A tour of Iceland's data centers

Data centers provide the backbone for many tech services we take for granted, but what goes on behind those doors -- and why might firms including Apple and Google be interested in moving over?
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What are data centers?

Before we explore the lure of Iceland's shores in the data centre realm, we first must ask a simple question: What is a data center?

Often, we forget that many of today's modern business and mobile services require vast amounts of computing power away from our PCs and devices to run. The enterprise uses consumer data to predict customer trends and modify business plans as a result, retailers save and store customer details, and our social networks rely on supercomputing to keep going. 

However, in bare bones fashion, a data center is simply a dedicated space for companies to keep IT infrastructure and equipment, and this varies from a simple caged server to heavy-duty supercomputers which require vast amounts of electricity and continual cooling.

Disclaimer: The trip was sponsored by Landsvirkjun, the National power company of Iceland. 

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What do data centers do?

In short, data centers act as the brain of a company, and often as the backbone of IT infrastructure. The equipment stored in data centers vary from single systems and storage to powerful supercomputers which can analyze vast amounts of data stored within. Data center equipment can be used by the enterprise, Bitcoin miners, mobile payment providers, or automakers like BMW to run car simulations, to name but a few. 

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Iceland's Verne Global Data Center

Today's case study in question is Iceland's Verne Global Data Center. Located on a 44-acre former NATO site, the data center runs in a modular fashion -- the building extended as business grows. Computing equipment is kept in buildings that are reinforced with steel frames.  

According to Open Systems CEO Gunnar Gudjonsson, a number of companies -- including Facebook, Apple and Google -- looked at Iceland to establish data centers in the early days, due to the low cost of electricity, renewable energy use and location in relation to the US and Europe. However, things were not to be -- at least back then.

"They [large blue chip companies] clocked on to Iceland in the early stages when Iceland was not equipped to really go deep into discussion with those vendors," Gudjonsson told ZDNet. "Facebook, the others, they've all been here, they've all looked at it, and I know there's an open project where Apple is looking at Iceland."

According to the executive, discussions are ongoing, and Gudjonsson would be "very surprised" if a large vendor doesn't utilize Icelandic data centers in the near future. Gudjonsson says that Apple, for example, is "looking at the infrastructure today, the housing, the legislation, government support and so on" before making a decision. 




4 of 10 Charlie Osborne | ZDNet

What matters in setting up a data center? Location, location, location

If companies such as Apple, Google and Facebook are considering this large country -- with only 320,000 residents and where a company is considered big if it accounts for several hundred employees -- what is the appeal? To begin with, location. Strategically, Iceland can make business sense, due to its location between the United States and Europe.

In addition, land is plentiful and cheap, there are foreign investment tax breaks and incentives, and following the banking crisis six years ago where the country's financial system collapsed, the situation has stabilized. 



5 of 10 Charlie Osborne | ZDNet

Energy use and expense

Land is one thing -- the ongoing costs of running supercomputers and servers are another. Iceland is in a unique position due to one major advantage: renewable energy. 99.9 percent of the country's energy is generated from renewable resources -- including geothermal plants, hydroelectric plants and wind farms -- and the only energy import is fossil fuel for transport. 

Landsvirkjun, the National power company of Iceland, provides 75 percent of Icelandic energy through these means, and offers foreign investors long-term contracts to bring down the cost for foreign companies to set up shop in the country. Electricity is therefore cheaper than in Europe -- and a number of companies are taking advantage of it.  


6 of 10 Charlie Osborne | ZDNet

Heating and cooling

Another factor which brings down the cost of running data centers in Iceland is the year-round temperature. The country experiences temperature of between -2c and 14c all year, with few sudden spikes or declines. This, in turn, means that data centers in the country have no need for extensive mechanical cooling equipment, and largely rely on direct free air.

High-spec and powerful computing equipment require cooling frequently. If the equipment is not kept at a reasonable temperature, processing efficiency can decrease -- and in some cases, components may fail. To keep things cool, equipment and servers are stored in racks, while cool air is send up through holes in the floor, pulled through aisles before being pushed upwards through air vents. 

Fans clustered in threes are part of the process. If one fails, two others work harder. If two fail, neighboring fan clusters pick up the slack. 

Another advantage of not having to employ mechanical cooling -- aside from the expense -- is that fewer staff are needed, which heightens security. 

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When you've been entrusted with company and government computing equipment and data, getting things wrong can be disastrous for data center managers. To prevent security breaches, Verne Global employs nine "challenge" points, including truck traps, cameras which cover every blind spot, bullet-proof glass in the lobby and "man traps" -- a system where only one door can be opened with a keycard at a time. In addition, according to Jim Hathaway of Verne Global, security key cards only work with two PIN numbers -- one which is emblazoned on the card, and the other which exists only in memory. Finally, surveillance footage is kept for at least one year. 

Companies hiring the facility sometimes use screens to protect equipment from prying eyes, install face cameras, and every shelf is individually locked. 


8 of 10 Charlie Osborne | ZDNet


To prevent equipment degradation, anti-static flooring is used, specialized curtains and sensors clean and monitor air coming into the facility, and sticky mats pull dirt off shoes before you enter equipment areas.

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Backups and the spectre of computing failures

However, all of this means nothing if the power goes out. As a result, many data centers have backup plans in place to manage power shortages -- which not only can damage equipment, but cause chaos for the enterprise. In Verne Global's case, if power lines are cut, geothermal and hydroelectric secondary power sources take over. One of these is always redundant -- in other words, the whole data center can run on one source alone. If both of these are not available, batteries keep equipment running for a few seconds before diesel-powered generators kick in. The site has two days' worth of diesel on standby. 


10 of 10 Charlie Osborne | ZDNet

Low natural disaster risk

Finally, one thing which may put off businesses is the idea of volcanic eruption. However, as noted by Invest in Iceland's Director of Foreign Investment Thordur Hilmarsson, the population has been settled for 1100 years and over 200 eruptions have occurred since this time -- but majorly populated areas are outside of active volcano areas. Hilmarsson said:

"Despite the fact we have very active volcanoes and earthquakes, they are very limited in size, and we score very highly when it comes to low natural disaster risk. We don't have floods, hurricanes, flash floods or tornados."

Read on: In the world of innovation

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