Thursday, May 23, 2024 May 23, 2024
72° F Dallas, TX

CyrusOne and the Largest Data Center in Texas

When it comes to our consumption of digital information, the figures are stunning.
photography by Trevor Paulhus

Gary Wojtaszek taps the brakes and parks his golf cart as he talks about the growth of the Internet. It’s the end of our ride; we’ve just gone nearly a quarter of a mile in a straight line indoors. We’re in Big Data’s house.

As we rolled through the building, Wojtaszek, CEO of CyrusOne, explained that this nearly 700,000-square-foot monstrosity on Frankford Road in Carrollton will be the largest data center, under one roof, in Texas. It will start taking on clients later this year, and the buildout will continue for three years.

CyrusOne is expected to spend nearly $200 million this year on building out facilities like this one and growing its business. Last year, in comparison, its capital expenditures were around $119 million. Analysts say that level of spending should yield about 200,000 square feet of finished data center space.

CyrusOne is estimated to have about 88 percent of its capacity in use now; the additional spending will bring that utilization capacity down to the data center industry norm of about 70 to 75 percent.

At the end of 2011, CyrusOne reported $49 million in data center revenue, with a 25 percent increase coming from its Texas-based operations. It counts 75 Fortune 1,000 companies as customers. Its growth is coming so fast, the Houston-based firm’s parent, Cincinnati Bell, is weighing whether to spin off the company as a separate entity in order to unlock shareholder value.

Anyway, this Carrollton facility is huge, and I think it’s amazing that this is just one of several local data containers and information nerve centers in this Internet-fueled world. As data keeps growing, more facilities like this will come online all over Dallas-Fort Worth, most in generic-looking buildings, hiding in plain sight. Research firm IDC projects that the demand for servers will double by 2015. Storage vendor EMC says that during the next decade, there will be 10 times the number of physical and virtual servers we have now.

The need for that hardware is part of the information explosion. The amount of information managed by enterprise data centers, like the one CyrusOne is building, will grow by 50 times; the number of files each data center will have to secure and house will grow by a multiple of more than 75.

No matter who you ask about data consumption, the figures are stunning. Networking vendor Cisco Systems projects that the number of households generating more than 1 terabyte per month of Internet traffic will reach 1 million by the end of this year. Internet traffic will reach 9 gigabytes per capita in 2015, up from 2 gigabytes per capita in 2010, according to Cisco. To put that in perspective, Internet traffic was at about 1 gigabyte per capita in 2008.

Even with all the advances in virtualization, solid state storage, and data and video compression, this Carrollton building that looks like an airplane hangar now will be full before we know it. I wonder if even CyrusOne can keep pace.

When the company’s Carrollton data center is finished, it will include about 60,000 square feet of office space and 400,000 square feet of raised floor data center space, where cords and air ducts will snake underneath hundreds of racks of running servers to keep them switched on and cool. Titans of industry and startups alike will be able to scale their operations to meet their computing and storage demands, all while keeping an eye on their stuff.

One Way Out
For a contrast, I took a walking tour of CyrusOne’s Lewisville data center, which is one-sixth the size. You couldn’t just ride up to these big rooms with cages of servers in a golf cart. First, you have to get by the man trap.

The man trap is a security pod with interlocking doors, and it’s the only way in or out of CyrusOne’s Lewisville data center. Weight sensors in the floor and metal detectors in the side of the structure prevent weapons from coming into the facility, and hardware—or anything else—from leaving unexpectedly. During smoke breaks and shift changes, expect a backlog.

Physical security is present everywhere else in the CyrusOne Lewisville facility. The place is lousy with cameras, biometric door locks, motion sensors, temperature monitors—and this is just the stuff I can see without my tour guide’s help.

What stands out to me is just how serious the business of securing, powering, and cooling data centers has become. In addition to maintaining normal operations for clients, data center providers must have the ability to grow at a moment’s notice, in case one of their clients is the next Pinterest or Instagram—web applications that have gone from being unknown to serving tens of millions of customers seemingly overnight.

CyrusOne says it designs its centers with that kind of flexibility in mind. It can provide anywhere from 50 to 1,000 watts of power per square foot at its North Texas data centers. And that’s why the cooling is so critical. Wojtaszek likens the data center power consumption to laying hair dryers down every few feet and turning them all on high.

As I noted before, CyrusOne is just one of many companies tackling these problems in the DFW market. All over North Texas, data center space is in demand. Readers of D CEO’s RealPoints commercial real estate news site frequently see announcements about land and building acquisitions from the likes of Digital Realty Trust, CoreSpace, Lincoln Property Co., Stream Data Centers, and others.

In February, Digital Realty Trust acquired Convergence Business Park in Lewisville. The campus includes 10 existing buildings on 168 acres and one of those buildings is another CyrusOne data center. More interesting, though, is the nearly 40 acres of undeveloped land that came as part of the deal; it could accommodate an additional 700,000 square feet of space.

Despite the proliferation of data centers, Wojtaszek says that his biggest competition is still the “unconverted CIO”—the IT executives at big companies who prefer to own every step of the process of taking care of their data. “What we’re selling is trust,” he says. “If you put your gear here, it is never going to go down.”

Back at the CyrusOne Carrollton facility, Wojtaszek and I meet in his makeshift office—a laptop on a folding table in an empty room with a window. I sit in one of the two folding chairs and he offers me some chips from his Corner Bakery lunch. 

Wojtaszek was the CFO of Cincinnati Bell until August 2011. He helped convince management that investing in the data center business would be a good use of the telco’s cash, and that the growth in that sector was just starting.

Giving big data a big home may be just the beginning. With facilities in Houston, Austin, San Antonio, and Dallas, CyrusOne is actively talking about the future of data centers as they take on more importance as central hubs on a network. Later this year, the company wants to launch a statewide Internet exchange linking together all of its data centers in Texas.

The idea, says Josh Snowhorn, vice president and general manager of interconnection, is to provide a giant platform where all companies in all CyrusOne data centers can directly connect to one another. Snowhorn was recruited to CyrusOne in January from Terremark, a Verizon subsidiary that has two data centers in Dallas and one in Irving.

Connections in the same metro area—e.g., a company that has facilities in CyrusOne’s Lewsiville center and needs to connect to a customer in its Carrollton data center—will be free, says Snowhorn. The cross-state connections will incur a charge, but not as much as a company would rack up trying to interconnect to several different firms individually.

With a statewide exchange, Snowhorn says, a company pays a fee to connect to CyrusOne. The costs and facilities to connect to any other Cyrus-One customer in the state will be lower—and the connections more direct—than they would be if that company weren’t a data center client, Snowhorn says.

For content companies trying to get video and web-based information closer to customers, the ability to use Dallas as a gateway to all the major markets in Texas could be an attractive reason to take up space in CyrusOne’s new location.

By facilitating these connections among the state’s major corporations, the connectivity costs for each company drops and the customers are happier overall, Wojtaszek says. That extra connectivity service may help sway some clients, especially as cloud computing becomes more of a factor in business-to-business communications (which this column covered in detail in the October 2011 issue).

“We want to be the sky that contains all the clouds,” Wojtaszek says.

More and more, businesses are starting to see his point. Analysts at JPMorgan say the cost to build and maintain a Tier-1 data center has grown to the point where it can run between $1,000 and $1,500 per square foot.

As CyrusOne builds more and newer facilities, and interconnects them, Wojtaszek goes back to chief information officers and does what he does best: argue the numbers. “CIOs cannot match the operating efficiencies they will get from using us,” he says. “Capital is so dear now, that more and more corporate boards are saying, ‘Why are we building our own data centers? This isn’t what we do.’”

Phil Harvey is the editor of Light Reading, a UBM TechWeb publication covering telecommunications. He’s @futurephil on Twitter.