The data center industry will continue to grow this year and in 2013 as more companies,including insurers, acquire buildings specifically to store data associated with emails, risk analysis, payroll, human resources, customer information, internal accounting and more, according to a recent study.

“A high percentage of companies are looking to expand their data storage capabilities because there’s more and more of it. You have to be able to store it someplace,” Digital Realty’s Investor Relations Vice President Pamela Matthews Garibaldi told Insurance Networking News.
 
About 92 percent of respondents, including 13 percent that were financial services companies, will definitely or probably expand in 2012, the highest percentage in six years, according to the Digital Realty-sponsored survey.
 
“In the data storage and maintenance world, there’s new software that helps insurance companies manage their data. New innovations have emerged that allow for remote management so that these companies don’t need to store data on site,” Pamela Garibaldi told Insurance Networking News.
 
An estimated 70 percent of respondents have built or acquired a data center project in the last two years and of those respondents with definite plans to expand in 2012, 38 percent expect to expand in three or more locations.
 
“A lot of these new applications are driving operating efficiencies and cost savings. Insurers and other companies consolidate all operations into one facility or five facilities or even outsource their entire IT departments to service providers that will manage data storage for them,” said Garibaldi.
 
In addition to multiple buildings, expansion trends cited in the report include remote management, outsourcing, containerized modules and partnering.
 
A full 78 percent say they intend to use a partner, such as a wholesale data center provider, for one or all of their projects because it can be more expensive for an insurance company to locate buildings with cooling systems and utility services that can accommodate servers rather than allowing a partner to do the site selection process.
 
“We acquire data centers and have an inventory of buildings that can operate as data centers. Weknow of vacancies and buy these buildings for development. We also negotiate a discount with utility companies that we pass on to our partners. We do all the footwork so that insurers can focus on their business,” said Garibaldi.
 
About 41 percent of those surveyed reported plans to use containerized modules as part of their expansion. A new technology, containerized modules look like shipping containers with pre-installed and packaged servers. “These modules require a building or power source for cooling and electricity to plug into. It’s a packaged product that developed out of the increasing demand for data storage,” said Garibaldi.

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