As organizations consider co-location facilities and the risk/benefit equation of renting their infrastructure as opposed to building their own data centers, it becomes more and more important to know exactly what these huge facilities offer to potential customers. While controlled environments, advanced security features, and the ability to scale are powerful inducements to taking the leap, many companies hesitate to cede that much control over their data. Cloud data centers are still uncharted territory for many, so let’s take a look at what goes into one enterprise-class IaaS provider.

SingleHop is a hosting company from Chicago that supplies dedicated hosting, IaaS, and other services. Despite being a young company (founded in 2006), SingleHop has over 4,000 customers and 10,000 servers in 114 countries, and it’s won a stack of awards. Singlehop is branching out — it’s opening a European data center in Amsterdam, joining the collection of IaaS providers in EMEA. If SingleHop is doing so well, why bother opening a data center in the middle of the European market?

The European market

The European cloud computing market is huge and, according to the IDC, it’s growing — it will generate millions of jobs and billions of Euros in revenue by 2020. Google built the Hamina data center in Finland, Facebook are building the Luleå Data Center in Sweden, and Salesforce will build a data center in the UK next year. Most of the space in the new SingleHop Amsterdam data center was sold before it even opened.

The big deal about a big data center

The barrier to entry to the data center market is a pretty major obstacle. A data center is a controlled environment. The air is controlled, with all that unwanted damp and dust removed. Visitors are controlled, with single-person security gates, retina scans and guards. The temperature is controlled — cold air is blown in by huge air conditioning units and hot air is blown out by thousands of server fans. The power is controlled by massive UPSs and PDUs.

Data centers have fantastic power networks. They are connected to the power grid, have backup generators and rooms full of backup batteries. Terremark’s Nap of Amsterdam has 6,000 KVA power, 6 2.25MW backup generators and 100% power SLA.

A data center is expensive to run, and the biggest single cost is electricity. A data center uses a vast amount of juice. Facebook’s Prineville data center, in Oregon, used a whopping 532M kWh in 2011. Sucking up a huge amount of electricity leads to huge bills. Also in Oregon, Google’s data center in The Dalles, has an annual electricity bill of roughly $13 million.

Data centers have fantastic data networks. Interxion Cloud Hub in Amsterdam is connected to 40 ISPs and 2 Internet Exchanges. SingleHop service customers in Europe, Asia and northern Africa from their new Amsterdam data center.

Data centers take up a lot of space. A data center is no longer just a server room with less than 20 racks. Apple bought 160 acres of land to build its new data center in Oregon.

A data center may contain many rows of equipment racks, containing thousands of physical machines. Softlayer’s AMS01 data center in Amsterdam has room for 8,000 servers. The size of the SingleHop data center is over 4,300 square meters.

The data center owner lays on all this power, space, networking and security for its customers. Data center space does not go direct to residential users — it is rented out in sizeable chunks to other businesses. A reseller can rent data center space, chop it up, and sell it on as massively shared web hosting, virtual machines, or SaaS. SingleHop customers include HSPs (Hosting Service Providers), game developers, and e-commerce vendors.


So why set up a data center in Amsterdam? It’s a big city in the Netherlands, but so what? What’s Amsterdam got to offer to IT companies?

Amsterdam is a major European hub for just about everything. The huge Schiphol airport shifts 50 million passengers a year. The Port of Rotterdam shifts 450 million tons of goods a year. Many data centers and hosting providers have already made Amsterdam a major Internet hub. Amsterdam has brains, money, and great connections.

Taking the leap

SingleHop’s new data center is only one example of the kinds of facilities being built around the world in an increasingly competitive market for IaaS and other cloud service providers. It remains to be seen how accurate the predictions for continued growth in the cloud computing market will be, but rest assured, many companies are laying the groundwork for global expansion.