Chindata Group: Bridging the digital divide
Chindata Group has had a meteoric rise since the company was founded in 2015. Jason Mcgee-Abe heard from Alex Ju, founder and chief executive officer, about His hyperscale journey and the industry in the midst of a digital evolution.
In a world when global digitisation is surging, the performance of data in all its forms is more critical today than ever. The next-generation of hyperscale data centre infrastructure is becoming the bedrock to help support this evident trend with new generation applications, data processing, interactions and technology.
Zhangjiakou-founded Chindata Group, which won the Hyperscale Innovation accolade at the 2019 DataCloud Awards, has rapidly built a cluster of campus-style hyperscale facilities to internet, cloud and technology companies. The carrier-neutral IT infrastructure solutions provider’s ecosystem is seen as a pioneering engine for the development of renewal energy and the green economy.
Ju, who had previously founded Chindata Industries in 2005, stresses the importance of next-generation hyperscale data centre infrastructure has to play to ensure continuity of service and keeping our world connected. So how does he believe the data centre space is evolving?
“Facilities are only going to get larger in the future, while the size of a single edge computing data centres will become smaller and smaller,” he responds. “In order to cope with surging demand, internet and cloud computing companies are not only hoping facilities have faster transmissions and lower latency but that they can store larger amounts of data for real-time computing requests. At the same time, they’re seeking this but with lower costs and shorter delivery times.”
All this calls for a new model of data centre structure and deployment, says Ju, “where onshore and offshore data will be stored around the core city and nearer to the internet user”. He adds that data is being deployed in a hybrid way to meet the needs of internet companies to calculate massive amounts of data in real time.
Referencing one Chindata Group customer, the CEO says they requested to reserve even more data storage capacity for the next six months to cope with its rapidly increasing user demand, and we finally meet their elastic needs very well. “However, a traditional model of data centre structure and deployment cannot meet such a large-scale expansion demand in such a short period of time. Even if any could, the cost would be extremely high,” Ju explains.
“The next-generation hyperscale data centres adopted by Chindata Group can provide customers with faster delivery, lower cost, and higher performance data centre solutions.”
Data Economy Capacity
The largest part of a data centre’s cost is power. Chindata Group has proactively entered the field of renewable energy development not just to obtain low-cost power but to promote the renewable energy agenda for the industry. Ju says the company is making full use of the existing “wasted wind and electricity” generated by green energy farms and is developing more wind and solar resources to continuously reduce the cost of electricity.
“Orderly planning and uniformly deploying hyperscale data centres in strategic areas will definitely give rise to a scale effect, which will lower the cost of key industrial factors such as land, energy, and network,” Ju states.
“Furthermore, in our data centres, components whether as small as equipment, or as large as computer rooms, buildings, and even the entire campus, are all modularly prefabricated. The advantage of this is that it can speed up the construction speed.” He adds that this can be quickly replicated in other batches in different regions.
“This can meet the needs of our customers to expand capacity in the same campus due to business expansion, or to build multiple campuses in one region. We can even export the buildings overseas in containers, minimise uncontrollable factors that affect the construction speed of the project, and help customers expand their footprint to other countries quickly,” he explains.
This explains why a number of international technology giants have chosen Chindata Group as its ideal partner when they are laying out their plans for Asia-Pacific emerging markets with the greatest growth potential. Chindata Group, which simultaneously covers the Chinese, Indian and Southeast Asian markets, has achieved shorter provisioning times, lower costs, enhanced its scalability and operating efficiency.
India & Southeast Asia
China’s development is widely known, but I ask what Ju’s thoughts are about growth and potential of markets such as India and the Southeast Asia region.
“Yes, this is beyond doubt. In recent years, many technology giants have focused their business expansion on Asia-Pacific. Streaming media companies have entered thousands of households in South and Southeast Asia, e-commerce has flourished in India and Malaysia, while online education and artificial intelligence has given rise to many unicorn companies,” Ju says.
Asia-Pacific emerging market economies have seen a huge increase in digital demand.
Countries such as Indonesia, India, and Malaysia are aware of the increase in digital demand but are also concerned about the weakness of their respective digital infrastructure. For example, Indonesia has quickly legislated for international cloud giants to support them in building data centres locally and India also passed legislation in 2019 to encourage the localisation of data centres.
Ju highlights: “Data from an authoritative report forecasts India’s CAGR for hyperscale data centre market size will reach 21.6% from 2019 to 2024 and the total megawatts of 2024 is 3.39 times higher than that of 2019.”
From a macro point of view, India and Southeast Asian countries have nearly 1.8 billion people, and the proportion of young and millennial generations is very high, which means that the digital divide in these regions will have a large growth curve. “You see, twenty years ago, China’s digital economy was still barren. After years of solid digital development, most people know about Alibaba, Tencent and Bytedance. I believe that it is the same in South Asia and Southeast Asia. In the future, the global technology giants and unicorn companies will be able to find the next opportunity for rapid growth here, and local world-class technology giants and unicorn companies will also shoot up,” he predicts.
Chindata Group is like a bridge in this sense. “We have “Chindata” and “Bridge”, two sub-brands, focusing on the Chinese market and the emerging economies
of South Asia and Southeast Asia respectively, allowing global digital leaders developing in Asia-Pacific emerging markets and unicorns that have huge potential for development,” Ju adds.
The development of hyperscale data centres is still decentralised and independent. Consequently, the benefits of data centres, such as renewable energy, community development supporting utility and communication networks,
is restricted in Ju’s opinion. “The full advantages hyperscale data centres bring to local employment and taxes have not been obvious,” says Ju.
However, during the development of the Chindata Group, he proposed a “next-generation hyperscale data centre”, which could be condensed as “centralised, standardised and modularised”:
- Centralisation refers to, during the planning and selection phase, high-performance data centres with deployment of both onshore and offshore infrastructure in a defined location, leveraging flexible network architecture and new technologies to accommodate at least 300,000 units of high-performance IT hardware facilities, and to secure in advance a site which can support the expansion to at least 100MW of capacity;
- Standardisation refers to, during the resource development phase, the development of a unified and standardised infrastructure based on the characteristics of strategic locations, including, but not limited to, land availability, road network, energy supply, power distribution network, communication network, building infrastructure, and associated public facilities;
- Modularisation refers to, during the construction phase, the implementation of the full modularisation process, which evolves from equipment to a facility, from server rooms to data centeres,
and finally completes the delivery of hyperscale data center campus based on full modularisation.
The Chindata Group, based on Ju’s philosophy, has quickly emerged as a company the industry has not really seen before. This has led to faster delivery, lower costs, higher performance and more scalability while meeting the digital needs and iterative potential of global industry leaders.
So what is the core value of Chindata Group’s philosophy? “My lifelong wish to provide customers and their end users with products that exceed expectations and allow more people to use cheaper but better digital services,” he states. “This requires full consideration of key elements such as energy, land, and network at the beginning of building a data center. Suppose on a ten-year life cycle, nearly half of all data centre costs come from electricity. The use of renewable energy is currently recognised as the best solution. It has low cost and abundant resources. It provides reserve energy for the expansion of the data centre. Therefore, one of our principles is to choose the construction of a data centre in a region rich in renewable energy.”
Second, as Ju refers to earlier, the centralised deployment of hyperscale data centres in a region is an upcoming trend. “This requires a large amount of land reserve resources, not only to provide reserves for data center land, but also to provide upfront land resources for unified and standardised renewable energy power plants, power generation and transmission networks, communication pipelines, and municipal supporting facilities such as water plants,” he says. On top of abundant energy and land resources, he also stresses the need to be as close as possible to the area where internet users gather to ensure low latency and improve the end user experience.
With regards to this, he summarises that Chindata Group has the “three flows in one” next-generation hyperscale data centre location strategy. This is that the “energy flow”, “information flow” and “business flow” all meet the construction conditions of the data centre, namely, energy-rich, network convenient and close to users.
As energy consumption increases, data centre providers must incorporate sustainability as a key component of their strategy to stay ahead and be more responsible. Being part of a high-capacity energy industry, I ask Ju what his philosophy is on the future of green and sustainable data centres.
“From the perspective of our customers and their end users, I hope that the cost of energy will be as low as possible, and the profits from the falling costs should be rendered to my customers,” he responds. “From the perspective of the whole society, I am a zero-carbonist, and I hope that the data centres I build will have minimal environmental impacts.”
He explains that this philosophy stemmed from the first day he stepped into the data centre industry and clearly saw the industry is high energy consuming and, ever since, has been exploring the best solutions for data centre energy supply.
“I think the concerted development of the “renewable energy and data centre” that we propose now can not only make the development of the data centre sustainable, but also make our earth home a better place,” Ju states.
The specific method he says that will work is to build our own renewable energy power plant and distribution station in the area where the data centre cluster is located, and directly convert the local rich wind and solar resources into wind power and photovoltaics for the operation of our data centre.
“This approach has many benefits: it can save a lot of distribution network construction costs caused by traditional long-distance transmission of distribution networks, avoid power losses caused by long distances, and obtain lower power generation costs,” Ju exemplifies.
“Even for a data centre located in a cold area in the north, the supporting energy supply is like a super battery, which provides energy for the large amount of cooling required by the data centre in spring and summer. When it comes to autumn and winter, the cold climate provides a natural cold source for the data centre, and the superfluous power resources can provide clean heating energy for each household.”
The company’s regional energy use, sustainability, and community development agenda makes it stand out amongst its peers. At the start of the year, Greenpeace released its first renewable energy ranking of China’s cloud and data centre giants, which ranked Chindata Group first with a score of 80 out of 100. Last year, Chindata Group outlined a very big ambition, setting a long-standing sustainability goal of 100% adopting renewable energy for its hyperscale data center clusters.
In 2019, its Taihang Mountain Energy and Information Technology Industrial Campus in Datong, Shanxi, is being constructed as China’s first 100% renewable energy supply information industrial campus. Capacity asked how this goal is progressing.
On The Horizon
“This year, we will inaugurate many projects in Pan-Beijing Area and invest in construction,” he says. “We will continue to improve our next-generation hyperscale data centre industrial cluster, and truly turn this global data centre location into a global digital infrastructure gathering center.”
Similarly, Ju further reaffirms the opportunity of developing the next-generation of hyperscale data centres
in emerging markets in South Asia and Southeast Asia. “We firmly believe that through our efforts, Chindata Group can quickly integrate into the digital wave of emerging market countries and become a beneficiary of the pan-
Asia-Pacific emerging market digital platform. At the same time, we can enable these countries to quickly upgrade digital infrastructure, with high quality, and low cost, and finally bridge the digital development gap between economies.”
From the perspective of the whole society, the concept of “digital divide” was proposed in 1999, Ju says. “After more than 20 years, although governments, enterprises, and individuals are making various attempts to bridge the digital divide, we have to admit that this divide still exists, and that the endless new technologies actually make this divide even deeper.”
“I hope that our data centres will not only meet the needs of our direct customers, but also meet the ICT needs of the entire society.”