Is green storage a dead end?

Greenery will choke storage suppliers

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The SCSI Trade Association website has run an article entitled The Data Center’s Green Direction is a Dead End by Steve Denegri. It argues that the storage industry is effectively in denial and that we need more energy, not less, for the health of our industry.

Denegri is a storage consultant and financial analyst. His pitch is that: “Countless industries have reached an energy ceiling over the past half century, only to realize soon after that revenue potential had peaked.” Storage could be becoming one of these and suffering the consequent industry contraction and “massive shakeout”.

“The cold, hard truth is that an ample supply of energy is necessary to grow any business over the long-term, and the storage industry is shying away from the harsh reality that a sufficient amount of energy is, unfortunately, not available to keep the industry growing.” We need to “expand the capacity of the power grid” instead of “embracing the energy efficiency paradigm”.

This is contrarian thinking with a vengeance. Is it justified?

The author argues that customers don’t really want green — meaning lower energy-using — storage but lower energy bills and the removal of supply constraints. He says that pursuing energy-efficient products will hit the brick wall of the diminishing returns law with succeeding product generations costing a lot more to develop but saving a lot less energy.

“The return on investment (ROI) for the R&D that will be necessary to expand the storage benefit per consumed watt will almost certainly shrink over time, resulting in lower and lower profit margins. Flat to shrinking revenue and declining ROI are the ingredients of a decaying industry.”

He reckons that the Uptime Institute is right in saying that server virtualization benefits will peak in 2010 at which point more physical servers will be needed per data center. “In order to satisfy the demand, the Uptime Institute suggests that ‘multiple thousand-megawatt’ power plants will be needed once the server virtualization benefit phase ends.”

The crux of his article declares: “Green computing is almost the equivalent of battling a raging inferno through the design of smaller matches. If only (the storage industry) consortia realized that by hailing their energy-efficiency activities, they merely appear content with a reputation of environmental responsibility as they proclaim their industry’s doomed state. In fact, without more power plants, the typical storage industry consortium had best realize that its membership numbers will soon be on the decline. As the automotive industry’s experience proves, the number of suppliers to the storage industry will soon fall off of a cliff.”

We should heed the lessons of the similarly OEM-dominated automotive industry, where the supplier-to-OEM ratio has shrunk, he says, because “the automotive industry saw a major transition to energy-efficient products beginning in the late 1970s”.

He wants the storage industry and its representative consortia to fight to expand the power grid. We need more energy to grow. It’s left unsaid, but if that has to be greener energy then so be it. Cover the deserts with solar panels, whatever, but release the energy-constricting choke hold from data centers’ necks because it will kill our industry and many suppliers will go out of business.

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