Lies, Damn Lies, and Statistics: Next Generation Data Blog

Lies, damn lies, and statistics

By NGD 04 | October | 2018

NGD’s Commercial Director, Simon Bearne looks beyond the shock horror headlines of a new European data centre pricing report’s (DCP) latest pricing trends survey highlights the ‘ballooning’ prices of third party operated data centres. Out of 15 European countries, the UK, Ireland and Switzerland, it says, are all at the top end of the scale with ‘the highest average pricing, with rack space rates per month of 1,000 euros or more’.

Fair enough, but here’s the thing. Taking an ‘averaging out’ approach with statistics is often misleading. A somewhat broad brush country to country average price comparison overlooks the huge variations in pricing that exists in a major market such as the UK. After all, the London and inner M25 area is the traditional heartland for UK data centres and also the most expensive, so a national averaging across the board will skew the reality quite considerably.

And let’s not forget either what you’re getting for your money. A select few data centres located well outside of the London/M25 area offer high quality facilities at very competitive rates, much lower than suggested in the report.

NGDs is a leading example, providing world class facilities with pricing at easily half that of London due to vastly lower real estate and labour costs. These factors combined with our vast space ensure unrivalled commercial scale economies – bar none.

Power curve

The report also suggests industrial electricity costs vary extensively, with Ireland, Spain and the UK having the highest per kWH rates. Again, drill down further and it becomes evident that power costs can and do vary. There again, NGD’s 180 MW supply is an exceptional case. Our closeness to the grid through a unique direct connection means that power distribution costs are significantly lower. Furthermore, being 100% renewably sourced assists customers with their carbon credentials and ultimate tax exposure. NGD can therefore maintain attractive power prices and keep them as low as possible for our customers.

Connectivity on the up

An interesting observation made in the report is the rise of geographical clusters of highly connected data centres; in cities and metro areas for enabling dense connectivity for supporting increasingly demanding cloud and digital services. This development demonstrates how space, power and cooling have now been joined by connectivity as one of the prerequisites in modern facilities. A data centre can no longer be an island and expect to survive let alone thrive.

However, conjuring up highly diverse connectivity doesn’t happen overnight. It requires investment but also evolves organically with major carriers, service providers and fibre specialists often choosing to connect to certain facilities based on their reputation, strategic location and business value. Fast-track hyperscale connectivity is of course possible but requires considerable investment on the part of the data centre operator. Perhaps this an indication as to why the report has also found the pricing of many of these emerging data centre clusters to be skyrocketing – they’ve got to fund and claw back the costs of the additional capacity required somehow.

NGD, on the other hand, already offers hyperscale connectivity at highly competitive rates. There again, NGD is Europe’s largest data centre campus, we’ve ten years of history behind us, growing organically and profitably by attracting blue chip international customers including some of the world’s largest systems integrators and cloud providers.

These factors and 100% uptime since we started have all contributed to NGD becoming established as a major geographical hub for the UK’s South West and Wales. NGD is a viable and strategically desirable destination for multiple carriers to connect to with dark fibre, not to mention ISPs and major cloud providers. With NGD Connect we also offer direct layer 2 fibre low latency connections to Telehouse locations in London, allowing customers high speed access to racks physically located at our facility in Wales, and seamless connections to leading cloud services via NGD Cloud Gateway.

Enough said. Headline surveys can be misleading. It is still entirely possible to find data centres in the UK that are big on quality, low on price, and highly connected - provided you take a closer look.