While businesses everywhere are closing their doors and battening down the hatches to try and get through the coronavirus pandemic, Data Centers are always working to keep the world’s data processing and storage safe. And especially now, with remote work needs pushing internet data usage to dizzying heights, there are a number of reasons why data centers will continue to forge ahead through the crisis.
4 Data Center Facts During COVID-19 Outbreak:
1. Governments Working to Provide “Special Passes”
As officials all around the world are realizing, with ‘remote work’ being the new norm, digital infrastructure plays an even more critical role in the new economy. But with Covid-19 causing entire communities — New York has just joined California — to issue “stay at home” orders, forbidding people from leaving their homes, solutions will be needed to keep data centers, and therefore, society, running. With that in mind, the UK data center industry is working with the UK government to secure “special passes” for data center workers in places that are otherwise in total lockdown.
2. Tax Breaks
Recognition of the critical importance of data center operations has reached the U.S. in the form of tax breaks. In Idaho, the state senate has passed a data center tax break bill that offers a new sales tax exemption geared particularly towards hyperscale data centers. Expect more states to follow.
3. Rack Offerings
Data centers aren’t hoarding toilet paper, but they should be stocking up on their rack densities. Kilowatts per rack has been edging into double digits this year (averaging about 11 kW per rack, compared to just 5 kW in recent years). Tax breaks or no tax breaks, data centers that are working to provide this type of high-density for the ever-increasing workloads will be the ones that survive.
4. Virus-Resistant Investment
In the face of the pandemic, one sector that remains bulletproof, because its services are needed now more than ever, is the Data Center real estate (REIT) sector. One analysis shows that this sector is, in fact, immune to an economic downturn. BoFa Securities notes “There’s no evidence of a correlation between GDP growth and data center leasing activity.” The pandemic is driving activities like internet shopping and video usage over-the-top, further establishing the data center sector as recession-proof. This is the investment to be in right now.
Investors and consumers should be assured that data centers will be one stable sector in these very unstable times.