04.08.2020
By Markets Media

Data Centers Step Up

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As businesses and individuals adapt to the new Covid-19 normal of remote work, one behind-the-scenes technology player has especially demonstrated its value proposition: the data center.

With the vast majority of employees in New York, London and other major financial hubs working from home until further notice, internet usage has spiked, as has demand for the cloud services that are enabled by data centers. Data centers have responded to the task  — with no significant reported outages or downtime to date, industry-wide.

Bill Fenick, Interxion

“The world is very reliant and dependent on infrastructure,” said Bill Fenick, Vice President, Enterprise at Interxion, a data-center operator and connectivity hub. “We’re reading daily about how cloud is expanding through this remote working period. Data centers are the platform for that.”

Amid the global pandemic that is Covid-19, the utility of data centers goes beyond financial services. New York Gov. Andrew Cuomo declared data centers essential businesses that must stay open, and the UK government formally recognized data center staff as key workers.

“People understand the importance of data centers not only because of remote working, but the appreciation that hospitals are relying on them for their medical records,” Fenick said. “Academic institutions are using them to run artificial intelligence tests and analysis trying to come up with a vaccine.”

Just five companies captured 70% percent of the revenue in the 2019 $100 billion public cloud market: Amazon Web Services, Microsoft Azure, Google, IBM and Alibaba. That’s according to Syracuse University professors John Jordan and Lee McKnight, who co-wrote an April 1 blog post entitled ‘Suddenly Essential Infrastructure: Cloud Computing Resources at the Forefront of the COVID-19 Crisis’.

Collaboration, conferencing and digital workplace tools that have become ubiquitous amid Covid-19 lockdowns include Zoom, Slack, Microsoft Teams, WebEx, and Google Classroom. And of course on evenings and weekends there’s always Netflix, which Jordan and McKnight described as “basically a cloud content distribution service.”

“The robustness of the public cloud supporting those now essential tools has been proven in recent weeks,” Jordan and McKnight wrote. “It is difficult to conceive of the scale of these companies’ data centers…The complexity of managing them is significant.”

The global pandemic is impacting the world of technology in multiple ways, perhaps most notably by underscoring the need for digitization, and prompting those who have been slow to digitize to accelerate efforts. This trend falls squarely in data centers’ wheelhouse.

“Covid-19 is pushing enterprises to think about digitization, how to get things on digital,” Fenick said. “For enterprises that are not doing that, are they going to lose customers or perhaps even go out of business? If they’re not digitized, most likely their communication is failing in the current situation.”

As for the future, Covid-19 will be gone one day, but its legacy might be that more people work from home more frequently than they used to — making data centers more critical for potentially the long term.

“Do investment bankers and retail brokers need to pack themselves into the tube to get to the office at 8 am and sit in the same place as each other?” Fenick asked. “The technology is good enough that we don’t all need to travel to see each other on a daily basis. Maybe once or twice a week is good enough.”

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