The Seattle Data Center Market

The Seattle Data Center Market

Seattle is a steadily-growing data center market. Called the "Jet City" based on its history of aircraft manufacturing, Seattle can also claim the moniker of "Cloud City" thanks to its cluster of cloud computing and colocation businesses. The confluence of cloud infrastructure investments from Microsoft and Amazon, relatively low power costs, and high-performance connectivity options drive continued data center growth in Seattle and its suburbs.

Companies searching for data centers in the Seattle market include those in the aerospace, financial, healthcare, technology, and transportation industries. The Seattle market also has the advantage of an overall mild climate. With water to the west and mountains to the east, Seattle's topography generates months of cool, rainy weather—which then enables months of free cooling for the area's data center operators.

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Power Overview

Seattle's municipal monopoly electricity provider, City Light, is relatively inexpensive compared to other West Coast markets of its size. For customers planning a data center around green IT initiatives, Seattle City Light markets their electricity as "green," generated primarily from hydroelectric and other "renewable" sources such as wind and (inexplicably) solar. In Seattle's suburbs, investor-owned Puget Sound Energy (PSE) is the provider with rates similar to Seattle's. Typical rates paid for electricity serving industrial buildings in Seattle are between two to three times less than in the Northern California market.

Connectivity Overview

Seattle's demand for high-performance connectivity has grown exponentially in the past decade. As the employee count at Amazon and Microsoft skyrocketed, some of Silicon Valley's big tech companies opened offices in Seattle hoping to poach top talent. Internet-centric startups in the area such as Expedia, Zillow, and others have grown and contribute billions to the local economy; resulting in an increased need for enterprise-grade fiber infrastructure throughout the area.

Additionally, Seattle is a termination point for the undersea cables connecting America to the growing Asian market. An existing 8 Tb/s trans-Pacific cable, NTT's Pacific Crossing PC-1, terminates in the Seattle market as will the 60 Tb/s cable under construction for a 2016 launch by a consortium of Asian telecoms and Google called FASTER. A beneficiary of a direct connection to Asia is the Westin Building Exchange (WBX) in downtown Seattle. WBX is a true "carrier hotel," facilitating interconnections between over 150 global carriers, content delivery networks (CDNs), cloud computing companies, academic and research networks, enterprise customers, and data center operators. WBX houses the Seattle Internet Exchange (SIX), a non-profit cooperative enabling low to no-cost route servers and peering for its members. While peering is not a SIX membership requirement, members who peer report an overall reduction in bandwidth costs.

Hazard Risk Overview

By traveling east over the Cascade Mountains to build, data center providers not only benefit from the tax breaks but also from placing their data centers outside Seattle's earthquake zone. Seattle experienced their last damaging event, the "Nisqually Quake" in 2001, and stringent building codes have been instituted since. However, the area's infrequent earthquakes rarely damage buildings or cause power losses. Backup power strategies in Seattle have improved since multiple large-scale commercial and consumer power outages struck the region in 2009.


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