UPDATE: Google has contacted us to say that it has not changed the scope of the Lenoir project, and the local newspaper article cited in this post is incorrect. See our July 19 update for the full story.
Google is already expanding the scope of its data center project in Lenoir, North Carolina, and may triple its total local investment to $1.8 billion, according to the Lenoir News-Topic (link via John Rath). When Google announced the new data center in January, the project’s price tag was $600 million. Google initially bought 215 acres of land for the Lenoir facility. But the News-Topic reports that construction has already exceeded the original expectations:
The company, which is building a large data center off N.C. 18 between Harrisburg Drive and Virginia Street, visibly has increased its footprint in the area. For one, the size of the data center currently under construction is now much larger than originally thought, stretching from N.C. 18 along Harrisburg Drive toward Overlook Drive. A second construction area, located above the site and linked by a recently-completed bridge, is currently being prepped for development. “We pour an upper pad to prepare the pad for a second facility,” Google Public Relations Manager Barry Schnitt said. “Once the second is done, we pour a pad for a third. We never said how big each one was going to be. … The whole pie is getting bigger.”
A public records request by the Lenoir paper revealed that plans filed by Google include the option to expand the project by purchasing additional land for up to three huge data centers, bringing the total value of the Lenoir investment to $1.8 billion. Google’s original plans called for that expansion to take place over time, but the company appears to have accelerated its timetable.
That would explain a trend in Google’s subsequent data center announcements, in which it has purchased progressively larger tracts of land in Goose Creek, South Carolina (520 acres) and Pryor, Oklahoma (800 acres) and Council Bluffs, Iowa (1,185 acres). Google CEO Eric Schmidt provided some context for that trend in an April interview with Wired:
There are a few very large (data centers), some of which have been leaked to the press. But in a year or two the very large ones will be the small ones because the growth rate is such that we keep building even larger ones, and that’s where a lot of the capital spending in the company is going.
As any headline-watcher knows by now, Google has also been aggressively investing in acquisitions to expand its service offerings. Since last November, Google has spent more than $5.5 billion acquiring YouTube, DoubleClick, FeedBurner and now Postini, along with 11 other small companies in which the deal price was undisclosed.
How do these deals relate to the data center building program? Google was in the late stages of its planning for the Lenoir project when it acquired YouTube, which now accounts for 10 percent of all Internet traffic and 20 percent of all http (Web) traffic. The bandwidth and storage requirements for YouTube would appear to be a factor in the supersizing of Google’s data center projects.