Dutch data centre sector optimistic about growth prospects

Author: Maarten van Vliet

The data centre sector has become part of the economic and social backbone of the Netherlands. The sector and political world have designated data centres the country's third 'main port', alongside the Rotterdam port and Amsterdam airport Schiphol. In a European context, the Netherlands is outperforming when it comes to data centre infrastructure, and further growth is expected in the coming years.

The Netherlands' leading position is due to a number of factors, including high-quality ICT expertise
and infrastructure and the presence of the largest internet exchange in the world, AMS-IX. The geographic position of the country and stable political situation, as well as a relatively favourable tax and investment climate for foreign companies are other supporting factors. Major players such as Microsoft and Google have data centres in the Netherlands; the latter has pledged to invest EUR 600 million in its site in the north of the country.

According to the Dutch Datacenter Association (DDA), the Netherlands serves as a digital gateway to Europe. Amsterdam ranks alongside London, Paris and Frankfurt in the top four data centre locations in Europe, the industry group says. The activities are concentrated in North Holland around Amsterdam, with almost 160,000 m2 of data centre space. South Holland, North Brabant and Groningen are also key locations. In total, the Netherlands counts more than 200 data centres with cumulative space of around 259,000 m2. Around 56,000 server racks are in use, out of a total capacity of 115,000. The large players have 70-90 percent of their capacity leased, while smaller players are closer to 25-50 percent.

The role of the DDA
The DDA was formed a year ago to support the sector and now counts 28 members, including KPN, The Datacenter Group, Interxion, Colt, Interoute, Eurofiber and Evoswitch. The DDA is also a member of the Stichting Digitale Infrastructuur Nederland (Netherlands Digital Infrastructure Foundation) and the European Data Centre Association (EUDCA). The DDA's managing director is Stijn Grove, who also holds the same position at the EUDCA.

Grove said businesses face the challenge of continued professionalisation of their IT and ever greater continuity, combined with the pressure for further cost efficiencies. Data centres, as a platform for extensive connectivity, flexibility and economies of scale, offer the solution. Hybrid IT infrastructures in professional data centres offer the advantage of flexibility, with secure connections to a wide range of cloud providers. Data centres also play an increasingly important role in realising IT security. The security offered by data centres thanks to direct physical connections to other in- data centre service providers and safe connection points with providers in other data centres is essential.

Data centes also allow users to make a smart distinction between critical and less critical IT, said Grove. This can mean hybrid forms, such as an organisation's own IT environment in combination with one or more external cloud service providers. The ideal mix can be developed, while still keeping costs under control and ensuring 100 percent availability. The latter is increasingly difficult to achieve with in-house data centres. The further adoption of the 'as a service' way of working, the software-defined IT platforms that make this possible and less hardware restrictions - these factors are all increasing demand for platforms where this is possible, at data centres.

Grove said he expects demand for this type of flexibility and additional services to grow in 2016 and drive increased professionalisation in how data centres are run. In addition to technical aspects, processes and monitoring are important. The quickly growing DDA will focus on promoting and facilitating this with a range of activities in 2016. It's working both with international players, through the Digital Gateway to Europe campaign, as well as with national and regional players essential to the IT systems of local businesses.

Sustainability is key
As data centres increasingly carry the image of large consumers of energy, 'greening' of the sector is essential. Improving energy efficiency is also of strategic importance, at the national and international levels. The Dutch data centres have an average Power Usage Effectiveness (PUE) of 1.31, well under the international average of 1.8. Around 80 percent of those questioned used entirely 'green' energy, from sustainable sources. Over half (55%) the energy used in an average data centre is electricity to run the IT equipment, while around 35 percent goes to cooling systems.

Despite the growing data traffic, the energy use of the collective ICT sector in the Netherlands was largely stable in 2014, according to the latest figures from the MJA3 ICT Sector report by the state business services agency RVO (Rijksdienst voor Ondernemend Nederland).

The RVO expects double-digit annual growth in data traffic and data storage due to the growing use of the cloud. The sector is also growing due to the outsourcing of ICT from customer premises to dedicated data centres. According to the RVO, this is leading to higher utilisation of telecom networks and expansion of data centres. Despite this, energy use only increased 0.7 percent in 2014. The RVO's figures are based on work with companies such as KPN, Vodafone, BT Nederland, Microsoft, Equinix, Interxion, Eurofiber and Dell.

Operators moving quickly
The sector is moving quickly to reduce the impact of its IT infrastructure on the environment. KPN opened its tenth data centre this past summer, at the High Tech Campus in Eindhoven, and it received the Tier IV certification, making it the most sustainable facility in its class. For this, KPN received the ICT Milieu Award 2015, from industry group ICTNederland. All of KPN's electricity is from sustainable sources in the Netherlands.

A few months later, in October, KPN started using 2,000 m2 in the Almere Data Centre 2 run by Keppel T&T. This brings the data centre to a total 8,000 m2, the largest run by the provider. This centre has a Tier III certification and the potential for expansion to 13,000 m2.


Source: Dutch Datacenter Association

Vodafone claimed at the end of last year to be the first Dutch telecom provider with a neutral CO2 footprint. Its network, shops, offices and internal systems and processes no longer contribute to climate change. Vodafone uses techniques such as hardware virtualisation in data centres and cooling equipment with outdoor air. It also uses 'smart' ICT, such as smart meters for monitoring electricity usage and shutting down part of its mobile network at night.

All Vodafone's data centres in the Netherlands run on wind energy. In addition, all the equipment in the data centres in recycled or re-used. Vodafone runs a total ten data centres in the Netherlands, but is working on consolidating the sites to just three, large network exchange points that will serve as each other's back-up. One of these 'super switches' is already in use in Eindhoven.

T-Mobile has five data centres running entirely on sustainable energy, mainly from wind. The data centres account for around 10 percent of the company's total energy usage. Its average Energy Usage Effectiveness is less than 1.4, the company claims. T-Mobile said it was the first Dutch telecom provider to receive the ISO 14001 certification, meaning it has an environmental care system and manages environmental risks, under the main goal of energy management.

The DDA's Grove said he expects the trend of investing in energy efficiency to continue in 2016. New equipment will reduce energy usage while also increasing processing power. Addressing the entire value chain will be important to achieving the next steps, he said.