Microsoft To Spend $1 Billion On Datacenters In North Carolina

Microsoft is building four datacenters in North Carolina as part of a phased development that will see it invest at least $1 billion over the next decade. The Register reports: The datacenter expansion will see Microsoft construct the facilities at sites in Conover, Maiden and two at Hickory in Catawba County, creating at least 50 new jobs, according to the Catawba County Economic Development Corporation. Economic development agreements and incentive grants for the project were approved at a joint meeting this week by the Catawba County Board of Commissioners along with the elected councils of Conover, Hickory and Maiden.

The terms of the agreement include a guaranteed minimum investment over 10 years in Catawba County from Microsoft of $1 billion, with each municipality getting $332 million, with an additional $33 million to Hickory for its second site. Microsoft will get performance-based incentive grants of 50 percent real property value and 85 percent personal property value, to be awarded over ten years. This means that over that period, the local government bodies will essentially pay back that proportion of Microsoft's property taxes, according to reports in local media The Charlotte Observer.

Microsoft did not state what capacity the new datacenters will have once built, but they are set to take up a combined 687 acres of land between them. The expansion is likely to be additional capacity for Microsoft Azure cloud. Currently, Microsoft already operates more than 200 datacenters globally. Last year, Microsoft said it planned to build new facilities in at least 10 more countries, and that it aimed to construct between 50 and 100 new datacenters each year for the foreseeable future.

Why?

[fuzzyfuzzyfungus]

There's nothing outright wrong with a datacenter(at least if you've got the power and water for it; and insist on things like adherence to noise ordinances so that they can't set up giant howling cooling fans right on the property line and tell everyone who can't sleep anymore to suck it up and like it); but what about one is so attractive that you'd offer such a sweetheart deal?

"Microsoft will get performance-based incentive grants of 50 percent real property value and 85 percent personal property value, to be awarded over ten years. This means that over that period, the local government bodies will essentially pay back that proportion of Microsoft's property taxes"

Given that a datacenter is basically a server warehouse with power and cooling needs, very lightly staffed(and mostly by comparatively low skill/non 'tech' roles, HVAC and electrical on the high end, some security guards and general custodian/handiman postings; maybe a few lightweight screwdriver monkeys if the econonomics indicate that some amount of local FRU swapping makes sense); if you are refunding massive chunks of property tax you are giving back more or less the only thing you were going to get out of the arrangement, aside from (potentially, if they don't just bring in their preferred outside experts) during the building phase.

My experience has been that even noob-tier small business/branch office/comparatively under-resourced K-12 education scenarios don't actually require that many man hours per server per year; and that's with effectively zero expertise in provisioning or orchestration, some hardware that doesn't even have a BMC that provides a network-accessible console, and small enough systems that most of the servers are lovingly maintained pets rather than expendable bulk livestock. Slightly further up the food chain, in medium business land, going more than a year without someone poking their head into the colo is unexceptional; and the hyperscaler guys are on the bleeding edge of hands-off management. There's just not going to be anything going on once they get the place up and going.

Re:

[Tontoman]

Maybe some payola taking place?

Re:Why?

[ShanghaiBill]

Humidity, rednecks, christians who do the exact opposite of christ, racism, no abortion rights

The data center will be built in the mountains of western NC, which have a pleasant climate. It is about an hour from Charlotte.

Abortion is legal in NC.

Re:Why?

[CaptQuark]

All four locations are about 45 miles northwest of Charlotte, NC, one of the little-known tech centers in the south. Charlotte was recently ranked the No. 1 tech town in America by CompTIA.

If the nearby population is tech savvy, land prices are cheap, power is cheap, and the local municipalities are willing to give Microsoft favorable tax breaks, it would seem a tempting place to build at least some of the 50+ new data centers they plan to build each year.

https://www.zdnet.com/educatio... [zdnet.com]

Re:

[93 Escort Wagon]

Given how this has played out elsewhere, I'm sure that some Microsoft flunky convinced the powers-that-be that this data center would somehow serve as an anchor that would subsequently attract many more high-tech businesses - which in turn will, eventually, employ many more people.

Re:Why?

[timeOday]

I suppose that for the very reason you said (lightly staffed), datacenters don't draw much on the municipal services that are funded by property taxes. How many police and EMT callouts can a datacenter possibly get in a year compared to an apartment complex?

Re:

[jeff4747]

This is a very lightly-populated area with very little economic opportunity, but not that far from a major city.

In other words, there was nothing going on in those 687 acres, or the 1000 surrounding them. So the land is cheap, the small number of workers are cheap, and the photons don't have to travel very far to reach it from Charlotte.

Re:

[macnotabot]

I'm not sure I'd call Hickory a major city; at 40,000 population it's relatively small sized. Of course, it's the biggest city for 30 minutes to an hour in all directions, so that makes it seem bigger? The other surrounding towns for these data centers are much smaller. Maiden is the smallest with a population of 3300. Startown, an unincorporated community located close to Maiden and bordering the Apple data center and solar farm, has a population of around 27,000 according to Kahier [link -> https://www [kashier.co]

Datacenters

[MrL0G1C]

And how many of these thousands of data centers by various companies worldwide are the result of spying on consumers web habits and phone habits, internet-of-things etc data?

MS is known to hoover up tons of meta-data from every MS using PC in the world, there own privacy info admits it.

It all looks like to me that corporations have too much money to fritter away on gargantuan amounts of computing resources just so as they can get an extra percent profit out of selling data to advertisers. The same is true for hedge funds / private city investors, they'll waste billions on new data centers if they think it means they can squeeze a percentage more out of the money they borrowed at low rates (at least that's changing).

To me this is one of capitalisms hidden failures, a sad waste of money and resources and a good reason to heavily regulate and restrict data being used by 'data-mining' and advertising.

Financial Simpletons

[Canberra1]

There is a thing called inflation and compound interest. And for land, things double in price every 7 years, even in unattractive locations. So for each present day dollar, the counties will get back a discounted cash stream. Many homeowners in those counties would jump at the deal to pay their taxes in advance (same deal as MS). On top of that MS gets fat depreciation off .fedgov. There is also the opportunity cost - a timber or trucking firm would hire MORE people per unit of land. As pointed out, these are not high paying jobs.

Re:

[packrat0x]

For reference Catawba, NC is about 42mi NNW of Charlotte.

And for land, things double in price every 7 years, even in unattractive locations.

*REALLY?*

Have you checked out Laurinburg, NC It's about 92mi ESE of Charlotte.
Prices have been going down for the last 30 years.
Same thing with parts of West Virginia.

Re:

[ArchieBunker]

Land decreasing in value? That’s almost unheard of. Something has to be seriously wrong with these places to be the exception.

Re:

[nevermindme]

Tou have to get out more and see why west Virginia still has a reputation. Vacation house property on tobacco road does not sell without 5G cell coverage, high speed internet and starbucks within 15 minutes. All those things come to rural America, it just comes last to rural WV.