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Rebooting the New York-New Jersey Data Center Market

As existing markets grow and new markets emerge, the importance of private-public partnerships has never been more important for facilitating the continued growth and expansion of the cornerstones of our digital world – data centers. As personal and business consumption of cloud services continues to increase, the need for data centers in markets of all sizes is a forgone conclusion. The question then becomes how best to create the right conditions to foster this growth.

When data center operators are exploring their choices for expansion, they naturally gravitate towards locations with abundant power, fiber and attractive economics. Unfortunately the New York-New Jersey metro market is close to the bottom of the list when it comes to attractive power rates and tax incentives for large scale data center development. While technical innovation and feature sets figure heavily into the selection of a cloud platform, businesses are also heavily scrutinizing costs. If a provider’s underlying data center costs increase, so does the cost of the service they are providing to the consumer.

While the New York-New Jersey metro area enjoys access to one of the most robust telecommunications infrastructures in the world, a highly skilled technology workforce and two of the top three largest stock exchanges in the world, electricity rates and taxes make building on a large scale here cost prohibitive. Despite being the largest metropolitan area in the country in terms of population, and the home to some of the largest financial services companies in the world, the Cloud remains elusive in New Jersey. To say the New York-New Jersey data center market has been cold for the last few years would be an understatement. The good news is that the hardest parts of the equation to foster data center growth are already here – reliable infrastructure. The question that remains is what types of partnerships do the public and private sectors need to build in order to help pass legislation that will remove the financial obstacles facing large scale data center projects?

Learn more about how the New York-New Jersey metropolitan area can learn from Virginia’s success from a public/private partnership perspective at CapRate Data Center Summit on April 19th in New York. Rick Drescher will be moderating the panel discussion 'Best Practices for Public-Private Sector Industry Collaboration: Analysis of Northern Virginia's Growth Pattern'. The panel will include industry experts from utility companies, service providers and end users to discuss the value that public-private partnerships bring to data center operators, municipalities and ultimately to consumers. The panel will also cover the current conditions being faced by large cloud operators in the NY-NJ market, specifically how public and private sector leaders can join forces to reclaim their status as a top global data center market by addressing electricity rates, tax incentives and permitting and construction fast tracking programs to foster expansion of the Cloud into the region. In addition, Rick and the Critical Facilities Group will be on site for a series of one-on-one discussions about deploying data center, cloud and connectivity best practices.

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