New Jersey: Wall Street's Secret Data Center Hideout
The month of August was wildly volatile for world financial markets. As September begins, stock markets in Asia are down and Wall Street has reacted accordingly to the bad news. New York City's financial professionals rely on real-time access to all of this market data—and much of it flows through data centers in Northern New Jersey.
Northern New Jersey is one of the top five data center markets in the United States, consisting mainly of large colocation providers and single tenant enterprise users. The majority of activity has occurred in Jersey City, Weehawken, Secaucus, Piscataway, and Clifton. Their relatively close proximity to Wall Street has driven growth from New York City-based financial powerhouses.
Thousands of miles of fiber installed by over a dozen private and public entities sprawl under Northern New Jersey to provide fast connectivity. In fact, data centers for the big stock exchanges—NYSE, NASDAQ, and BATS—are all hosted in Northern New Jersey. This means latency is actually reduced by colocating in suburban New Jersey as opposed to downtown New York City. Northern New Jersey also serves as a landing point to the undersea Internet cables running between North America and Europe. This direct connection to Europe's financial hubs of London and Paris is a key factor in the sustained growth of the Northern New Jersey's network connectivity.
In addition to fiber infrastructure, Northern New Jersey's electric grid provides stable power to data centers. The issues of supply and regulation make Northern New Jersey's electricity costs some of the highest in the nation. However, the rates are significantly less than the average cost across the state line in New York. Data centers use so much electricity that a significant savings on electricity in New Jersey easily justifies the move. Wall Street put the electricity costs to operate a data center 24/7 in NYC up against Northern New Jersey... and the Garden State won.
Some of the colocation industry players datacenterHawk are watching in the Northern New Jersey data center market include: