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From Site Selection magazine, January 2010

Server Security

Next Generation Data has opened one of Europe’s largest data centers in Newport, Wales.

 facility built in Newport, Wales, in the late 1990s to house a major semiconductor manufacturing operation is finally getting an occupant. Next Generation Data has invested US$360 million to refit an 800,000-sq.-ft. (75,000-sq.-m.) facility that was built for LG Electronics in 1997, but was never occupied. Now, NGD is turning the massive complex, known as NGD Europe, into one of Europe's largest data centers.

The facility lies on the M4 corridor, about a two-hour drive west of London. It has its own substation with a direct connection to the U.K.'s National Grid and capacity of up to 19,000 server racks, offering the capability to support large multinational tenants. The identity of most tenants will be kept confidential, but U.K. telecom giant BT announced in December that it is taking 380 racks, which will be available for customer use in February.

The massive project is a coming home of sorts for chairman and co-founder Simon Taylor, a native of nearby Brecon. Taylor says the facility, which LG abandoned after the Korean Stock Market collapsed in 1997, is one of the best manufacturing buildings in the U.K.

"We wanted to be outside the major cities to reduce our commercial risk because that's where we saw the market going," Taylor says. "The first place I went looking was Wales, and I was looking for a site with abundant power."

Taylor and his partner Nick Razey founded NGD in 2007. Both have extensive experience in the telecom industry. He says the building, designed for semiconductor production, translates very well to being a secure data center. Renovations will change it into 25 spaces ranging from 5,000 to 25,000 sq. ft. (465 to 2,323 sq. m.).

Taylor says the Tier 3 data center offers the ultimate in sophisticated security systems, has triple-skinned walls and bomb-proof glass and is earthquake proof. It is also patrolled by a team of former special forces security guards.

"The Welsh government gave us the surrounding grounds, and we've been able to turn it into an absolute fortress including prison-grade fencing," Taylor says.

Plentiful power at a reasonable cost is a major selling point for the facility. Another is its green aspect, Taylor says.

"We decided to buy all our power as green power. Because we are buying so much from the National Grid, we are able to buy at good prices, the same as our competitors pay for traditional power. Green is very important to us. The power company in the U.K. put a substation on this site for LG's purpose and we have now taken over that substation," Taylor says. "We believe there is no one else [among data center operators] in Europe with such power. All of our competitors around London will be running out of power with the [2012] Olympics coming. Any power left in London will go in the direction of the Olympics."

Most of NGD's clients will not be announced publicly, but Taylor says NGD has signed a second major global company and has a pipeline of potential data center customers, including some large U.S.-based companies.

"In the U.K., a lot of data center operators are property people who turn their property into a data center," Taylor says. "We are much more technologists."

NGD has plans for at least two more data centers. Taylor says his company is looking at a site in the south of France and is currently doing its due diligence on a site in Virginia.

GenShare Chooses Chile

Arun Subramony, general manager of GenShare, speaks during ceremonies announcing the selection of Chile for its global headquarters. To his right is Michelle Bachelet, president of Chile.

enShare, a joint venture between UST Global and GE to provide IT services, has selected Chile for its new global headquarters and IT services delivery center. The $30-million facility is located in Chile's central coastal region of Valparaíso, in the city of Viña del Mar. UST and its partners evaluated seven Latin American countries before selecting Chile because of its talent pool and business environment. GenShare plans to reach 1,000 employees in Chile by 2015.

"As we explored Latin American locations, Chile's highly educated work force, unparalleled business environment, advanced communications infrastructure and low operational cost made it a natural choice for a nearshore IT services delivery center for North America," said Arun Subramony, Genshare's general manager. "Beyond that, however, we view Chile as the best gateway to Latin America and servicing other regions of the world. We are here because we believe Chile is poised to become a leading location for high-value offshored services."

China Loves LCDs

Sharp, which is building an LCD panel facility in Nanjing, already has an LCD assembly facility in the city (pictured).

eclining prices of LCD TVs have Chinese consumers flocking to electronic stores. As a result, rival LCD suppliers based in Japan and South Korea are rushing to China to establish manufacturing beachheads. Within a period of a few weeks in late summer 2009, Sharp, Samsung and LG Display announced major manufacturing projects in China.

"LCD TV sales in China have been really strong since 2008," says Sweta Dash, an LCD industry analyst for iSupply, an El Segundo, Calif., consultancy specializing in the electronics sector. "By 2011, the China market will be as large as the U.S. market, actually bigger."

Dash says the price of LCD panels has dropped 50 percent since 2008. She says sales of LCD TVs were expected to reach 24 million by the end of 2009.

"At the beginning of 2009, the Chinese government began a rural stimulus program offering consumer rebates as an incentive for consumers to start buying LCD TVs. It initially began in a few provinces and then it included the major cities. It worked well and the Chinese domestic brands, which were also offering aggressive prices, gained a lot of market share."

Sharp Electronics signed an agreement with CEC Panda LCD Technology for an LCD production project in Nanjing. Responding to questions submitted by Site Selection, a Sharp spokesperson offered the following comments:

"This 6th generation LCD panel production project is the first for CEC Panda and Nanjing-city. Thankfully the Chinese counterparts highly evaluated Sharp's LCD technology, which led to this official agreement for the production of LCD panels using 6th generation glass substrates. Sharp already has a plant in Nanjing-city for assembly of LCD TVs, and in 2010, we are planning to establish an 'LCD R&D center' in Nanjing-city as well. By producing LCD panels in Nanjing-city, Sharp will be able to realize an overall system of R&D, production, and assembly of LCD panels and modules to LCD TVs there."

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