IBM Sees Green IT Pastures in Emerging Markets

By Jeffrey Burt  |  Posted 2009-11-05

IBM Sees Green IT Pastures in Emerging Markets

IBM recently inked three large-scale deals to help companies overseas design and build energy-efficient data centers, the latest examples of the hunger for green IT in emerging markets.

IBM Nov. 5 announced a $5.4 million deal with Cosan, a sugar-energy group based in Sao Paulo, to redesign its IT infrastructure, and another deal with Slovak Telekom to build a new data center in Bratislava, Slovakia. In addition, IBM signed an IT services deal with the Haryana-based Indian subsidiary of confectionary company Perfetti Van Melle to design, build and manage a green data center.

The deals reflect the demand IBM officials are seeing in such emerging markets as South America, Eastern Europe and parts of Asia and the Middle East for IT solutions that will improve business while keeping energy costs low, according to Steve Sams, vice president of IBM's Global Site and Facilities Services business.

"It's a demonstration that the economy is not holding back on major investments in green technology in these emerging markets," Sams said in an interview.

IBM officials say such regions are adopting green IT more quickly than more developed markets, such as the United States and Europe, and that half of IBM's green data center revenue over the past two months came from outside the U.S. market.

There are a number of reasons, Sams said, including that many of these fast-growing markets do not follow the traditional IT path. He pointed to India as an example, noting that as growth in the region took off, the market essentially skipped the traditional wired IT infrastructure and headed directly to wireless.

Similarly, many of these markets are skipping right to green technologies, Sams said.

Other issues also come into play, including the high cost of energy in many of these areas and the limited access to power, he said.

For Cosan, IBM will design a data center that will consolidate workloads onto two Power System 570 servers armed with virtualization technology and optimization resources. The new facility will replace a distributed server infrastructure.

In Slovakia, IBM will build a 1,200-square-foot, five-floor data center that during cold months will use outside air to help cool the facility and will have systems grouped according to heat emissions to optimize cooling capacity. The data center is expected to go online in 2011.

For Perfetti Van Melle India, IBM will design, build and manage a 1,000-square-foot green data center.

Green IT Trend Goes Global


Worldwide, businesses are looking for ways to cut their IT power and cooling costs, particularly given the rise in energy costs and an economy that is forcing IT departments to increase the services they provide while their budgets are shrinking. Top-level executives also are beginning to become more engaged in IT costs, and government regulators also are turning their attention to the amount of power consumed by data centers.

Research company Gartner recently listed green IT and reshaping data centers as among the top five IT strategies for 2010.

Green IT also has become a target for vendors, from component makers such as Intel and Advanced Micro Devices to top-tier companies such as IBM, Hewlett-Packard and Cisco Systems, which are making their products more energy-efficient in ways designed to help businesses drive down power costs.

IBM kicked off its Project Big Green initiative in 2007, promising to spend $1 billion per year over three years to help businesses become more energy-efficient. Sams lauded the success of the program, saying businesses understand that better-designed data centers can help them save on not only capital expenses, but also operating expenses.

Using energy-efficient power and cooling methods-such as using outside air to help reduce the heat, an approach called free cooling-and expanding the data center in a modular fashion can reduce upfront capital costs of new data centers by as much as 40 percent and enable businesses to reduce operational costs by as much as 50 percent, Sams said.

Businesses are getting the idea, he said. About 18 months ago, about 12 percent of survey respondents said they were interested in a modular "pay as you grow" data center design. A more recent survey showed that 80 percent were interested.

Enterprises also are showing increased interest in optimizing their existing data centers for energy efficiency, Sams said. Doing so can reduce energy consumption by as much as 50 percent, which can extend the life of a facility. IBM was able to avoid a $53 million addition to its data center in Lexington, Ky., by consolidating and virtualizing 60 percent of the servers and improving cooling capabilities, all of which increased the IT capacity of the facility by eight, he said.

Businesses with multiple data centers also can save by consolidating facilities, Sams said. As an example he again cited IBM, which between 1997 and 2007 cut the number of its data centers from 235 to 12, doing away with $4.1 billion in costs over the past five years.

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