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Top 10 Challenges: iMasons Member Summit in Singapore

The need to attract, train, and retain talent across the digital infrastructure industry was top of mind for members of iMasons Global and APAC Advisory Councils when they met in conjunction with Data Center World Asia in Singapore on October 10 and 11, 2023. The skills gap reverberated across other top-of-mind challenges including grid power availability, supply chain degradation, access to capital, and cooling requirements for AI workloads. We asked these leaders to rank and discuss their top challenges in small groups and summarize them in a readout. Here are the top 10. 

1. Talent 

Attracting, training, and retaining talent is an ongoing and relentless struggle in our young and fast-growing industry. People experienced with advanced technologies specific to the data centers such as AI workloads are needed, as are people experienced with high voltage equipment. There’s also demand for people experienced in finance, who have a network of industry professionals, and engineers of all stripes, from electrical and mechanical to network, operations, and facility. One member noted there are more than 100,000 job openings in the industry today. 

2. Power Availability

Data centers consume power. A lot of it. Access to power determines where data centers are located and shapes the growth of the power grid. iMasons members support green power and yet struggle to access it in a timely, predictable, and reliable way. They worry about competition, capacity constraints, shortages, and the implications of geopolitical tensions on supply. In China, a member noted, there’s an excess of power supply but it’s built in the wrong part of the country. Another member sees room for improvement in power use efficiency (PUE). A new metric for our industry, power capacity efficiency (PCE), which is a measure of how much capacity a data center has versus how much of that capacity it uses, also gained traction in discussion as an area for improvement.

3. Supply Chain

While COVID-related supply chain challenges are largely resolved, explosive growth throughout the digital infrastructure industry is creating a new class of supply chain issues and stresses. Competition for parts is sending prices higher and yet some members noted component quality is degrading. Others lamented the lack of standardization and consistency among and between vendors. Access to state-of-the-art equipment is a challenge in certain Southeast Asian markets. 

4. Growth 

The digital infrastructure industry is growing at an accelerated rate. Technology is changing fast, too. Greater demand for AI is creating new challenges around cooling requirements and rack density. Data center developers fear they will build for today’s market only to learn their customers require something entirely different. One read out suggested the speed of the industry’s growth is the number one driver of pressures across the industry, from the talent shortage and power constraints to supply chain degradation. Many members said the pace of AI-driven growth is unsustainable.

5. Access to Capital 

As one reader noted, money isn’t free anymore, the debt market is choppy, and yet our industry is taking on ever bigger projects that require raising ever more capital. This capital, in turn, must fund digital infrastructure that’s future proof – able to handle the needs of today’s cloud and an unknown AI future that’s lurking around the corner. Members also expressed concerns about rising building costs, inflation pressures, an uncertain interest rate environment, and the reality that growing capex translates to decreasing returns.

6. Public Perception and Regulations 

The digital infrastructure industry is under increasing regulatory pressures ranging from sustainability reporting requirements to power, water, and land permitting. Along with the regulatory pressure is increased scrutiny from the communities where digital infrastructure is built. This scrutiny is increasing as data centers get bigger, consume more power and water, and encroach on residential neighborhoods. More voices are being heard that people want access to AI and other digital technologies, but they don’t want a data center in their backyard. Communites’ concerns over the impact of data centers in their midst questions the industry’s social license to operate and exposes a challenge of public perception.

7. Cooling and Obsolescence 

The accelerated growth of AI across the digital infrastructure industry is raising new concerns about cooling requirements for these high-density workloads. Liquid cooling is gaining momentum as a viable option, but questions abound about the technology and approaches. Direct-to-chip or immersion? Single phase or two phase? Much of the information on liquid cooling is proprietary, and some data center developers feel lost. What’s known is that the high-density workloads of AI are forcing data center builders to rethink cooling requirements. 

8. Land and Water 

Access to land with available power and water to build digital infrastructure is a rising concern for many iMasons members. Lack of space to build new data centers threatens to slow growth. Several members noted that constraints on power and water compound the land access issue. While power capacity is top of mind for many iMasons members, water availability and management are a rising concern. One read out noted that drought in Taiwan and parts of Central Asia are growing stressors on the industry’s growth in these regions. 

9. Decarbonization & Meeting Sustainability Goals 

Decarbonization is the overarching sustainability challenge facing the digital infrastructure industry, according to one read out. This challenge is most acute for scope 3 emissions reporting. Scope 3 emissions are those not produced by the company itself, but those that a company is indirectly responsible for throughout its supply chain. That’s typically where the challenge of decarbonization lies for materials such as concrete and steel, and capital equipment like servers, generators and chillers, which are critical to digital infrastructure and are also among the most challenging materials and components to decarbonize. The inability to decarbonize is a challenge for many iMasons members striving to hit 2030 sustainability targets.

10. AI 

Concerns and challenges associated with AI echoed throughout discussions about every top-of-mind issue and challenge facing the digital infrastructure industry. AI requires talent, power, cooling, capital and chips. It’s the number one driver of industry growth. Meeting the demand for AI ties into regulatory pressures, land issues, and decarbonization. Yet, iMasons members understand that they are the enablers of AI and want to enable it for all. 

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