data. In short, if organisations can get their data centre strategy right, then they have an intelligent and scalable asset that enables choice and growth. But, if they get it wrong, it becomes a fundamental constraint for innovation and change.

What’s less well discussed, is the wider economic impact of data centre construction and management. And that’s why we were so interested in the report from Copenhagen Economics on Google’s Hyperscale Data Centres.  We often talk about the cost of building, maintaining and investing in data centre capital, but less so about the flipside: how data centre investments have converted into economic and employment benefits for European countries.

Using Google as a case study, this report considers the true economic impact of its data centre investments. On one side of the coin, it considers elements like network connectivity and what investment in infrastructure delivers to society; on the other, it considers the environmental impact of data centre, and how the industry has to offset its impact and can lead the way on energy efficiency and renewable energy. Google is a great example of environmental responsibility in action - achieving a 100 per cent renewables target and the largest corporate backer of renewables - supporting PPA deals.

The figures are impressive. Google investments have supported economic activity in Europe of EUR 730 million per year in gross domestic product (GDP) over the last decade. In addition, Google’s investments have supported 9,600 jobs per year on average (full-time equivalents), across the value chain and a wide set of European industries.

The report also shows the considerable investment and infrastructural organisation behind the scenes at Google - it researches what is going on 24 / 7 in the background of a large-scale data centre build and what impact it’s having on the wider world.

While studies like this are really useful to define the here and now, we must also consider the future of the industry. We know that advances in the areas of power, cooling, telecommunications, Artificial Intelligence (AI), operations, hardware and software are transforming enterprise data centres as never before - and this is rapidly fuelling growth. But organisations are also considering the potential impact of outside factors such as Brexit - and whether they will affect the pace of growth in the industry.