Palantir Stock- DCK Must Know: Top Data Center News This Week – July 23, 2021 | Fintech Zoom
Welcome to the week’s roundup of all the biggest news in the data center industry, curated, distilled, and put into context by Data Center Knowledge.
DigitalBridge Eyes Entry into the Asian Data Center Market
Chinese billionaire Richard Li’s conglomerate PCCW has been shopping its sizable portfolio of data center assets, and Boca Raton, Florida-based DigitalBridge has emerged as the strongest bidder, Bloomberg reported.
The report is based on statements by anonymous sources, who also said the potential transaction could value Hong Kong-based PCCW’s assets at more than $600 million. The company operates data centers in Hong Kong, mainland China, and Malaysia, according to its website.
Data centers were a good type of asset to sell even before the pandemic, with the right strategic assets commanding high premiums. But the level of society’s reliance on digital tools during the pandemic made digital infrastructure an even more attractive investment.
- DigitalBridge is the new name of the company formerly known as Colony Capital. The rebrand, announced in June, turned out to have been timely, making it easier to distance the company from Tom Barrack, Colony’s founder and former CEO, who this week was arrested and accused of acting as an agent of the United Arab Emirates.
- Barrack stepped back from Colony’s management last year, handing the reins to Florida businessman and polo star Marc Ganzi. Ganzi has been overseeing the REIT’s pivot from traditional real estate to digital infrastructure.
Azrieli Signals Global Data Center Ambition With Green Mountain Acquisition
After testing the water in the North American data center market with a minority stake in Dallas-based Compass Datacenters, Azrieli Group is making a bigger bet on the market’s global potential.
The Israeli developer and holding company has agreed to acquire Norwegian data center operator Green Mountain for about $850 million, planning to use it as a platform for further expansion in Europe.
Large data center operators have been attracted to Norway, and Scandinavia in general, because of the region’s plentiful hydropower and its cool climate.
- Green Mountain has three operating data centers in Norway. It has 24MW of capacity under customer contracts and enough development sites to expand to 520MW total, according to Azrieli’s announcement of the deal.
- One of its data centers is literally built inside a mountain. The facility is a repurposed former NATO ammunition storage site.
- Tel Aviv-based Azrieli’s focus has traditionally been on building and operating shopping malls, offices, and senior homes. Its first foray into data center investment was a $135 million purchase of a 20 percent stake in Compass in 2019.
- The developer has an ambition to build “international operations in the data centers sector,” its chairwoman, Danna Azrieli, said in a statement.
- Azrieli appears to have opened some doors for Compass in Israel, where the two are now reportedly building data centers for AWS.
Intel’s Hyperscale Data Center Business Slumps Further
The part of Intel that sells its most expensive chips to hyperscale cloud platforms saw a 20 percent decline in sales year on year in the second quarter, the company reported.
That’s the clearest indicator yet of the kind of impact the combination of AMD’s market-disrupting Epyc 2 server chips, introduced two years ago, and the subsequent iteration on the product; hyperscalers’ investments in designing processors for their own data centers; and Intel’s lag in advancing its own manufacturing technology is having on its share of the most lucrative semiconductor market – a market where it enjoyed taking 99 percent of all revenue until only recently.
Intel’s overall server division declined 9 percent year over year, Bloomberg reported.
- Its CEO Pat Gelsinger, however, projected that Intel’s data center business will deliver double digit-percentage sales increases in the second half of the year.
- Since taking the chief executive role in February, Gelsinger has been making big changes at the company to reverse the data center group’s revenue decline.
- One big change was his commitment to become a contract manufacturer for other semiconductor companies.
- That commitment was followed by a restructuring of the data center business, splitting it into a Datacenter and AI Group and a Network and Edge Group. Naveen Shenoy, who ran what used to be called the Data Platforms Group, left the company earlier this month.
Nvidia and Palo Alto Supercharge Virtual Firewalls
With Moore’s Law waning, hardware accelerators are all the rage, and Nvidia is doing everything in its power to get ahead of the curve. Its latest move is a partnership with security vendor Palo Alto Networks to run virtual firewalls on the new Nvidia BlueField-2 DPU co-processor.
The companies announced the partnership recently, and their product and technology leads shared the details and the thinking behind it with DCK’s Wylie Wong.
Enterprises and telco service providers have been happy to replace expensive, dedicated firewall hardware with virtual replacements. But doing that has typically meant accepting lower performance. Offloading the firewall workload to the accelerator solves that problem, they said. No more performance tradeoff.
- Infrastructure management has emerged as a new key workload to rid the server CPU from having to deal with. SmartNICs started the trend, offloading some network management tasks.
- Nvidia’s BlueField DPUs are an uber-powerful take on that idea, combining Arm-powered Mellanox SmartNICs with Nvidia GPUs to take on everything from network to security and storage management.
Supply Chain Crunch Driving Up Data Center Equipment Costs
The bulk of the coverage of the massive supply chain disruptions has focused on the chip shortage they have caused (which, in a vicious cycle, has exacerbated the supply problems), but manufacturers all across the globe are short of much more than just chips.
Data center power and cooling equipment vendors have been heavily impacted, for example. As Rob Johnson, CEO of Vertiv, told us in an interview for The Data Center Podcast, components like fans and lithium-ion batteries are in short supply, and so are materials, such as steel, copper, or plastic.
The disruptions have been pushing up prices of data center infrastructure equipment – at a time when demand for more data center capacity is skyrocketing. Johnson described it as “a perfect storm.”
- While Vertiv cannot reprice orders already in its backlog, new orders are priced on a case-by-case basis, with sales reps using analytics tools to avoid pricing themselves out of a deal while recovering Vertiv’s own costs and keeping shareholders happy.
Other great reads on DCK this week:
Jim Whitehurst Left IBM Because He’d Rather Be CEO – Contrary to what some may have feared, the exec’s departure wasn’t a sign that IBM was trying to make Red Hat more like IBM, reneging on its promise earlier.
Evoque’s Move into Cloud Consulting to Support Hybrid Colocation – The provider powers up its application-centric infrastructure business strategy with a customer hand-holding capability.