Defying Data Gravity in Chicago
John Bonetti, Senior, Asset Manager
September 19, 2022
Chicago is the heart of the Midwest and the second financial capital of the United States
The city is strategically located on the freshwater Lake Michigan, is the third most populous city in the United States after New York and Los Angeles and has a strong and highly diversified economy with the latest available figures showing the region delivering a GDP of $593.97 billion in 2020. Chicago is home to numerous Fortune 500 companies as well as to the Chicago Mercantile Exchange, one of the largest financial exchanges in the world.
Chicago is a major center for transportation and is the largest hub of highway and railway connections in the country, making the region a vital cog in the American economic engine. Chicago also has two large international airports, with the north-side O'Hare International Airport routinely ranking among the world's top six busiest airports and only a 45 minute drive into downtown Chicago.
In addition to its central and accessible location, a relatively contained cost of living, the presence of an abundant and highly skilled workforce, and all the cultural and educational amenities of a world-class city, Chicago offers enterprise businesses and potential employers strong fiber connectivity and a reliable power grid. Not only are electricity costs lower than the national average, power disruptions as a result of catastrophic natural disasters — the city has only recorded nine earthquakes since 1838 and only two “significant” tornadoes in the city limits throughout its history— because of its central geography and expansive emergency response services.
These features, as well as the relative affordability of land and the cooler climate, make Chicago an excellent choice as a data center location. And indeed, a recent study named Chicago the number two data center market in the world. In the same study, Chicago was placed in the top ten for categories including development pipeline, fiber connectivity, cloud availability, land price, vacancy, and market size.
To bolster Chicago’s attractiveness as a data center destination, Illinois instituted a data center tax incentive package in 2019 for developers planning to invest $250 million or more. Digital Realty is one of the few data center providers to have qualified for the incentive, and thereby can extend the tax exemption to qualified tenants.
Chicagoland Digital Ecosystem and the Challenges of Data Gravity
Over the last decade, the volume of data being created and processed globally has grown exponentially:
- IDG has revealed that data volumes are growing at an average of 63% per month.
- Chicago will face the 8th highest data gravity intensity increase by 2024 in industries such as insurance, finance, and manufacturing.
- The World Economic Forum estimates that over 463 exabytes of data will be created every day by 2025.
- According to IDC, by 2025, 80% of data worldwide will reside in enterprises.
For businesses in Chicago and elsewhere, this explosion in data growth has serious implications because as data creation accelerates and processed across organizational locations, it becomes increasingly difficult for the enterprise to manage independently.
The term Data Gravity has been applied to this phenomenon — which is present in almost every major metro worldwide. Effectively, Data Gravity describes the process whereby the accumulation of data results in the parallel accumulation of applications, systems and services required to store and process that data. When data volumes grow exponentially, traditional data architectures simply cannot keep up with the proliferation.
With the data mass too unwieldy to be moved between data centers, cloud services and networks, data architectures need to evolve and become data-centric, bringing users, applications and networks to the data instead.
To learn more about Data Gravity, watch the video.
Digital Realty developed the Data Gravity Index™ to measure the intensity of Data Gravity across more than 50 metros and 23 industries globally. In each case, the Data Gravity Intensity score, as measured in gigabytes per second, provides a relative proxy for measuring data creation, aggregation and processing.
Data Gravity Intensity is expected to grow by a compound annual growth rate (CAGR) of 139% globally through 2024. The index pegs a CAGR of 122% through 2024 for the Chicago Metro area.
Data-Centric Architecture Based on PlatformDIGITAL®
Data Gravity inhibits enterprise workflow performance, raises security concerns, and increases costs.
PlatformDIGITAL, provides a Pervasive Data Center Architecture (PDx™) that addresses these concerns with a step-by-step strategy to implement a new IT architecture required for digital businesses to scale. With close proximity to major global internet exchanges and SDN-enabled cloud on ramps PlatformDIGITAL creating robust, interconnected data communities. Enabling enterprises to seamlessly link with cloud and content providers to share data between users across channels and geographic locations.
Accessing a Data-Centric Architecture in Chicago
For enterprises with network-dense or large data hub applications, Digital Realty is the only investment grade, publicly-traded data center provider in the Chicago area offering a full suite of options.
With facilities spread over approximately 3.5 million square feet both downtown and on suburban campuses, and 150 MW capacity, Digital Realty supports single cabinet to multi-megawatt deployments, as well as flexible options ranging from shell space to turn key flex scale solutions.
Each Digital Realty property is in close proximity to network, cloud, and content ecosystems available within the metro, as well as via ServiceFabric™, Digital Realty's interconnectivity solution and orchestration platform designed to support the wider industry shift to data-centric architecture. This solution prioritizes cost-effectiveness and speed to market, without compromising on performance or latency.
For an overview, download a copy of Digital Reality’s Chicago Metro Brief.
Follow this link and get the details on the 9 data centers in Chicago or simply contact us to find out if your expansion qualifies for tax-exempt status or to schedule a tour.