Facebook announced Monday it would break ground this summer on its Iowa data center.
Data centers in Iowa are dominating headlines this week as Facebook on Monday announced its intention to build a facility in Altoona and the next day the State of Iowa revealed Google is expanding its existing project in Council Bluffs. The immediate costs of these two projects is expected to reach nearly $700 million, creating hundreds of construction jobs but likely just 31 new jobs between the two data centers.
Here's an overview of the Iowa data center news from the two California-based tech giants:
Facebook Fast Facts
- The news: Facebook announced it will begin construction this summer in Altoona, Iowa on a 476,000-square foot data center that promises to be among the most advanced and energy efficient of its kind. The company's 194-acre site could accommodate up to two additional data center buildings that may be constructed in future phases of the project. The Des Moines Register spoke with experts that believe the amount of investment could reach $1.5 billion. This is Facebook's fourth owned and operated data center—the others are in Prineville, Ore.; Forest City, N.C.; and Luleå, Sweden.
- Cost: Facebook will invest a minimum of $299.5 million in the project.
- Job creation: Facebook is expected to create at least 31 new jobs at a qualifying wage of $23.12 per hour. The project also is expected to create hundreds of construction jobs.
- Incentives: The Iowa Economic Development Authority board approved $18 million in tax benefits through its High Quality Jobs program. The City of Altoona will exempt local property taxes for the site for 20 years. The city also has in place a special discounted water rate for businesses that use more than 9 million gallon a month. After 9 million gallons, the business would get a $3 rebate per thousand gallons.
- Sources: "Facebook chooses Iowa for next data center location" - Office of the Governor of Iowa; "A New Data Center for Iowa" - Facebook; "Update: Facebook investment expected to grow, state leaders say" - Des Moines Register; "Altoona approves new Facebook data center" - Des Moines Business Record
“One of the biggest problems we have here is there are not a lot of big technology companies, other than sales offices,” said Christian Renaud, a mentor at StartupCity Des Moines. “This is going to make it better for the tech community in terms of exits,” such as potential acquisitions of small companies.
Kearney Mayor Stan Clouse said Monday that even if Iowa was chosen over his central Nebraska city, competing for such a huge data center was a good experience and an honor for the community. Kearney's proposed site, near its airport, eventually will attract a data center, Clouse said.
The social networking giant's goal is to obtain 25 percent of the power for its data centers from renewable sources, like wind, by 2015. And Iowa has it, ranking No. 3 nationally last year in the generation of wind energy, according to the American Wind Energy Association. Nebraska was No. 26.
(Altoona city administrator Jeff) Mark said the company officials also were very concerned about weather and a big draw was the fact that a tornado has never touched down in Altoona.
In Prineville, Ore., where Facebook is building its second 300,000-square-foot data center, City Manager Steven Forrester said the company has helped transform the small town.
Google Fast Facts
- The news: Google is going to increase the investment of its previous data center project in Council Bluffs, Iowa by $400 million, bringing its total spent in the area to $1.5 billion. The data center houses computer systems and associated components that support services such as Google Search, Gmail, Google Maps and Google+.
- Cost: Goolge will invest $400 million to expand its data center in Council Bluffs, Iowa.
- Job creation: Google is not pledging any additional new jobs, according to the Omaha World-Herald.
- Incentives: The Iowa Economic Development Authority board approved an amendment request from Google, Inc., to increase the project budget of its April 2012 High Quality Jobs award. Additional tax benefits in the maximum amount of $7.2 million were awarded in the form of a refund of sales and use taxes paid during construction.
- Sources: "Board Action: Economic Development Board Approves Financial Assistance" - Iowa Economic Development Authority; "Google Pumps $400 Million More into Iowa, Investment Now Tops $1.5 Billion" - Data Center Knowledge; "Tax breaks OK'd for Facebook, Google in Iowa" - Omaha World-Herald
Google spent $600 million to build the initial phase of capacity in Council Bluffs, followed by phased expansion investments of $300 million, $200 million and now an additional $400 million. Total: $1.5 billion. Let that sink in.
So as Facebook pushes Google, perhaps Google is now pushing back a bit today with its own Iowa news. Google's is a bigger project announcement, coming the same day after Facebook’s might just be a coincidence enabled by incentive packages, or it might be an attempt to steal Facebook’s thunder.