AEP data center marketing webinar

Marketing your AEP
Qualified Data Center Site
September 25, 2013

aepdatacenters.com 2
Presenter Panel
Amy Koscielak
AEP
akoscielak@aep.com
(614) 716-1008
Tim Comerford
Sugarloaf Associates
tcomerford@BLSstrategies.com
(973) 908-8232
Will Steffens
wsteffens@sugarloafassociates.com
(973) 908-8232
Pat Lawrence
AEP
rplawrence@aep.com
(614) 716-3441

AEP At-A-Glance

Partners in Marketing
aepdatacenters.com

Marketing Strategy
INDUSTRY
KNOWLEDGE
• Industry Basics
• Industry Trends
• Economic Benefits
LEAD
GENERATION
• The Right Contacts
• Multiple Channels
• Multiple Touch Points
PROSPECT
DEVELOPMENT
• Handling Inquiries
• Incentives
• Closing the Deal

Industry Basics
KnowledgeKNOWLEDGE

Types of Data Centers
• Colocation
• Retail (small requirements)
• Rack level
• Service Based
• Examples
• Cervalus
• Savvis
• NY Internet
• Data Pipe
• Wholesale (used for larger requirements)
• White space
• Primarily selling infrastructure
or conditioned space
• Examples
• Digital Realty Trust
• Dupont Fabros
• Enterprise (large corporate or service
providers)
• Examples:
• Apple
• Facebook
• Goldman Sachs
• Cloud (IT services provided via
telecommunications with the end user
unaware of where data is hosted)
• Examples
• Amazon
• Google
• Apple
• Modular (small units to allow for greater
flexibility and efficiency
• Examples:
• Compass Data Centers
• IO

Tier Ratings
The major difference (other
than reliability) is the
construction cost for the
facility. Costs will range from
$1,000 to $ 4,000 per square
foot (exclusive of IT and site
costs).
TIER 1
Less than 28.8 hours downtime/year
TIER 2
Less than 22 hours downtime/year
TIER 3
Less than 1.6 hours downtime/year
TIER 4
Less than .4 hours downtime/year

Site Location Factors
1. Power Availability and Reliability
2. Telecommunications / Connectivity
3. Site Variables
• Water
• Sewer
• Zoning
• Access
4. Site Risks
• Natural
• Manmade
5. Utility Costs
6. Labor Availability
7. Vendor Access and Proximity
8. Security
9. Transportation
10.Site / Development Costs
11.Incentives
12.Renewable Alternatives
Some Rules of Thumb:
• 50% of a building is normally white space
• Designed power densities of 150 – 300 watts/sq.
ft. are common
• Water demand example: 132k sq. ft. data center
= 5,729,000 gallons / month

Fiber
Source: Allied Fiber

• Web
• Data Center Knowledge http://www.datacenterknowledge.com/
• Telcom Ramblings http://www.telecomramblings.com/
• Data Center Dynamics
http://www.datacenterdynamics.com/news
• Research Organizations
• 451 Research https://451research.com/
• Gartner Group http://www.gartner.com/technology/home.jsp
• Lawrence Berkeley National Laboratories http://www.lbl.gov/
Research and Resources

Industry Trends
KnowledgeKNOWLEDGE

Current Market
Source: Data Center Sites

What’s Causing the Demand?
In the past 5 years, the number of
internet users has increased from
1.043 billion (16% of the world
population) to 2.11 billion (30%
of the world population).
Estimated total colocation space in
use in the U.S. in 2011 was 67.7
million sq. feet. This is projected to
expand to 144 million square feet
by 2015, based on growth
projections by providers. Data Center
Knowledge
TechNavio's analysts forecast the
data center construction market in
the US to grow at a compound
annual growth rate of 7.61% over
the period 2012-2016.
Roughly 8.75% of total enterprise
data center space is currently in
colocation. That total will increase
to 14.11% by 2015. Data Center Knowledge

Market Forecast
14.66
17.00
20.54
24.81
14.07
20.76
23.73
30.81
0.00
5.00
10.00
15.00
20.00
25.00
30.00
35.00
2012 2013 2014 2015
Colocation Supply vs. Demand
New Space Available New Space Required
Source: Nemertes Research / Data Center Knowledge
The bottom line? Enterprise colocation demand will outstrip colocation service provider
supply starting this year, unless colocation providers expand at a faster rate than current
growth rates would indicate. In other words: Watch out for the coming colo crunch!

• Modular
• Growth of colocation
• Cloud
• Smaller sites
• Second tier markets
• Increased densities
• Energy efficiency
• Wholesale / Retail convergence
• Recognition of incentives
• Increased demand for data
• Banks seeing 50-100% growth in data requirements
• Cisco –internet traffic growing 61% from 2007 - 2012
• Selling bytes not power
• Green
• Solar
• Cogeneration
• Renewable resources
The most important trend? Data center expansion into the second tier markets and the
opportunity it provides. Think of data and the access to telecommunications as an ED tool.
Trends

Economic Benefits
KNOWLEDGE

Building Specifications
Building Size: 230,000 SF
Interior Portion of Building to Be Renovated in Phase I: 58,800 SF
Rack Space (raised floor computing area available to
tenants):
30,980 SF
Network Operations Center (NOC): 3,700 SF
Mechanicals and Supporting Infrastructure: 6,300 SF
Office: 6,800 SF
Miscellaneous (restrooms, etc.) 11,020 SF
Total Estimated Construction Expenditures $54,319,795
Project Example

Estimated Economic Impacts (Direct, Induced and Indirect) Over Ten Years
Impacts to
COOK COUNTY, IL
Job Creation
Earnings Added to
Local Economy*Direct
Indirect and
Induced Total
Construction Phase NA 642 642 $30,103,111
Ongoing Operations 22 143 165 $72,022,310
Potential Implications
Over Ten-Years
22 785
(temp +
permanent)
807
(temp +
permanent)
$102,125,451
* “Earnings” refers to total earnings added to the local economy, not the specific
revenues of the data center itself.
Estimated Net Tax Revenues
Taxing District
Net New Tax
Revenues Over
10 Years
Board of Education $2,810,080
City $850,020
County $451,700
Forest Preserve District $56,700
Metropolitan Water Rec. Dist. $312,850
City Library Fund $108,500
City School Building & Improvement Fund $116,350
Community College District $161,300
Park District $338,830
Total $5,206,700
Construction & Taxes
Three Types of Job Creation
Data centers contribute to local
employment in three forms:
• Direct jobs – employees of
the data center
• Indirect jobs – jobs created
within the data center’s
supplier network to service
the new facility; and
• Induced jobs – increased
employment in the
consumer4 sector as a
result of the spending of
wages in the local economy
to pay for groceries, clothes,

Employment Projections
Job Title Employees Average Wage*
Security 8 $25,220
Salesperson 2 $77,740
Engineers (Hardware and Software) 2 $90,080
Building Cleaning Worker 1 $28,460
Data Center Manager 1 $115,240
Data Center Technicians & Network Admin. 8 $77,150
TOTAL Jobs/Weighted Average Wage 22 $59,014
* Based on U.S. Bureau of Labor and Statistics. May 2011 Metropolitan and Nonmetropolitan Area
Occupational Employment and Wage Estimates. Chicago-Joliet-Naperville, IL Metropolitan Division.
Employment

The Right Contacts
LEAD GENERATION

• American Electric Power (AEP)
• Engineering Firms
• Architects
• Technology Community
• Vendors
• Generators
• Hvac
• IT Companies
• Telecommunication Companies (Large and Small)
• Developers
• Real Estate Brokers
• Trade Associations
• Colocation developers
• Site selectors
• Consultants
• Construction firms (including project management)
• Internet and media
The Data Center Network

Multiple Channels,
Multiple Touch Points
Lead GenerationLEAD GENERATION

• Networking
• Web and Social Media
• Develop your LinkedIn to target the industry
• E-blast
• Direct
• Trade Shows/ Events
• AFCOM – annual event “Data Center World”
• 7x24 National– bi annual conference (east and west coast)
• 7x24 Regional – local chapter events
• Data Center Dynamics – private group that sponsors regional events
• IMN
• Cap rate events – private group that runs events (National Data Center Series)
• Events associated with data center operations
• IT related trade groups
• Trade Associations
• AFCOM – (http://www.afcom.com/ ) national and local
• 7x24 (http://www.7x24exchange.org/ ) national and local
• Green Grid (http://www.thegreengrid.org/ )
• Uptime Institute (http://uptimeinstitute.com/ )
Channels that Work

Direct Marketing
Personal ContactEmailMail

Direct Marketing
Personal ContactEmailMail
End Users Consultants
1. Minimize Risk
2. Reliable Power
3. Speed to Market
Three Campaigns

Strategic Events
AEP 2013 Calendar
Data Center World Spring Conference
IMN Data Center Spring Forum
7x24 Data Center Spring Conference
7x24 Data Center Fall Conference
EUCI Data Center Forum

Advertising

Social Media

Responding to Inquiries
PROSPECT DEVELOPMENT

Information & Local Knowledge
• Key data
• Power infrastructure
• Sewer
• Zoning
• People
• Answer inquires quickly or get back to them ASAP
• Position yourself as the “go to” person
• Know the sites and have an inventory
• Know the key people
• Know the answers and if not, know how to get them quickly
• Sell others on the “need for speed”
• Remember the client will follow-up with in depth due diligence, but you need to
provide quality answers to the critical questions
• Build a network
• Sell the incentives
Usually a user has a deadline to satisfy a client or corporate need and will default to the
“path of least resistance”. As an economic developer, you provide a unique resource to a
site selector-- local knowledge.

Incentives
PROSPECT DEVELOPMENT

• Data center targeted incentives are relatively new due
to the perceived lack of job creation.
• Currently over 15 states offer data center specific
programs and incentives.
• Most programs center on tax exemptions or credits
• Business personal property tax
• Sales taxes
• Real property taxes
• Investment tax credits
State Incentives

States with Incentives
• Alabama: Real & personal property tax abatement
• Arizona: Exemption from sales tax on building, equipment & power
• Iowa: Sales & Property tax exemptions
• Louisiana: Up To 10 year property tax exemption
• Minnesota: Full exemption on Personal Property, 20 year sales tax exemption, 20 year sales tax exemption
on energy
• Nebraska: Sales tax exemptions, person property exemption, job tax credit, investment tax credits
• North Carolina: Sales tax exemption to 1%
• New York: 20 year PILOT, sales tax exemption
• Ohio: Sales & Property tax exemption
• Oklahoma: Sales & property tax exemption
• South Carolina: Sale tax exemption on power, equipment & software
• Tennessee: Sales tax exemption, Tax Credits, Reduce sales tax on energy
• Texas: Sales tax exemption on power, and equipment up to 15 years (effective 9/1/13)
• Virginia: Sales tax exemption
• Washington: Sales tax exemption
• West Virginia: Sales tax exemption on construction, equipment & software; salvage value of personal
property.
• Wyoming: $2 million in grants for energy efficiency
Other states have incentive programs that a data center project may be able to take advantage, however they
do not specifically target data centers.

Partners in Marketing
• Prospecting lists
• Web
• Advertising & collateral
• Email marketing
– Constant Contact
– Discounts for 501(c)(3)
– www.constantcontact.com
AEPED.com Property Quick Links
Roanoke County Center
for Technology
www.aeped.com/rccrt
Industria Centre Site #17 www.aeped.com/ics
Progress Park www.aeped.com/progresspark
Cherokee Expressway #10 www.aeped.com/ceip
Wolpert Greenfield Site www.aeped.com/wgs
National Cyber Research
Park
www.aeped.com/ncrp
Findlay Commerce Park www.aeped.com/fcp
Bradley Square www.aeped.com/bradleysquare
The 59 Industrial Park www.aeped.com/59ip

Contact Us
Amy Koscielak
AEP
akoscielak@aep.com
(614) 716-1008
Tim Comerford
tcomerford@BLSstrategies.com
(973) 908-8232
Will Steffens
wsteffens@sugarloafassociates.com
(973) 908-8232
Pat Lawrence
AEP
rplawrence@aep.com
(614) 716-3441

 Tier 1 Provider - is one that can reach every other network on the Internet without purchasing IP
transit or paying settlements. They can be regional, national and international.
 Tier 2 Provider - A network that peers with some networks, but still purchases IP transit or pays
settlements to reach at least some portion of the Internet. Resellers of services from
tier 1 networks.
 Tier 3 Provider - a network that solely purchases transit from other networks to reach the Internet.
 Long Haul – long distance fiber primarily provided supporting the Tier 1 networks
 Metro / Short Haul – Tier 2 and 3 networks.
 PoP –point of presence is an access point to the Internet. It may be either part of the facilities of a
telecommunications provider that the Internet service provider (ISP) rents or a location separate
from the telecommunications provider. ISPs typically have multiple PoPs, sometimes numbering
in the thousands. PoPs are also located at Internet exchange points and colocation centers.
 ISP – Internet Service Provider - business or organization that offers users access to the Internet and
related services. Many but not all ISPs are telephone companies or other telecommunication
providers.
 IXP – Internet Exchange Point - a point through which Internet service providers (ISPs) exchange
Internet traffic between their networks.
 Meet me Room - is a place within a colocation center where telecommunications companies can
physically connect to one another and exchange data.
 Cross Connection – connections from one network to another.
Fiber Definitions

AEP data center marketing webinar

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