COVID-19 is a black swan-type of a challenge that businesses could not have anticipated. Mass shutdowns and the consequences of the economic crisis that is linked to the epidemics affect businesses in all industries. Small businesses and the companies that work in tourism and entertainment are affected more severely, but the tech also experiences negative consequences of the epidemics. It may seem that data centers should strive on the growing demand for data, but COVID-19 creates unique issues that are actually quite difficult to overcome. On the one hand, data hubs have to increase their capacity in the face of the data surge. On the other hand, they have to deal with customers that lose their ability to pay for storage. Naturally, data centers have to elevate their safety practices to prevent the employees from getting infected because they work in actual danger. 

The Data Surge Challenge

The demand for data in times of epidemics is growing at a fast pace. Data centers face the need to expand the bandwidth on their networks. Across the world, companies such as Microsoft Azure report a massive surge in its cloud service. In March, OpenVault stated that broadband consumption during business hours saw a 41 percent increase. In particular, Akamai reported that data traffic in China, Japan, Korea, and Italy surged 30 percent compared to the rest of the world. With more countries becoming the epicenter of epidemics, the demand for data continues to increase. For this reason, data centers have to work on adding capacity in a short time. As of now, companies are handling increased traffic quite well. To accelerate their capacity, some companies have to develop new locations.

Issues with Construction and Business Deals

However, developing locations might lead to additional issues. COVID-19 epidemics interfere with essential construction for data centers because of possible bans on building projects. This is dangerous for data hubs that are currently working on installs to improve capacity that is essential to sustain surges in data. Even the construction work that is allowed may close in case personnel develop flu-like symptoms. For instance, Facebook had to stop work in Clonee, Ireland, after this happened to one of the workers. The company also postponed a large construction project in Huntsville, Alabama. On top of that, the epidemic interrupts planned business deals, such as acquisitions and joint ventures. The reason for this is that travel is required for due diligence. Traveling restrictions are a burden for business progression. There are two essential risks that come as a result of construction postponing. First, businesses risk not adding capacities that they need right now to survive the surge of data. Second, they lose profits because they have to stop long-term planned projects.

Customers in Trouble

While data centers of tech giants are likely to survive all challenges, smaller centers are at increased risk of going bankrupt. Many data centers rely on small and medium-scale businesses that constitute the most substantial part of their customer pool. The purchasing power of these customers is likely to decrease radically, and some of them might default. Data centers might have to lower prices for data storage to keep their customers throughout the 2020 financial crisis or allow the businesses to delay the payment for several months in a row. Still, some customers will have no choice but to leave even if the data company does everything to keep them. 

Safety First

Data hubs have to work hard to implement safety measures, which is the highest priority right now. The nonessential staff works work from home, and the access to facilities in the largest data centers is heavily restricted. Some companies see this as a great challenge because they struggle to establish secure access to corporate networks for those working from home. Determining which workers are essential can also be a severe challenge for companies, as they do not have a roadmap on how to act in such situations.

Data centers have to follow strict rules to continue working. To prevent mass shutdowns, some of the data centers had to complete mass disinfections after having coronavirus-positive visitors. Cleanings are implemented according to the protocols developed by the Centers for Disease Control and Prevention or any public health guidelines that are relevant in the United States at the moment. Critical sanitary measures are now a part of every data center protocol. Only symptom-free workers who have not been in a confirmed direct contact with coronavirus patients have access to the datacenter facilities. Most companies have their customers undergo temperature screenings on top of that.

What Can Data Companies Do?

With the United States currently on the verge of pandemics, it makes sense to look at the pandemic-related experience of data centers In China, the first country to face COVID-19-induced crisis. There, the companies were fast to respond to a growing demand for data. Currently, cloud providers give companies and government organizations free resources. Moreover, they accelerate the data of the research institutions and provide access to it in order to discover the treatment for the coronavirus. Some cloud companies, such as Alibaba, offer their services to doctors and medical organizations all across the world without paying. Some analysts suggest that the companies that are willing to support their customers in times of crisis will be the ones to sustain it the best. 

Chinese cloud companies and data centers are not alone in their attempts to tackle the crisis, as data hubs all over the world offer incentives to its workers in times of a major crisis. Some data companies provide educational and cultural organizations, as well as university and college students, free access to their services throughout the entire duration of a crisis. Tech giants like Google and Microsoft support the initiatives that offer free access to data in order to fight the COVID-19 crisis. Hewlett-Packard has donated 2 billion dollars to support its customer businesses throughout the crisis.

An Uncertain Future

The long-term impact of the COVID-19 epidemics on the future of data centers is hard to predict. In particular, making predictions is hard because it is not clear when the current crisis is likely to end. It is possible for restrictions to last for at least 18 months before the vaccine is developed. Datacenter businesses will face additional challenges if the large-scale projects are postponed to a date later than 2021. However, the businesses currently prefer to take it one step at a time, as long-term planning is not that effective in the face of uncertainty.

Some changes can turn out to be positive. For instance, data hubs will likely keep critical appliances in their storage to prevent logistics crises. Moreover, data centers will develop strategies on how to mobilize staff in events like COVID-19. Naturally, organizing remote work will no longer be a challenge as long as current strategies succeed. With optimism, it is possible to predict that major data centers will likely overcome the crisis.

Next time, we'll discuss Alibaba, one of the most effective respondents to COVID-19 challenges, and access its unique role in the Chinese data market.