The US is the data center location of choice for the world’s hyperscale cloud and Internet giants

The US is the data center location of choice for the world's hyperscale cloud and Internet giants

Despite the rise and rise of major datacenter hubs in countries like Ireland and the Netherlands, more than half of the world’s hyperscale facilities are located in the United States.

That’s according to market watcher Synergy Research Group, which released data on the 19 hyperscale datacenter footprints of the world’s largest cloud and Internet services provider. Its findings confirm that 53% of the world’s hyperscale facilities are in the US.

“Despite a years-long push to locate major datacenters within a larger geographic footprint, hyperscale infrastructure is still heavily concentrated in a few hot spots,” said John Dinsdale, a principal analyst at Synergy Research Group. “The U.S. is still home to more than half of the world’s operational hyperscale infrastructure, while Virginia The state is home to 35% of US hyperscale capacity, most of which is concentrated in a small part of the state bordering Washington DC.”

Cloud and Internet giants with a presence in Northern Virginia include Amazon Web Services (AWS), Microsoft, Facebook, Google and TikTok parent company ByteDance.

“Outside of Virginia, the West has the largest amount of US hyperscale infrastructure, thanks primarily to Oregon and California, followed by the Midwest, with the main hot spots in Iowa and Ohio,” Dinsdale said.

The number of hyperscale facilities in the world now exceeds 800, as at the end of the second quarter of 2022, with the remaining 47% split evenly between Europe, China and the rest of the world.

Where Europe is concerned, Ireland leads the way with the highest concentration of hyperscalers, followed by the Netherlands, Germany and the UK. In the Asia-Pacific region, most facilities can be found in China, with smaller hubs in Japan, Australia and Singapore.

In deciding where to locate their hyperscale facilities, Dinsdale said, there are many factors that need to be considered and will dictate why some locations are preferred over others.

“Hyperscale operators consider many factors when deciding where to deploy their datacenter infrastructure,” he said. “These include availability of suitable real estate, cost and availability of power supply options, proximity to customers, risk of natural calamities, local incentives and approval processes, ease of doing business and internal business dynamics.

“This has inevitably led to some hyperscale hot spots. In Europe, the Netherlands and Ireland have always punched well above their weight, beating larger economies like Germany and the UK.”

But looking ahead, Dinsdale said the list of preferred locations could be very different in the coming years: “Our analysis of the future datacenter pipeline shows that the relative importance of these hot spots will decrease somewhat over the next five years, as hyperscale infrastructure expands to a larger geographic footprint.”

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