GE Targets Data Centers With New Business Unit
March 12, 2013
This week GE announced the creation of a new business unit called Critical Power. The new business combines services and products designed for industries that require reliable supplies of electricity, including data centers, telecommunications facilities and hospitals.
I spoke with Jeff Schnitzer, president of the newly formed Critical Power business, to get more details. GE is taking power quality products, power switching controls, and DC power systems and bundling them with services such as design and support to appeal to mission-critical facilities. GE products cover most power distribution components, but those products have been offered under different business units. It's clear that GE wants to streamline the purchase process for potential customers, and add more revenue via services.
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Mission-critical power systems are no longer a niche play for big manufacturers such as GE. The growth of cloud services for consumers and businesses has ramped up data center construction, and there's increasing demand for high availability and energy efficiency in both new and existing data centers. According to GE, data centers now accounts for 3% of annual U.S. electricity consumption.
This growth has sparked a turf war between the power system manufactures as they consolidate and compete. The modern data center is an odd confluence of products and manufacturers, including Emerson and its Liebert line of UPSs and Power Distribution Units (PDUs); Schneider Electric's APC UPSs and PDUs; and Eaton Electric's Cutler-Hammer breakers and USPs. At the facility level you have GE, Siemens and ABB.
Few vendors have products that span the utility industry down to the power supplies embedded in the technology. Fewer yet have the expertise to squeeze efficiency from the entire electrical distribution system. GE has the products; the question is whether this new Critical Power Business will give GE the focus it needs to be more competitive.
To my eyes, GE's move is as much about product alignment as it is about understanding the challenges of operating and maintaining a data center. By packaging products with lifecycle management, GE is trying to differentiate itself through a focus on TCO.
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The company is also taking advantage of the services of another branch of the company, GE Capital. The company announced it is offering to finance the purchase of equipment, such as its UPSs. GE suggests that the operating costs savings for its SG series UPS, which includes "eboost" technology that GE claims enhances energy efficiency, will cover the cost of replacement.
Just how well GE's claims stack up remain to be seen. That said, I think data center operators will benefit from the increased competition that GE's strategic move introduces to the market. The company's alignment and emphasis on TCO is refreshing. Let's see whether GE can shake things up.
Ken Miller is data center architect with the IT Infrastructure and Operation Services division of Midwest ISO, developing mission-critical facilities.