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June 29, 2011

Geographic location is the key for sustainable cloud computing: Gartner

Rising data centre operational cost could increase cost up to 50%

By CBR Staff Writer

Geographic location is the key to more sustainable cloud computing services for outsourced data storage and services, according to a report from IT research firm Gartner.

The research firm has estimated that up to 50% increase in operating cost costs are associated with heating and cooling of data centres.

The research points to substantial (greater than 30%) potential savings in operating costs relating to electricity usage when efficiency design principles are incorporated, as well as lower upfront capital costs.

Gartner research vice president Marcus Blosch said just as labor arbitrage has driven some aspects of business process outsourcing activities, emissions arbitrage will play an increasingly significant role for outsourced IT storage and services.

According to Gartner, around 92% of Australia’s energy is sourced from fossil fuels which makes it less conducive to the development of a long-term green IT services sector, while New Zealand is comparatively green, classed as a low-emission intensity country.

Considering the vast and established renewable energy sources such as geothermal, wind, tidal and hydro power in New Zealand, it could provide a substantial content-based economic model for development of IT storage and services.

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"We anticipate that the parallel growth in sustainable service differentiation and the risks associated with future costs on emission-intensive electricity, will result in growth in globally distributed IT services in geographies that can boast an established blend of electricity generation dominated by low-emission sources," Blosch said.

"Vendors and end users will likely remove risk from some of the activities by moving away from established markets in emission-intensive geographies.

"Given some concerns relating to data latency in some low-emission countries, it might be possible to leverage these countries into a network of IT service regions. Data storage and services from a low-emission hub could support the assessment of cloud services from adjacent high-emission intensity areas."

Factors such as longer-term availability and cost of electricity; communications infrastructure and data latency issues; data privacy; the presence of a local skilled IT services workforce; and an advantageous local taxation regime are needed to be considered when looking at geographic location.

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