Editor’s Note: The data center movers and shakers gathered in Hawaii this week to discuss the industry’s future at this year’s Pacific Telecommunications Council’s (PTC) annual conference. Data center expert and Data Center Knowledge contributing editor Bill Kleyman provided his top five takeaways from PTC’s event.
Bill Kleyman, Data Center Knowledge contributing editor, and Data Center World program chair
This was my first time attending PTC, and it was a great experience. Outside of the fact that we were in Hawaii, this conference was filled with data center leaders, innovators, entrepreneurs, and investors. The best part of the conference? It was connecting and learning with so many amazing people. However, there were a few discussions that really stood out.
Sustainability
In a session with Joe Kava (Google), Jennifer Ruch (Oracle), Jonathan Atkin (RBC Capital Markets), and Joley Michaelson (The Sun Company) moderated by Jennifer Weitzel (GLP), we got a very clear message about sustainability, investments, and infrastructure.
We are actively working to create a greener, more sustainable digital infrastructure platform. Beyond concepts like ESG, there is a significant focus on carbon-free computing designs. According to the International Energy Agency (IEA), data centers consume 3% of global power, and about 1% of global emissions come from data centers. The goal becomes a broader focus on the future of energy and creating sustainable data center solutions. The message was clear: innovators and investors care about a data center's design and environmental impacts.
Investing in Digital Infrastructure
Listening to investors help guide the conversations around digital infrastructure was really fun. It was great to see the direct alignment between data center leaders and the investors shaping how digital infrastructure goes to market. On that note, let's focus on a specific session where a few leaders discussed the growth and outlook of the data center industry.
First, we are seeing a lot of volatility in technology. However, the level of connectivity we're experiencing is only continuing to increase. With that in mind, there is a greater focus on how investment dollars are spent. For example, there is more thoughtful due diligence because of higher capital and operating costs, with more discretion towards lower-growth stabilized assets. Hyperscale and data center leaders will drive robust expansion in several markets. Specifically, expect growth in less developed areas like South America, Asia, and Africa. This expansion parallels global 5G deployments, as connectivity is critical in helping rapid digital infrastructure expansion. During the session, Peter Hopper from Digital Bridge put it best: "If the cloud grows, we need more sky."
5G for Emerging Markets
It's essential to stay on one key point from the previous update. Expansion in emerging markets is mainly taking place because of connectivity innovation. 5G deployments in parallel to other digital infrastructure projects allow remote areas to connect to critical infrastructure. This brings us to the next big update: connectivity. Numerous organizations, both in sessions and at the PTC hub, showcased how they connect the world.
Be prepared for more undersea cable projects, fiber deployments on the mainland, and connections into new and emerging markets. If you want to know where the next data center will be built, follow the cable and connectivity providers. Emerging markets benefit from connectivity investments as it helps bring more cities and communities into the digital space. Furthermore, it creates a localized market need for edge and distributed data center infrastructure.
Diversity in Data Center Hiring
A key topic at PTC was also hiring and diversity. At the PTC Beyond event, we heard PTC President Brian Moon discuss just how important it was to have a diverse set of people in our connected industry. There is still a challenge where many don't know what this industry does. As a result, there is misinformation and a disassociation from some to come work in this field.
The message was clear: Be loud in this industry and work to educate others on what we do. Beyond looking for young people, several events at PTC were aimed at specific groups to encourage them to come to our industry. During the Infrastructure Masons Armed Forces event and session, two veterans described how transitioning military personnel are ideal candidates for this industry. Led by Tony Grayson of Compass Data centers and Lee Kirby from Salut Mission Critical, they discussed how military expertise directly translates data center jobs. Specifically, they outlined how transitioning veterans would be great for security, logistics, operations, engineering, management, software, and construction roles. It'll be up to all of us to work to diversify our industry to support future connectivity and critical infrastructure demand.
Private Equity’s Growing Role in the Data Center Industry
Another important update is this: Private equity and investors are getting even more behind the wheel. This was a big message that I heard at this conference.
Leading investors are taking an even more active role in helping critical infrastructure grow and expand. Why is this happening? There is so much opportunity and new markets that it would be silly not to get more involved. These investors are working hard to help data center leaders work with capital more effectively as challenges around supply chain and go-to-market speeds emerge more prominently in our industry.
Something to keep an eye on would be more mergers and acquisitions in the data center space. There are a lot of areas for growth as emerging markets for infrastructure and connectivity offers excellent opportunities to grow a business. However, approaching these new opportunities must be done in a cautious and calculated manner. Expect more updates and interaction from private equity leaders aiming to support and grow the digital infrastructure industry.
