Source URL: https://www.theregister.com/2024/08/21/dc_na_boom/
Source: The Register
Title: All that new AI-fueled datacenter space? Yeah, that’s mostly ours – cloud giants
Feedly Summary: Construction surged 70% … with 80% already snapped up
The number of bit barns currently under construction has exploded in the wake of the AI boom, surging nearly 70 percent in North America’s top markets over the past year to a record high of 3.87 gigawatts, according to a newly published CBRE report.…
AI Summary and Description: Yes
Summary: The text provides insights into the burgeoning demand for datacenter capacity driven by the AI boom, highlighting significant growth in North America and the challenges posed by power shortages and infrastructure delays. The implications for security and cloud service dynamics are notable, particularly concerning resource allocation and the operational capacity of hyperscalers.
Detailed Description:
The document outlines the rapid expansion of datacenters in North America, largely fueled by the increasing need for computational resources spurred by advancements in AI. However, this expansion faces serious challenges in terms of power supply and the necessary electrical infrastructure. Here are the key points:
– **Surge in Datacenter Construction**: There has been a 70% increase in datacenters under construction, reaching 3.87 gigawatts of capacity.
– **Regional Growth**: Atlanta and Texas (Austin and San Antonio) have emerged as significant growth areas, with Atlanta showing a 76% increase year-over-year.
– **Capacity Shortfalls**: Although new capacity is being constructed, it is reported that 80% of it is already reserved for major cloud providers and hyperscalers, limiting opportunities for smaller entities.
– **Current Vacancy Rates**: Major markets currently report a very low vacancy rate of 2.8%, with some secondary markets showing nearly 10% availability.
– **Rental Price Dynamics**: The rental costs in primary markets have risen 7% in the first half of 2024, reflective of high demand and low supply.
– **High-Performance Computing Impact**: The demand, particularly for high-performing GPUs necessary for AI applications, is increasing construction costs and altering infrastructure requirements.
– **Future Outlook**: Secondary markets are predicted to see expansion due to lower land and power costs, even as the physical development of these facilities encounters delays due to a lack of essential electrical components.
– **Preleasing Needs**: Businesses looking to secure capacity are advised to prelease space 2 to 4 years in advance due to constrained supply.
This information is particularly relevant for professionals in the fields of cloud computing and infrastructure security, as it underscores the implications of resource bottlenecks that affect the cloud service landscape and the necessary security measures for newly developed datacenters that must support high-performance applications, including those used for AI workloads. The dynamics of supply, demand, and pricing in this sector are critical considerations for ongoing risk management and strategic planning in cloud and infrastructure security.