Friday, October 30th, 2015

Time	Event
12:00p	Digital Realty Takes Foot off Brake Pedal on Expansion After 18 months of optimizing its portfolio, reshaping its business strategy, and completely transforming its senior leadership team, Digital Realty Trust is back in expansion mode. The company is planning to expand data center capacity in its current markets and enter new ones after 1.5 years of almost complete construction abstinence. Data center demand is up, and with the addition of Telx to the business and new products Digital is ready to start the next chapter, based on what company executives made on its third-quarter earnings call Thursday. One place where San Francisco-based Digital is focusing its expansion efforts in particular is Northern Virginia, one of the world’s largest data center markets and a key region in the internet’s geography. On the call, the execs announced that the company has bought a 2-million-square-foot property in Ashburn, Virginia, with access to 150 MW of power. They did not get into specific construction plans but said the build-out will support growth for the next several years. The property is close to Digital’s existing Ashburn campus and is one of few green-field sites fit for data center development Loudoun County has left, according to them. Demand Stronger than Digital has Ever Seen Demand for data center capacity overall is stronger today than it has ever been in Digital’s 11 years as a public company, CEO William Stein said on the call. He used Digital’s backup generator deployment dynamics to illustrate the point. “Within the past five weeks, we’ve ordered twenty-three generators and have allocated 15 to projects scheduled for delivery over the next six months,” he said. “Throughout the course of 2015, we’ve allocated … three to eight per month, so this represents a dramatic uptick in our level of delivery.” The number of generators allocated gives Digital “clear visibility into the demand.” It is “perfectly correlated” with the spike in leasing activity the company is seeing in the market, Stein said. Digital signed leases amounting to $33 million in annualized rent revenue in the third quarter. The quarter’s revenue was $436 million – up 6 percent year over year, and net income was $58 million. Wholesale no Longer Means 2N Infrastructure Responding to a recent trend other data center providers have also noted, Digital is expanding the variety of wholesale data center products it offers. In addition to its standard 2N infrastructure redundancy level, the company will now also provide N and N+1 options. There is a lot of demand for lower-cost and lower-redundancy offerings – something Vantage Data Centers, Digital’s competitor in Silicon Valley and Central Washington markets, has been capitalizing on. In a recent interview, Vantage CEO Sureel Choksi said Digital realty invented the wholesale data center business model in its early days, and that model was built around 2N redundancy on electrical infrastructure, and N+1 on mechanical infrastructure. “There was really one product in the wholesale data center industry in its early days,” Choksi said. But Vantage has been successful at closing deals with technology companies in Silicon Valley that in some cases include no redundancy at all. In one multi-megawatt deployment by an enterprise software company, whose name Vantage has not disclosed, there are no generators, uninterruptible power supplies, or batteries. “If the utility goes down, it goes down,” Choksi said. The customer houses its development and testing environment in the facility, so it’s not as crucial for it to stay up whenever there is a power outage. Cloud service providers and big web companies also build more and more failover and resiliency capabilities into software nowadays, so they don’t need as much redundancy in the physical infrastructure layer. In one extreme example, Facebook shut down an entire data center to test the resiliency of its web application, which rode through the test without an outage, Jay Parikh, the company’s head of engineering, said during a presentation in 2014. With less infrastructure, the customer gets a lower-cost lease, and the difference in price matches the difference in Vantage’s cost to deliver the space, so the provider’s profit margin doesn’t suffer, Choksi said. Interxion Acquisition not in the Works Not surprisingly, integration of Telx, the colocation company Digital bought earlier this year, is currently front-and-center for Digital’s leadership team. “Our highest priority is to successfully integrate this $1.9 billion investment,” Stein said, responding to an analyst on the call who said Interxion, a major European data center provider, was still without a “dance partner” in the European market following the acquisition of TelecityGroup, another European heavyweight, by Equinix. Equinix, both a customer of Digital’s and its competitor, bought London-based Telecity for $3.6 billion earlier this year. If European regulators approve the deal, Equinix will become the largest data center provider in Europe. Telx is a direct competitor to Equinix, and by acquiring it Digital started competing more directly with one of its biggest customers than it used to. Telx to Drive Connected Campus Strategy The Telx integration will happen in multiple phases. “It’s far more important to get that right than get it right now,” Stein said. Telx is initially going to operate as a standalone line of business, and Digital is keeping the Telx brand in the near term, John Stewart, senior vice president of investor relations, said in an interview. “Telx will be our colocation and interconnection platform going forward,” he said. The integration will consist of leasing vacant space in Telx data centers that are not within Digital’s facilities, transitioning Digital’s non-Telx colocation assets under the control of the new line of business, and then building out colocation and interconnection data centers within Digital’s existing wholesale campuses in the US, primarily in Ashburn, Dallas, and Chicago. The combination of wholesale space and interconnection is aimed primarily at cloud service providers and enterprises that want to connect to them directly. As enterprise demand for cloud services grows, enterprises need to connect their on-premise infrastructure to cloud providers over private network links. With its connected-campus strategy Digital is going after this demand. The final phase of integration will be taking the model to international markets, Stein said. (Comment on this)
6:08p	What DCIM Tools? You Mean Spreadsheets and Tape Measure? Microsoft Excel is still a wildly popular data center management tool, and one in 10 data center managers walk around the raised floor with a tape measure, according to results of a recent Intel survey of 200 data center managers in the US and in the UK. As much as we like to write about data center automation and sophisticated DCIM software in trade pubs and talk about it in conferences, the reality is close to half (43 percent) of data center managers still use manual processes to do their jobs. This is not limited to small data centers. Manual data center management is still a big hit in facilities that support 1,500 servers and more. The stats put Google’s use of machine learning in data center management to maximize efficiency in perspective, or, more precisely, in the realm of science fiction as far as the bulk of the world’s data centers are concerned. But it doesn’t have to be this way. The most popular explanations for lack of automation are high cost of the tools themselves and the resources needed to deploy them. While those are valid, in Intel’s opinion they “represent false economies in the longer run.” It’s important to keep in mind that Intel is not a neutral observer here. The company’s Data Center Manager middleware broadcasts device vitals, such as server temperature and power consumption, to DCIM software solutions by vendors that partner with Intel for this purpose, and it’s a business the company has been actively promoting in recent years. More than half of manual planners surveyed spend more than 40 percent of their time on capacity planning and forecasting every month. From this, the report concludes that many data center managers are “locked in a vicious circle.” They don’t have the time to implement DCIM tools that automate capacity planning because they’re too busy managing manually. Nearly 60 percent of respondents said they experienced “thermal-related” challenges that impacted operational efficiency in the past year, yet 70 percent of data center managers rely on thermal sensors and spreadsheets to identify hot spots or areas that are overcooled. This doesn’t mean that’s all they use to manage their cooling systems, however. More than 60 percent use analytics capabilities in DCIM software to help optimize cooling efficiency. Another method is hot-spot audits. But operators without DCIM are less likely to do hot-spot audits and cannot employ more sophisticated optimization methods, such as Computational Fluid Dynamics. Only 20 percent use CFD simulation to identify problem areas. DCIM software can also help with addressing space and power constraints and quantifying costs of downtime, according to Intel. It’s hard to say whether the issues of cost and deployment complexity are going to be resolved to accelerate DCIM adoption. Some newer vendors are offering lower-cost solutions, but they’re not as comprehensive as big DCIM software suites that often require a dedicated implementation team to deploy. That DCIM tools are useful doesn’t appear to be a controversial point. What remains a big hurdle – and a deal breaker for many data center managers – is the upfront cost. Full report on the survey here (Comment on this)
6:11p	Weekly DCIM Software News Update: October 30 Gartner publishes its Magic Quadrant for DCIM tools, and a Redshift Research survey sponsored by Intel looks at DCIM practices currently in place in the U.S. and UK. Gartner released its 2015 Magic Quadrant for Data Center Infrastructure Management Tools, a comprehensive look at the DCIM functions and capabilities of vendors in the market. Nlyte Software was recognized in the Leaders quadrant. Panduit was identified as a Visionary. Modius was recognized in the Leaders quadrant. Intel sponsors State of the Data Center report. A Redshift survey commissioned by Intel looked into the DCIM practices of 200 data center managers operating in the US and UK. The report reveals that 43 percent of data centers are still using manual methods for tasks like capacity planning and forecasting. (Comment on this)
8:19p	Canonical Has Snappy Ubuntu Core Win with Open Networking Vendors This post originally appeared at The Var Guy Canonical has announced the first commercial endorsement of Snappy Ubuntu Core, the transactionally updated open source OS for the cloud and embedded devices. The platform will soon power network-control hardware from several vendors. Canonical launched Snappy Ubuntu Core in late 2014. The platform provides a minimalist version of Ubuntu Linux, combined with transactional updates that make it easy to install applications and services on top of the base OS. The transactional update mechanism provides more security than that available on the traditional operating system. It also has the advantage of making it easy to roll back the system in case something goes wrong. For those reasons, as well as its minimalist footprint, it is well-suited for certain types of operations in the cloud and on embedded devices, where tight security and high availability are essential. There has been relatively little news from Canonical about Snappy Ubuntu Core until this week, when the company announced at the OpenStack Summit in Tokyo that several vendors will soon begin offering open network switches that run the OS. They include Quanta, Amega and Penguin Computing. Canonical is pitching the solutions as a way for users to obtain networking hardware that is not bound to particular software platforms. Ubuntu Snappy Core offers “a common, neutral operating system shared by multiple vendors, each of which focuses just on their particular network control system, delivered essentially as an application on the neutral OS,” Canonical said in a statement. “Ubuntu Core does not itself control the switch data plane; such network control is handled by vendor software packaged as a ‘snap.’ Customers select the network control snap they prefer, keeping a common underlying platform for management and security purposes.” The list of vendors that have endorsed Ubuntu Snappy Core for networking hardware is short, and it includes no huge industry names. Meanwhile, the network device marketplace is only a small slice of the territory Canonical eventually hopes to conquer with this OS. But this may be an important first step. This first ran at http://thevarguy.com/open-source-application-software-companies/102915/canonical-has-snappy-ubuntu-core-win-open-networkin (Comment on this)
9:06p	Cloud, SaaS Companies Continue to be Battered by DDoS Attacks in Q3 2015: VeriSign Report This article originally appeared at The WHIR DDoS attacks increased dramatically in Q3 2015, reaching their highest volume in two years, according to the latest quarterly security report from VeriSign. The number of attacks mitigated by Verisign grew by 53 percent, and the average DDoS attack size grew 27 percent to 7.03 Gbps, the Q3 2015 DDoS Trends Report said. The report explores the security of operating systems once thought to be more secure against malware vulnerabilities, like Linux, Mac OS X and iOS, in the wake of discoveries like Apple app vulnerability XcodeGhost, Linux botnet Ballpit, and mobile iOS malware YiSpecter. Almost 3 out of 5 attacks peaked at over 1 Gpbs, with one-third reaching 5 Gbps and 1 in 5 reaching 10 Gpbs. NTP, DNS, and SSDP UDP floods were the most common attacks, collectively accounting for almost two-thirds of all attacks in the quarter. For the fourth consecutive quarter the most commonly attacked industry was IT services/cloud/SaaS, in which 29 percent of companies were attacked, slightly more than the 26 percent of media and entertainment companies. Both sectors have also experienced attacks this year peaking at more than 80 Gbps. Interestingly, only 5 percent of ecommerce and online advertising were attacked in the quarter, considerably less than financial, public sector, and telecom companies, which ranged from 12-15 percent. Malware protection company Malwarebytes acquired Mac protection provider AdwareMedic in July in recognition of the spread of vulnerability across OSs. This first ran at http://www.thewhir.com/web-hosting-news/cloud-saas-companies-continue-to-be-battered-by-ddos-attacks-in-q3-2015-verisign-report (Comment on this)

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