How to Measure the Data Center Market – Data Center Fundamentals


Manage episode 311276973 series 3082496
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Below we’ll lay out exactly how we do it at datacenterHawk. At the end of this article, you’ll be able to take our approach and put it to use to help you succeed in your new role. What Data Center Market Research Can Do For You For some, data center market research might be a bit of an ill-defined, fuzzy term. Put simply, market research helps people understand how a certain product or industry is performing. Data center market research can help answer questions like: How much are people selling? How much are people buying? What price are they paying? What trends should I care about to help me make better decisions? Where should I take my business next to give me the best chance of success? Gathering Data You can find data from lots of different sources. Start with information from data center provider websites. They’ll typically list the facilities they operate, where they are, their capacity, and other infrastructure details. Brokerage reports from companies like CBRE or Cushman Wakefield are also great sources of market data. There are also data center market research firms dedicated to providing data and analysis. Many firms offer purchasable reports that they produce on a yearly cadence. Other companies have built online platforms that are easy to use and are constantly updated with real-time data. This is what we’re continuing to build at datacenterHawk. There’s nothing wrong with using good old Google to find out what’s going on. Frequently there will be press releases or announcements whenever a provider is expanding a facility or campus. You can also find announcements across social media. Standardizing the Data As you research capacity data, you’ll want to be pressure testing each data point as it comes in. For example, it’s fairly easy to find press releases about a provider adding a MW to a specific data center. But having 1 MW commissioned or available right now is very different than it being under construction or even just planned. Frequently this portion of the announcement is left off and you need to do some additional digging to figure out what they’re really saying. We recommend you only count commissioned and available power for the most accurate view of the market like we do at datacenterHawk. Verifying the Data As you piece together your market data, you’ll also want to pressure test how reliable the data is. Some firms will extrapolate their numbers with a top-down approach. This means they gather a few sample data points and assume the rest of the market shapes up along the same lines as their sample data. This is great for getting a quick read on the market but isn’t as bulletproof as a bottoms-up approach. With a bottoms-up approach, you go facility by facility in every market and roll up those capacity figures to the national level. This takes a lot more time than going top-down but it’s much more reliable. At datacenterHawk we take the bottoms-up approach to building our market calculations and we do it that way each and every quarter. Just Talk to People Some data just isn’t on the internet. It takes going to conferences, traveling to see people, and helping everyone you talk to along the way. The great part about this is you get to build deep relationships with the people in the space. We’ve even had lots of them on our podcast to talk about what’s transpiring in the industry. If you’re new, we’d love to talk to you too and see what we can do to point you in the right direction. You can also subscribe to our monthly update to get more great content like this along with hard data on the market.

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