2008: Breakthrough Year for Containers?

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Executives at Rackable (RACK) say 2008 will be a “breakthrough year for containerized data centers” and predict that the company will deploy at least 20 of its ICE Cube portables this year, and perhaps as many as 50. The company discussed the prospects for its container products during yesterday’s earnings call with securities analysts.

Yahoo (YHOO) became the latest big Internet company to begin using a modular data center in a container, deploying one of Rackable’s ICE Cube units to support the M45 Supercomputing Project with Carnegie Mellon University. The M45 project provides universites with access to a supercomputing platform which boasts 3 terabytes of memory, 1.5 petabytes of storage, and a peak performance of more than 27 trillion calculations per second.

Rackable also will ship three ICE Cubes to federal customers, and says there’s more to come. “There is no doubt that from what we are seeing right now, ’08 will be a breakthrough year in containerized data centers,” Rackable CEO Mark Barrenechea said in the earnings call.

The focus on modular data centers is part of a broader shift at Rackable, which says it will have lower revenues in 2008 as it discontinues some low-margin deals. “It’s obviously related to margin cost and distraction to other areas of innovation,” said Barrenechea. “When I look out to new workloads, we want to focus our resources on new style data centers like the Ice Cube.”

While companies always like to predict growth in critical high-margin business lines, Rackable’s hopes for ICE Cube align with a broader transition in which container-based data centers are gaining traction.

Rackable didn’t get into details on customers. But Microsoft’s plans may loom large in the fortunes of Rackable’s ICE Cube modular data centers. Microsoft is clearly keen on containers as a solution to its high-density infrastructure challenges. It also has been a big customer for Rackable servers and racks, and has said that it is working closely with vendors on new approaches to the data center.

Is Microsoft the prospect driving Rackable’s upper-end projection of shipping 50 ICE Cubes this year? Given the alignment of the two companies’ interest in containers, it will be news for Rackable if it ships a bunch of ICE Cubes to Microsoft, or if it doesn’t.

About the Author

Rich Miller is the founder and editor-in-chief of Data Center Knowledge, and has been reporting on the data center sector since 2000. He has tracked the growing impact of high-density computing on the power and cooling of data centers, and the resulting push for improved energy efficiency in these facilities.