Photographer: Simon Dawson/Bloomberg

Pulling the Plug on Comatose Servers

A data center company tries to work more like Amazon’s cloud.

Just as office tenants pay for square footage based on how many workers they expect to employ, the $200 billion data center industry charges customers based on how much space their servers occupy and how much power they plan to use. Data center customers, however, tend to overestimate, asking and paying for more servers than they need. They then wind up with so-called comatose servers that may sit idle for months. Some 30 percent of the world’s servers are going unused at any given moment, wasting about $30 billion a year, according to a June estimate by Stanford and Anthesis Consulting Group.

By contrast, the public clouds of and Google give customers the flexibility to pay as they go, rather than committing to a certain use of processing power upfront. A new $300 million, 100,000-square-foot data center in Plano, Texas, is the first to take a cue from the public clouds by similarly letting tenants pay for computing power based on actual use. The center’s owner, Aligned Energy, says it should be able to save customers 30 percent to 50 percent a year in data center costs.

To help accommodate the discounts, Chief Executive Officer Jakob Carnemark says Aligned has adapted hardware and developed software that will keep its facilities running more efficiently—and take note of any servers going unused. Only 1 in 5 data center servers are being fully used at any time, he says. “Given that massive level of waste, there’s a real opportunity for us.”

Aligned has borrowed materials developed for mobile devices to improve its cooling systems. An aluminum heat sink, modeled on the diffusion technology found in smartphones, helps drastically reduce the servers’ need for air conditioning and especially water, the company says. Most large data centers use about 1 million gallons of water a day, but Carnemark says his can get by on as little as 150,000 gallons even while packing in servers more tightly than rivals do.

Software made by Aligned actively monitors the cooling systems, making it easier to respond to alarms or track how much power a client's equipment is using. Last year, Lenovo bought copies of the software to help retrofit its data centers in Santa Clara, Calif., and Morrisville, N.C. Lenovo technical project manager Erin Bolduc says the move has saved the plants 60 percent to 80 percent in power costs because of increased energy efficiency. “The monitoring system knows if there is an idle server or rack, so we don’t cool more than we have to,” she says. And without the air conditioning on full blast at all times, “people are comfortable and don’t have to wear winter jackets.”

Carnemark, who’s worked in data centers for 25 years, founded Aligned in Danbury, Conn., in 2013 with veterans of the software and cooling businesses and undisclosed venture funding from BlueMountain Capital Management. “We saw a need in the marketplace to create a more elastic model,” he says. “Again and again, we saw clients would have to overprovision.” The Plano data center went online in November. Carnemark says it will take more than two years for the 120-employee company to turn a profit.

Aligned’s more efficient model should appeal to boutique software or health-care companies that don’t need dozens of data centers, says Rick Villars, vice president for data center and cloud research at researcher IDC. But even with all of the added efficiencies, Villars says, it may be tough for Aligned to consistently underbid cloud storage companies or, conversely, woo IT heads leery of moving their data somewhere new. Data centers will have to become more standardized, he says, before clients can “truly take advantage of these energy efficiencies.”

Carnemark says he’s not concerned about finding a place in the market, given the growing needs for computing power. The data center industry—companies that house client data on discrete servers, unlike the cloud—can accommodate less than a third of the world’s storage needs, and by 2020 it will be less than 15 percent, estimates equipment maker EMC. For now, Carnemark says, he’s focused on opening a second pay-as-you-go data center, in Phoenix later this year, followed by more in California, Illinois, New Jersey, and Virginia. “Data centers are the fastest-growing users of power and water,” he says. “That’s unsustainable.”

The bottom line: At its $300 million facility in Texas, Aligned Energy is pitching metered use as a better model for the data center industry.

(Updated fourth paragraph to clarify use of analytics software)

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