Customer perspective
Another major consequence of the tax, IDC associate director, Matt Oostveen says, will a push to truly understand electricity use within IT departments through the use of data centre infrastructure management software, consulting services and monitoring applications.
As Oostveen puts it, the issue is that no-one really knows how much electricity they are consuming, because more often than not, IT departments aren’t the ones paying for it.
“If you ask CIOs they will say the electricity budget rests inside facilities,” he says. “Rarely do I meet a CIO who is acutely aware of how much they are spending on electricity.”
“It’s the old consulting adage: You can’t improve what you can’t measure. At the moment we can’t measure what we are consuming in our data centres. We need to get to step one, before we can get to steps three, four and five.”
As a result of the tax, as well as major electricity prices rises occurring independently in many states, people are asking whether they even want to run their own data centres anymore. People are also asking whether the reason to move to the Cloud has finally come.
“In our surveys with CIOs we ask them if they even want to be buying servers and storage in three years from now. There are a lot of people are coming back and saying that that is not a position they want to be in — that their organisation would rather begin utilising Cloud-like technologies to deliver those types of services to the organisation,” Oostveen says.
Offshoring data
Another likely reaction to the carbon tax by both customers and data centre operators with offshore operations will be the drive to store data offshore in order to avoid the tax altogether.
Oostveen, says that while he’s yet to see numbers validating the idea that IT departments will turn to overseas providers to avoid the tax, offshoring infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS)-type solutions will look increasingly attractive to smaller and medium enterprise.
However, current data sovereignty laws and guidelines mean organisations in the government, banking and insurance sectors will be forced to stay within the bounds of Australia and be subject to the tax.
That is, of course, until the laws and guidelines are loosened under increased pressure from business.
“We are monitoring the development of Federal Government data sovereignty guidelines, which would increasingly mandate more aspects of constituent data remain on shore and the impact that the introduction of the carbon tax will have on data centre providers to deliver this efficiently,” ASG Group’s Strautins says.
“Many companies looking to offshore their data centres as a way of avoiding cost increases caused by carbon tax will need to navigate a potentially sensitive trade off between data sovereignty, security issues and rising data centre costs.”
In fact, given the right circumstances, and the wider push for cleaner energy sources, the tax could lead to a major phase of offshoring of data to New Zealand, IDC’s Oostveen adds.
“Some people will say [power generation] isn’t their problem, but if we have New Zealand sitting just off our shores and they have the majority of their electricity produced by renewable methods, and, if our legislation is lifted or changed to allow information to reside in New Zealand — which is the first logical country you would allow this to happen — and, if we increase the data linkages between the two countries, then it makes a lot of sense to start basing your data in New Zealand,” he says.
“I think that is inevitable, but it is a question of when. This is a five-year window and when we get to that point it will dramatically change the data centre landscape in