Wednesday, October 12th, 2016

Time	Event
3:00p	Transition Now to an Agile Storage Infrastructure or Perish Shachar Fienblit is CTO at Kaminario. Today, competitive success depends on being able to quickly respond to changing market demands, economic and regulatory conditions. Every business process in the enterprise has to be done much faster than it was done in the past. This is a paradigm shift, since enterprise IT must respond and change directions fast to support critical initiatives. Unfortunately, most enterprise IT shops are far from being agile. In fact, quick response to changing conditions and requirements is not an enterprise IT characteristic. And that has to change. Enterprise IT has to be reshaped to become an agile asset to compete in today’s on-demand, competitive and information-driven global marketplace. For enterprise IT teams, storage solutions continue to be the most challenging area. Companies must accommodate the ever increasing amount of data that’s being generated. According to recent research, the industry creates 2.5 quintillion bytes of data every day. In fact, 90 percent of the data in the world today has been created in the last two years alone, while another study estimates data production will be 44 times greater in 2020 than it was in 2009. As a result, storage solutions today must support such data deluge, while providing high level of performance that users have come to expect – all in a scalable and cost-effective way. Whether driven by service level agreements (SLAs) or high customer expectations, storage systems must be resilient. At the same time, current trends in business applications require storage systems to be agile, flexible and respond to the ever changing demands, in a flash. So what type of storage infrastructure should companies select? Definitely one that delivers performance, resiliency and agility, while helping to maintain reduce storage-related operational and capital expenditure. Here are a few tips on designing an agile storage infrastructure: Consistent performance under a mix of unpredictable workloads: Enterprises are running on the same system mixture of online processing, analytics and virtual workloads. This is a new challenge as performance SLAs are not always met, and it is practically impossible to predict and plan the performance requirements with dynamic workloads changing on a daily basis. The use of flash technology in an all-flash storage array that is adaptive to mixed workloads is the only way to guarantee consistent performance. Ability to scale capacity and storage performance independently: To meet SLAs, customers tend to over provision storage compute and capacity. This can be a temporary solution, but it comes with a significant cost premium. A storage architecture that can scale-up and scale-out on-demand is the only architecture that allows customers to meet the storage and performance requirements, without overprovisioning unnecessary capacity or compute resources. Deliver predictable storage in an unpredictable business world: Since it is becoming impossible to predict infrastructure needs for the next two to three years, agile infrastructure provides maximum flexibility to adjust the storage infrastructure to future needs. For example, a software-as-a-service (SaaS) company needs a storage infrastructure that is highly agile so it can boost capacity and computing power to meet customer demands. This approach eliminates the need to buy specific array models with limited scalability as the infrastructure will not meet the new and unpredictable requirements in the future. Software-defined architecture for quick deployment of new hardware technologies: Hardware technology, specifically flash media, is improving at a very fast rate. The price of flash declines between 25 to 30 percent per year. As a result, it is crucial that organizations look to reap these benefits of technology upgrades. Modern software defined storage architectures should support storage expansion while utilizing new flash and controllers’ technologies and allow customers to mix and match legacy technologies with new technologies. This will enable customers to invest in storage infrastructure that is optimized for today’s needs and for future hardware improvements. Eliminate “future forklift” upgrades: The cycle of upgrading storage systems every three to five years with a forklift upgrade is becoming too risky, complex and resource draining. IT departments should focus on bringing business value from the data they store, and not spend time and effort on long, complex migration projects. A modern storage architecture should allow a company to add and/or decommission new or old hardware technology in a very simple way, without disrupting the IT infrastructure. The IT challenges faced by enterprise customers are driving them to change the way they architect data centers and storage infrastructure. Today’s business requirements bring a great opportunity for companies to transition into an agile storage architecture, that will not only meet today’s demands, but also support what’s next to come. Industry Perspectives is a content channel at Data Center Knowledge highlighting thought leadership in the data center arena. See our guidelines and submission process for information on participating. View previously published Industry Perspectives in our Knowledge Library. (Comment on this)
5:36p	US Data Center Construction Update: Week of October 12 CyrusOne Buys Land for Huge Phoenix Expansion CyrusOne, a Carrollton, Texas-based data center provider that grew up providing colocation services to the Texas oil and gas sector, has bought a 29-acre property next to its already enormous data center campus in Chandler, Arizona, just outside of Phoenix. The company expects data center construction on the new property to take place over the next several years, envisioning a campus with more than 2 million square feet of data center space, including both existing and future capacity. CyrusOne already refers to the existing campus as the largest data center campus in the country. Its two existing buildings are 180,000 square feet each. Facebook Breaks Ground in Los Lunas Officials at the Facebook data center groundbreakingin Los Lunas, New Mexico (Photo: Facebook) Facebook held a groundbreaking ceremony for its next mega-scale data center in the Village of Los Lunas, New Mexico. Data center construction at the site will be overseen by the general contractor Fortis Construction. The future data center will be powered by wind and solar energy sourced on Facebook’s behalf by PNM Resources, the company said in a statement. It will join existing Facebook data centers in Prineville, Oregon; Forest City, North Carolina; Altoona, Iowa; and Luleå, Sweden. The company is also building new data centers in Fort Worth, Texas; and Clonee, Ireland. New Mexico won the project after a period of competition with Utah, which Facebook was also considering. In the end, New Mexico officials managed to convince the social network to make the investment in their state by offering a better tax deal. CoreSite Brings Online Its Largest Silicon Valley Data Center Yet Rendering of CoreSite’s SV7 data center in Santa Clara, California (Image: CoreSite) CoreSite Realty Corp. announced the launch of its newest Silicon Valley data center. The 230,000-square foot SV7 facility is the data center provider’s largest in its seven-building San Francisco Bay Area portfolio. There’s a lot of demand for data center space in all top US data center markets, and Silicon Valley is one of the hottest among them. More than 60 percent of space in the new CoreSite facility has already been leased, the company said in a statement. SV7 is one of five buildings on its Santa Clara campus, which now totals about 620,000 square feet. CoreSite’s entire seven-building Bay Area portfolio now provides 780,000 square feet total. Vantage to Break Ground on Sixth Santa Clara Building Rendering of Vantage Data Centers’ future V6 data center in Santa Clara, California (Image: Vantage) Vantage Data Centers, whose private equity owners are reportedly mulling an exit, is planning a groundbreaking ceremony for the sixth building on its already massive Santa Clara data center campus Thursday. Santa Clara Mayor Lisa Gillmor is expected to be in attendance and a ceremonial demolition of the building that will be replaced with the future V6 data center is planned. The company is planning to kick off data center construction on its original Santa Clara campus as it is also making plans to start building out a whole new campus on a big piece of land it recently acquired about two miles away. French Cloud Provider OVH Building in Virginia French hosting and cloud services firm OVH is building out an existing facility in Virginia’s Fauquier County, which will be its first data center in the US. Investment firms KRR and TowerBrook recently acquired a minority stake in the company, injecting €250 million in capital to fund global expansion. Virginia officials, including Governor Terry McAuliffe and Secretary of Commerce and Trade Todd Haymore, lauded the company’s decision to make their state home to its first step into the US market. The company expects to invest $47 million in building out the data center and its North American headquarters, according to a statement issued by the governor’s office. McAuliffe has approved a $1.25 million grant to help Fauquier with the data center construction project. OVH will also be eligible for sales and use tax breaks on equipment, the statement read. Involta to Build in Pittsburgh Data center and managed services provider Involta announced data center construction plans in Armstrong County, Pennsylvania, which is in the Pittsburgh metropolitan area. Healthcare provider and insurer UPMC will be Involta’s anchor tenant in the future 40,000-square foot data center. Once the project is complete, Involta’s total investment in the Pittsburgh metro will total about $16 million, the company said in a statement. Including the future facility, the company’s portfolio will have a total of 14 data centers in secondary US markets. (Comment on this)
7:42p	Researchers Win Grant to Revolutionize Data Center SLAs Brought to You by The WHIR In order to satisfy customers by meeting service level objectives, data center operators are constantly forced to overprovision server resources, creating cost and inefficiency that puts extra pressure on the bottom line. Hao Che, an associate professor in the Computer Science and Engineering Department at the University of Texas at Arlington (UTA) has been awarded a grant valued at $799,950 over three years by the National Science Foundation to develop his model for guaranteed delivery of service-level objectives without that overprovisioning. Che’s project, which he is working on with Department Chair Hong Jiang and Professor Jeff Lei, is to create a model which allows customer service-level objectives to be mapped onto precise resource requirements at the individual server level. The abstraction will allow the model to be data center platform-agnostic and could lead not only to guaranteed service-level packages built to the specific needs of customers without overprovisioning, but also to helping cloud consumers purchase the resources best suited for their needs. Last year, researchers estimated that some $30 billion worth of servers, or 30 percent of those deployed worldwide sit “comatose,” which could indicate huge potential savings for data center providers. “This model can also benefit cloud customers,” Che, a former systems architect, said in a statement. “Today’s cloud service providers mainly provide resource-centric services to their customers, offering hardware and software resources only, leaving the hard question to the customer themselves to deal with. For example, how many resources are needed to meet the service-level objectives. With our model, the customers will be able to know exactly what and how much resources need to be purchased to meet their needs. This approach should provide important insights into computer systems and architecture designs with an eye toward performance guarantees, cost-effectiveness and better utilization of resources.” UTA has developed a strategic plan to emphasize data-driven discovery, and department faculty are working on several related projects. This first ran at http://www.thewhir.com/web-hosting-news/texas-researchers-receive-grant-for-project-that-helps-service-providers-meet-slas (Comment on this)
8:00p	ServerHub Announces New Amsterdam Location at HostingCon Europe Brought to You by The WHIR Hosting provider ServerHub is launching its seventh location by the end of the year, according to the company. The news came in conjunction with this week’s HostingCon Europe conference and trade show. Its new location and second location in Europe, Amsterdam, will be live in December. Amsterdam is a huge connectivity hub in Europe, making it an ideal location for hosting infrastructure. ServerHub recently launched its sixth location in New York, on the heels of other expansions in Frankfurt, and Seattle, respectively. “We’ve been very excited about the results we have had in our current markets in the European Union and based on our customer feedback we have received, expansion into Amsterdam had been a no-brainer,” John Brancela, ServerHub CEO tells The WHIR in an email. “There is unprecedented demand in the Netherlands and we are extremely happy to call it home to our 7th global location.” This fist ran at http://www.thewhir.com/web-hosting-news/serverhub-announces-new-amsterdam-location-at-hostingcon-europe (Comment on this)
8:20p	Facebook and Google to Build Transpacific Submarine Cable Facebook has partnered with Google to pay for construction of what will be one of the highest-capacity submarine cable systems stretching across the Pacific Ocean, connecting Los Angeles to Hong Kong. This is a second such partnership Facebook has gotten involved in and yet another example of changes happening in the submarine cable industry, which has traditionally been dominated by consortia of private and government-owned carriers. Operators of mega-scale data centers who deliver internet services to people around the world – companies like Facebook, Google, Microsoft, and Amazon – have reached a point where their global bandwidth needs are so high, it makes more sense for them to fund cable construction projects directly than to buy capacity from carriers. In May, Facebook announced it had teamed up with Microsoft on a submarine cable across the Atlantic, linking landing stations in Virginia Beach, Virginia, and Bilbao, Spain. The future transatlantic system, called MAREA, will be operated by Telefonica. Both Europe and Asia Pacific are important markets for the internet and cloud services giants. The Los Angeles-Hong Kong cable will help improve connectivity between both companies’ data centers in the US and Asia. Map courtesy of Facebook The cable will be called Pacific Light Cable Network, taking its name from the third partner on the project: Pacific Light Data Communications. See also: Transpacific Data Center Connectivity Hub Launches in Seattle Both MAREA and PLCN systems will be built by TE SubCom, one of the biggest names in the submarine cable industry. In addition to simply increasing the amount of bandwidth between the US and Asia, the 120Tbps PLCN system will provide greater diversity in transpacific cable routes, Najam Ahmad, director of technical operations at Facebook, wrote in a blog post announcing the project. “Most Pacific subsea cables go from the United States to Japan, and this new direct route will give us more diversity and resiliency in the Pacific,” he explained. The FASTER cable system, backed by Google and several Asian telecommunications and IT services companies, came online earlier this year. Another big submarine cable project is the New Cross Pacific Cable System, which is backed by Microsoft and a group of Asian telcos. NCP is expected to come online in 2017. Both will land in Oregon on the US side. Also this year, Amazon Web Services made its first investment in a submarine cable project, agreeing to become the fourth anchor customer necessary to make the planned Hawaiki Submarine Cable between the US, Australia, and New Zealand possible. One big way in which PLCN and MAREA will be different from traditional transoceanic cable systems is they will be interoperable with a variety of network equipment, rather than being designed to work with a specific set of landing-station technologies, according to Ahmad. Not only will each user be able to choose what optical equipment fits their needs best, they will be able to upgrade that equipment as better technology becomes available. “This means equipment refreshes can occur as optical technology improves, including taking advantage of advances made during the construction of the system,” he wrote. “When equipment can be replaced by better technology at a quicker pace, costs should go down and bandwidth rates should increase more quickly.” See also: Data Center Connectivity: Dare to Bypass New York (Comment on this)
8:33p	KKR Said to Write Off First Brazil Deal Amid Aceco Legal Battles (Bloomberg) — On May 11, 2015, Jorge Fergie opened an e-mail from an anonymous sender. Aceco TI, the Brazilian company whose board he led as chairman, had been cooking the books and bribing government officials for years, the sender alleged. DCK: Aceco is a major data center design, construction, and maintenance player in the Latin American market. For Fergie, the head of Latin America for private equity giant KKR & Co., it was a stunning claim. KKR had closed a $700 million acquisition, including debt, of the data center company just 11 months earlier. The deal was KKR’s first in Brazil, announced as an “ important milestone” for a firm that helped create the private equity industry in 1976. KKR now has written down its $475 million investment in Aceco to zero, people with knowledge of the matter said. Today, the fate of Sao Paulo-based Aceco hangs in the balance of a legal battle between KKR, led by billionaire founders Henry Kravis and George Roberts, and the company’s part-owner and former chief executive officer, Jorge Nitzan. A judge in Sao Paulo is reviewing evidence from both sides and will determine whether KKR can recover damages, and if so how much. In recent weeks, Nitzan entered Aceco’s headquarters in an attempt to take back control from the current management, said the people, who asked not to be named discussing private details. Earlier this year, an entity controlled by him bought most of Aceco’s debt from Banco Bradesco SA in an effort to increase his ownership in the company, the people said. “Mr. Nitzan now is trying to save Aceco and its parent,” an acquisition vehicle created for the 2014 transaction, “from almost certain bankruptcy and to restore Aceco’s prior position in its industry, in part to avoid the wholesale termination of hundreds of loyal employees,” Maria Cristina Cescon, a lawyer for Nitzan, wrote in an e-mailed statement. “KKR bought control of Aceco just before the catastrophic meltdown of the Brazilian economy and government (Aceco’s primary customer) and the significant depreciation in Brazilian currency,” Cescon wrote. “Its timing could not have been worse and was exacerbated by its post-acquisition mismanagement. Now KKR is trying to undo the deal and blame others for its mistimed acquisition.” In addition to fighting Nitzan, KKR is in legal arbitrations with other entities from which it bought the company. That list includes New York-based private equity firm General Atlantic and Debora Staley, who is Nitzan’s sister and the wife of Barclays Plc CEO Jes Staley, the people said. Representatives for General Atlantic and Aceco said they couldn’t comment while arbitration is under way. Telephone messages for Debora Staley weren’t returned. “We believe we were defrauded by the sellers of Aceco and are seeking to recover losses related to fraud and corruption by former management of the company,” KKR said in an e-mailed statement. “The entirety of this matter has been brought before the proper authorities in Brazil, and we respect their process.” Rethinking Investments KKR’s misadventure in Brazil comes as several global private equity firms rethink investments in the country, which has been embattled by economic recession and political crisis. One example is TPG, founded by billionaires Jim Coulter and David Bonderman. The firm plans to pare staff and may close its Sao Paulo office amid a lack of palatable deals, people with knowledge of the moves said in August. Carlyle Group LP, led by a trio of U.S. billionaires, has had to inject money, including from its partners’ pockets, into Urbplan Desenvolvimento Urbano SA. The Brazilian real estate developer has fought hundreds of lawsuits alleging it failed to complete home sites across the country. “It’s in meltdown essentially,” Tony James, the president of Blackstone Group LP, the world’s biggest private equity firm, said of Brazil in November 2015. Bloomberg last week viewed the results of an investigation conducted by KPMG LLP for Aceco’s board, in a report dated March 3. The document featured a timeline of events that included the date and nature of the first whistle-blower’s message to KKR’s Fergie. A second whistle-blower came forward in November 2015, according to the report. Aceco, which builds and maintains data centers in Brazil and nine other Latin American countries, made more than 57 million reais ($16 million) in improper payments from 2012 to 2014, including to “sham entities” tied to government officials whose departments awarded business to the company, the KPMG investigation found. World Cup Revenue In addition to the payments, the KPMG report alleges that Aceco recorded improper revenue by allocating many of the charges to existing work, including its assignments for the 2014 FIFA World Cup. It is also alleged to have inflated margins on at least two major projects, mis-allocated cost overruns from over-budget projects to under-budget assignments, and accelerated revenue without justification. Those alleged activities resulted in inappropriate recording of at least 37 million reais in 2013 revenue and at least 102 million reais in 2014, the investigation found. Aceco, which has about 750 employees, reported net revenue of 682 million reais in 2014. “The magnitude of the misconduct, the manner in which the misconduct was carried out, the fact that senior management was directly involved in the misconduct, including tracking its financial impact, and the fact that the misconduct occurred in connection with Aceco’s largest and most prominent projects reflects that this misconduct was systemic,” the report said. A representative for KPMG said the audit, tax and advisory firm couldn’t comment on specific findings due to client confidentiality. “We performed the services for our client in a professional manner and stand behind our work,” the firm said in an e-mail. The representative for Aceco and Cescon, Nitzan’s lawyer, didn’t comment on KPMG’s findings. Deloitte Touche Tohmatsu Ltd., which audited Aceco’s financials, withdrew its support of validity for the company’s 2013 and 2014 reported results, according to an Aug. 25 notice on Aceco’s website. A representative for Deloitte said via e-mail she couldn’t comment because of client confidentiality. After a whistle-blower approached the police, Brazilian law enforcement also opened an investigation into the allegations at Aceco, according to a public record of the case in Sao Paulo. As arbitration continues between KKR, Nitzan and other entities, dealmaking in Brazil is mounting a revival. Inbound transactions, in which foreign companies bought Brazilian assets, almost quadrupled to $11.1 billion in the third quarter from a year earlier, according to data compiled by Bloomberg. That’s the best showing since the final three months of 2013. In a July survey by the Latin American Private Equity & Venture Capital Association and Cambridge Associates, 59 percent of private equity fund investors outside of Latin America planned to increase their bets on Brazil through funds dedicated to the country. For Latin America-based investors, the figure was 23 percent. (Comment on this)

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