ZebraHost Blog

Iowa has become the leader in the Midwestern US for data center growth. Giants like Google, Facebook, and Microsoft have not only built data centers in Des Moines Iowa but actively expanded and reinvested in them over the last 2 decades. Apple, which has yet to establish a presence in Iowa, has stated that Iowa is the next location for an Apple data center. The location will specifically be Waukee. Waukee, like Altoona, is a suburb of Des Moines (the most popular city to start a data center in Iowa). When businesses say they have a Des Moines data center, it often means that the data center is in a suburb of Des Moines.

Facebook, Apple, Google, and Microsoft, some of the wealthiest companies in the world have undoubtedly been presented offers in other locations in the US and regional Midwest but chose Iowa. Why has Iowa been put on the map for them? Because Iowa provides companies advantages that virtually no other location in the US can replicate like open flat land, renewable energy, natural disaster resistance, and generous state and local subsidies.

A Central Location is Everything

Global tech leaders like the aforementioned care primarily about one thing. Delivering a fast, low latency solution to their clients. What makes Iowa such an attractive market starts with the location. Des Moines Iowa is flat land in the heart of the US not too far from most markets. Having a data center located directly in the center of the US allows tech companies to deliver a consistent, low latency solution to all their users. Contrast this to having a data center somewhere like California where West Coast customers would receive exceptionally low latency but other users could potentially experience high latency.

Generous Subsidies

Subsidies can be had in other markets, but Iowa, and more specifically Des Moines and surrounding metros like West Des Moines and Altoona, have offered generous subsidies to tech companies to build data centers. Apple, Google, Microsoft, and Facebook have all either spent or pledged to spend a minimum of $1 billion on each of their data centers.

Apple, the most recent tech giant to agree to build a data center in the Des Moines metro has received $207 million in subsidies that will primarily be paid out over tax breaks over 20 years. But taxes aren’t the only form of subsidies available to Iowa. Equipment, energy, and water can be either subsidized or tax exempt.

Large tech companies are clearly getting a very good deal in Iowa. But they aren’t the only ones. Smaller companies can either co-locate their own servers in third-party Iowa data centers such as LightEdge, or they can choose to host data with a cloud provider like ZebraHost. Some of these subsidies and less expensive Midwest labor costs go towards offering clients an excellent deal for hosting data in Iowa. Going with a cloud provider in Iowa like ZebraHost can net you an excellent rate.

Colocation has become a popular service specifically in Des Moines data centers because the metro has many small to medium tech companies. Colocation allows businesses in Iowa’s largest city to own their own hardware and control their data without having to invest in their own data center. Light Edge in Altoona Iowa is a popular location for colocation services.

Natural Disaster Resistant

Because Iowa is located on flat, land-locked land, natural disasters like hurricanes, flooding, Earthquakes, etc do not affect Iowa data centers anywhere near as frequently as other markets. Big tech companies and smaller companies invest heavily in data centers. Purchasing thousands of servers can cost hundreds of millions of dollars such as Apple’s proposed spend of $600 million in hardware for its new data center. So the risk of this hardware becoming damaged due to a natural disaster is a huge consideration.

A greater concern is downtime. Downtime is the amount of time a server is offline preventing a user from accessing data. Downtime based on hardware can be managed with backups and high availability stacks, and redundant power supplies. But not having power due to a hurricane can be challenging. Just 24 hours down could cause a data center to go under. The less risk of hurricanes or other disasters that can potentially disrupt power flow is a huge advantage for Iowa data centers.

In the event of a disaster, Iowa data centers, especially Des Moines data centers, are well prepared. Iowa recently suffered from a Derecho which is an inland hurricane. ZebraHost’s data center was well prepared with power generators, and an hourly coordinated refuel supply chain. So even if disaster strikes, businesses are well assured that they are going to maintain consistent uptime in Iowa.

Open Flat Land

Iowa is corn country. And for a business looking to establish a data center that’s a good thing. Even in Des Moines and the surrounding area, the land is very available and not densely populated. This means there is ample land for a tech giant like Facebook to build a data center campus.

This also means that Des Moines and the state of Iowa are poised to experience even greater data center growth. With more land available than in other markets, and flat land being easy to develop on, Iowa will continue to build many data centers. Some for tech giants, and many will be independent. This means that there will be greater competition and a need to provide competitive pricing and excellent service for those that host in Des Moines.

Renewable Energy

Big tech companies have pledged to reduce their carbon footprint. And their Iowa data centers are playing a decisive role in helping them achieve that. Because of Iowa’s flat, open land it’s an excellent area to host wind farms. Part of the reason wind farms haven’t seen widespread usage is that they are loud and thus not suitable for residential areas. But data centers tend to cluster in campuses away from residential areas. Wind farms now provide much of the energy for Iowa data centers.

Facebook for example powers its data center via 100% wind energy making it entirely renewable. Iowa’s dedication to renewable energy has made it a unique market for data centers because data centers typically require large, and frankly unsustainable amounts of power. Having open flat land and affordable renewable energy has made Iowa somewhat of a Goldilocks for tech giants looking to save money and hit renewable energy goals.

Iowa Isn’t Perfect

Despite making significant progress on becoming a data center market that attracts both businesses looking to collocate as well as large enterprises, Iowa still has challenges that rival markets like Kansas City or Chicago Don’t. Namely the small population and less developed infrastructure.

Despite Iowa’s significant data center growth and popularity with tech giants, the number of data centers is small. And when it comes to data center space by the square foot, big cities in Iowa pale in comparison to competing cities like Kansas City.

Iowa also doesn’t have the strongest internet (yet). Although Des Moines data centers specifically enjoy strong fiber connections, many data centers and carriers only currently support 1G internet compared to other markets with 10G.

Finally, and you probably guessed it, Iowa has a small population. This hurts Iowa’s viability for some companies looking to invest in infrastructure in Iowa because the market the data would be hosted in itself likely wouldn’t be the primary market. Some companies have to decide, “would I rather have my data hosted in Chicago where many of my users are or save money in a Des Moines data center?”. Tech giants like Facebook and Google likely don’t worry about this because they are serving so many users at a distance anyway, but a startup that wants to target a specific area with their services to start might question an investment in Iowa. Iowa’s small population also means fewer people to take on tech roles which can be a problem if the company wants to expand beyond just a data center and build a full-fledged presence.

Conclusion

Over the last 20 years ZebraHost has been in business we have witnessed Iowa going from tech fly-over land to a hub for data centers. And it pleases us that we can offer such competitive cloud solutions for our clients in our home state because of it.

ZebraHost, like big tech companies, will continue to invest in our presence in Iowa so that we can offer a phenomenal low latency solution for our clients. If you are looking for an excellent, low latency cloud provider to host your data in Iowa we have a presence in Des Moines. Our Des Moines data center is Tier III and suitable for data covered under 10 different certifications including some of the most strict like HIPAA and PCI. Give us a call so we can offer you a consultation and figure out how to provide exceptional value and reliability.

Why Is Big Tech Investing in Iowa Data Centers?