UII UPDATE 181 | Q1 2023
Intelligence Update

Data center costs set to rise and rise

Up until two years ago, the cost of building and operating data centers had been falling reasonably steeply. Improving technology, greater production volumes as the industry expanded and consolidated, large-scale builds, prefabricated and modular construction techniques, stable energy prices and the low costs of capital have all played a part. While labor costs have risen during this time, better management, processes and automation have helped to prevent spiraling wage bills.

The past two years, however, have seen these trends come to a halt. Ongoing supply chain issues and rising labor, energy and capital costs all set to make building and running data centers more expensive in 2023 and beyond.

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