The Stack Archive

Cold-country data centres rated most attractive to business

Wed 6 Jul 2016

The latest version of an influential survey which ranks data centre locations worldwide shows a massive shift of the core rankings since the previous one three years ago, with colder countries, including Iceland, Norway and Switzerland, stealing the top slots from the UK and the United States.

Cushman and Wakefield’s Data Centre Risk Index reflects three turbulent years since business was last asked where in the world it would prefer its data be stored, and green concerns are only part of the reason why DC location desirability seems to rise as a nation’s temperature drops.

The top 10, derived from a survey of over 4,000 clients around the world considers ten factors including energy cost, average internet bandwidth, levels of corporate tax, ease of business facility, availability of water and political stability.

Based on these factors, those surveyed ranked the top 10 most preferred data centre locations as:

1 – Iceland
2 – Norway
3 – Switzerland
4 – Finland
5 – Sweden
6 – Canada
7 – Singapore
8 – Republic of Korea
9 – United Kingdom
10 – United States

There are many European and other intra-national agreements and incentives that would indicate both compliance and running costs as a factor in preferring colder-clime environments, but the report indicates many other factors to explain the radical reassessment of nations in this year’s list.

Though high-temperature nations such as Nigeria, India, China, Turkey and Indonesia are the lowest-rated entries, the report explains the extent to which both political issues and geographical stability (i.e. probability of natural disaster) has influenced the shifted rankings.

‘With Europe attributable for approximately 20% of the global data centre market the Nordics only accounts for say less than 2% globally – if we add Canada into the mix this would potentially rise to say just 3%. While this reveals that proximity to market remains the key picture we do anticipate that these locations will develop a wider data centre platform – they must with sustainability measures and demands continuing to move up the agenda.’

Not the least of business considerations in terms of data centre location is governance, which has become a huge issue in the three post-Snowden years since the previous report. In the light of the increasing conflict between major tech players (such as Microsoft and Apple) and the governments which want unfettered access to their data, the relative neutrality of the top five ‘cold’ host nations – though not as nationally committed as Germany to protecting data from international concerns – is one of the clear signals from the survey.

However the authors note the tension between cost and security, among many other factors – including tax concessions – which makes any particular country appealing as a data repository.

At no.7, high-temperature Singapore bucks the trend notably, presumably due to its massively-invested infrastructure, its political, western-style distinction from its major Asian neighbours, its pivotal geographical advantage as a data destination in APAC, and its distinctive lack of contention with western powers. South Korea and Hong Kong (the latter rated 11th) are similarly profiled and similarly favoured.

It may additionally be no coincidence that the U.S. and the UK, both bumped so far down the list since 2013, end up paired in their new positions – a possible reflection of the (some might say notorious) legislative and tacit ‘special relationship’ between the two countries.


business Canada Data Centre Finland Iceland Korea news Norway Singapore Sweden Switzerland U.S. UK
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