Crime Adds to Data Center Supply Chain Woes

Thieves Pivot to a Lucrative Target

Many Philadelphia-area leading enterprises have legacy data centers that are past their prime and are considering what to do next.   While data center ownership was a clear-cut decision during the early shift to a digital economy, there are now many more choices in addition to building a data center today.  Meanwhile, data center construction continues to get more complicated, and a big part of that is simply the sourcing of the materials needed to build and equip a data center. 

Supply Chain Woes: With hyperscale cloud providers getting nearly all of the focus from data center power manufacturers, the data center supply chain is a struggle right now.  Items that previously took months to source, like switchgear, generators, and other necessary equipment are now facing waits of at least a year, and sometimes two if transformers are involved.   And now there’s a growing issue adding further complications.

Where Money Is, Crime Follows: Bad actors have noticed the data center boom, the supply chain crisis, and see dollar signs.   Multiple thefts of data center materials have occurred recently.  While some are simply opportunistic robberies for quick metals recycling but increasingly they are complex, like the $1.3 million theft of (fortunately recovered) data center gear in Chicago reported in early July.  The trailers found in Chicago had been stolen in separate instances in Alabama and Florida, indicating a level of sophistication and organization.  Industry scuttlebutt is that some of thefts are being handled quietly, as the hyperscale cloud providers don’t want to give nefarious players any ideas, nor do they want to look like they can’t execute on their timelines.  

Not the First Time: Recent robberies are hardly the first time data center infrastructure has been compromised, and an opportunistic Digital Realty Trust employee made off with nearly $2 million in equipment last year in an inside job.  But while historically these thefts were more likely for the data contained on servers, the pivot to pricey equipment makes sense due to the skyrocketing costs of data center technologies in the AI age.   

Thefts a Small Part of Larger Supply Chain Issues: The recent thefts of data center equipment are interesting, and are definitely a growing trend, but are unlikely to impact you directly.  The biggest issue in trying to source data center infrastructure is simple supply and demand. 

With manufacturers understandably focused on their biggest customers a small to midsize data center build in Eastern Pennsylvania will not be at the top of any manufacturers’ list of priorities.   It just makes business sense for them to focus on the web giants building massive AI data centers giving them repeat business all over the country. Meanwhile, the construction timeline of a single data center build for an Eastern Pennsylvania enterprise is likely to be way down their list of priorities.     

Supply Chain and Your Aging Data Center: The supply chain is just one challenge to consider if your organization is evaluating a rebuild of a legacy data center. As you evaluate the strengths and weaknesses of the various strategies under consideration a new Direct LTx white paper may be of interest to you.

It is entitled Replacing Your Aging Data Center?  Reviewing the Options and Strategies Available to You, and the title gives you a good idea as to what it is all about.  Click here to read it or reach out to us for a copy at strategy@DirectLTx.com.