Data Centers Are the Least of Iceland's Worries

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Officials in Iceland have been actively seeking to establish the country as a major hub for data centers, citing its abundant supply of cheap geothermal power. Economic development staff have attended several recent industry events to educate data center end users about Iceland’s advantages. Microsoft and Cisco are reported to have visited Iceland to size up its potential to support a major data center.

But Iceland now appears to be effectively insolvent, with its major banks closed and customers unable to access their accounts. As the country’s currency plunges in value, the crisis is spreading beyond its shores. Iceland’s biggest banks have racked up foreign debts equivalent to as much as 12 times the size of the economy.

The British government has been forced to guarantee all customer deposits by UK citizens at the Icelandic online bank Icesave. “The Icelandic government, believe it or not, have told me yesterday they have no intention of honoring their obligations here,”‘ Darling told the BBC. The UK government may take further action to protect at least 20 British municipalities with tens of millions of pounds on deposit in the failed Icelandic banks. The government of Iceland is reportedly seeking a loan from Russia.

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.

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  1. Turns out Iceland wasn't quite the "Data "Switzerland" it appeared to be. Too many tentacles into old world banking. Oh well - wait a year or two. There still might be an opportunity, if Iceland's bailout is solid and everyone else suffers some form of insolvency. Iceland has a unique 3rd Party geographic and cultural position.