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Space Race

The growth in data volumes, regulatory compliance, and fresh interest in disaster recovery are causing more than a need for bigger and better storage. They are also the forces behind a new push for data center space.

It's more than a matter of where to put it all. Companies are outgrowing their data centers in part because of regulations such as Sarbanes-Oxley, which require firms to have one full replica of key data within a given geographic range. Other factors include a new focus on disaster preparedness, motivated by the aftermath of Katrina and other dire acts of man and nature.

Online services, requiring a sizeable data center infrastructure, have also become a fact of life instead of an oddity. "Businesses now know how to make money online," says Pervez Delawalla, CEO of Net2Ez, which provides managed data center services in Los Angeles.

But Delawalla and others in the business of providing data center space say demand isn't growing just because firms need more floor space. There's also a power struggle underway of an electrical nature.

"Equipment may take up a smaller footprint now, but power requirements can be much higher," says Stephanie Rapp, director of market relationships at Equinix Inc. (Nasdaq: EQIX), which provides outsourced data centers along with its other services. (See Equinix Nabs New LA Data Center.) As a result, she says, companies must often use up more space just to accommodate their power needs.

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