The War of the Currents

Posted by Bob Landstrom: CISSP, CGEIT

This week I was in New York City attending a meeting with the Executive Communication Group. One night I decided to go for a walk, and as I was walking I reflected upon the fact that right there, in the streets of Manhattan where I walked, there was once a decisive battle fought in “The War of the Currents.” Let me share this story with you:

In the late 19th century, the US government was deliberating on whether to use AC or DC power for residential and industrial service.  There were two prominent personalities at opposite sides of this debate, thus establishing the battle lines- Thomas Edison and George Westinghouse.

Jim Cramer? C’mon Man!

Well, now I know why I’ve never come out on top whenever I buy one of Jim Cramer’s recomendations.

In a recent (10/22/2009) Mad Money piece on CNBC, Jim Cramer used the Equinix acquisition of Switch and Data to make the point that data centers are obsolete.  In his diatribe about why anyone with Equinix stock should immediately sell, he made the following nearly unbelievable points.

First, he blamed the strong buy and hold recommendation of industry analysts on the fact that these analysts are experts in their field.¬† His logic rests on the position that because these are data center industry analysts, they’re unaware of broader technology issues.¬† That’s right.¬† He’s blaming data center industry analysts for having expertise in their field of knowledge.¬† If you grant some credit to Cramer that maybe he is in fact an expert of his own (which before today I sort of did the same), you’ll perhaps think differently after the following.

Where should we build that data center?

When launching a new data center build project, where the data center will be located is a fundamental issue. There are many factors in deciding where the data center will be, but all of these factors can arguably be consolidated into two issues- Risk and Cost.

We mention risk in terms of Risk Management. Even if a data center is not specifically a disaster recovery site, many issues involving the physical location of the data center are evaluated to assess risk to availability of the equipment and data that would reside there. For example, exposure to environmental threats such as flooding, storms, earthquakes, and so on is often evaluated. Man-made environmental threats such as proximity to chemical plants, railways, gas lines, and so on are included here too. Risk management evaluations will also consider factors such as local crime rate, political stability, and threats from war or terrorism. For a security and risk management professional, this list is long, but any risk exposure is also prioritized and weighted for pragmatic consideration when evaluating site selection for a data center.