Google Seeking Colocation Space

Google is staffing up to acquire existing colocation space and perhaps even entire data centers, even as it continues building.

Rich Miller

March 6, 2008

2 Min Read
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Google is staffing up to acquire existing colocation space and perhaps even entire data centers. This is an interesting development, since the company already has four massive data center construction projects underway. There are several possible explanations for this:

  • Google (GOOG) is growing so quickly that its own vaunted construction program can't keep pace. This sounds unlikely, but a recent comment by a Google executive suggests it's possible.

  • Google will buy, rather than build, its data center space as it expands internationally.

  • A third intriguing possibility: Google believes the credit crunch and economic slowdown will make distressed properties available, and is preparing to be an opportunistic buyer of data center assets. The company established itself in the dot-com bust as a savvy lessor of colo space from motivated sellers.

Let's start with a look at Google's staffing plans. In recent weeks Google (GOOG) has posted a job for a strategic negotiator to acquire colocation space in "conventional data centers," and another for a specialist to negotiate "leases or purchases of data center facilities and/or properties capable of conversion to data center purposes." There are jobs for a data center acquisition program manager, and a specialist in data center power contracts.

Google currently has immense ground-up data center construction projects underway in North Carolina, South Carolina, Oklahoma and Iowa. At $600 million apiece, that's $2.4 billion in new construction. Google is known for building its own infrastructure, including everything from web server software to 10 Gig Ethernet switches. It clearly believes its in-house data centers are a competitive advantage. Google has always leased some of its data center space, but in recent years has reportedly limited its use of third-party colo in favor of its own customized facilities.

Google is building data centers in Europe and seeking sites in Asia, where it presumably would also build its own facilities. But leasing colo space in overseas markets would let Google grow quickly, while retaining the option of eventually shifting gear to its own facilities. Some of the colo leasing appears targeted for international markets, as the data center negotiator will be expected to travel 50 percent of the time, and international experience is described as "highly beneficial." Read more ...

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