HP Expands Services Into Data Center Construction

HP, which already offers services around designing and equipping data centers, is looking to now be the general contractor on projects through its new CFI service.

Hewlett-Packard, which already helps enterprises plan and design their new data centers, now wants to be the general contractor on the projects.

HP on Feb. 15 unveiled its CFI (Critical Facilities Implementation) service, a move company officials said will streamline the process of building data centers and give enterprises one place to go for the entire process.

"There is tremendous demand [from businesses] to have a single point of contact," Rick Einhorn, worldwide director of Critical Facilities Services for HP, told eWEEK.

The move comes at a time of expected growth in data center construction. HP officials pointed to a Gartner study that indicated that 46 percent of respondents to a survey said they will build one or more data centers in the next two years, and 54 percent said they will have to expand existing facilities during the same time period.

Having a single vendor to oversee the entire process will help drive down overall costs, Einhorn said. Up to this point, HP has offered services that covered the bulk of the steps in the multi-million-dollar process of building a data center, from assessment and design to project management and equipment.

"In the past, what was missing was that building piece," he said.

HP has worked as the general contractor in some smaller projects in parts of Asia the last few years, getting the process down, David Dnistran, worldwide CFI director for HP's Critical Facilities Service, said in an interview. Now the company wants to expand that implementation aspect to larger data center projects worldwide in both emerging and mature markets, Dnistran said.

It probably will take a bit longer to find traction in the more mature markets, which he said tend to be more conservative and stick with what they know. However, Dnistran and Einhorn said they expect to grow the CFI business in such regions as North America and Europe.

Both said HP's experience in designing and building its own data centers would be a key selling point. Several years ago, the company underwent an aggressive program to consolidate 85 global data centers into six, a move that not only helped HP save millions of dollars but also could be used as a showcase for the company's facility skills and data center equipment.

HP also has been aggressive in the advancement of environmentally-friendly data center designs that aim to help business reduce the power consumption at their facilities. HP bulked up its expertise in this space in 2007, when it bought EYP Mission Critical Facilities, a company that specialized in data center construction services.

The data center construction industry represents a lucrative market for HP. Einhorn said he has seen market estimates for the design and construction of data centers at as much as $30 billion or more. Over the past few years, as the economy soured and recession took hold, spending in this area was down, he said. However, now businesses are beginning to build again.

"The market is huge, and it's a big pie out there," Dnistran said. "We want our slice of that pie."

Einhorn said HP wasn't looking to run construction companies out of business; rather, he'll be looking to partner with such companies, though now not only as the designer and architect of the facility, but also as the general contractor.

He said CFI would operate as an autonomous consultant, and wouldn't be used as a way to just sell more HP equipment.

"If a customer is an HP house, great, we'll go in that direction," Einhorn said. "If they prefer another [data center equipment] vendor, we can work with that as well."