Europe’s Trading Superhighway in the Alps Highlights Data Rush

There are bomb-proof buildings and security passes. Data centers are a booming industry that is hosting more of the world's money, entertainment and energy use than ever.

One of Europe's newest data hubs is located in the foothills of the Italian Alps and has become a cornerstone of the economy.

Within the building's 800-kilometer network of cables, banks shoot trading data at one another's server within 20 microseconds, or millionths of a second.

People used to buy and sell in that room. The chief operating officer of Euronext said in an interview that it is now a noisy room with server. It's important that speed matters.

Stephane Boujnah, Euronext's chief executive officer, said that the data center handles an average of 13 billion euros a day. The trades took place in an equally imposing warehouse a few miles east of London before the UK voted to leave the EU. The operation was shifted to Italy over a year ago.

An hour from Milan is where the new site is located. The chances of someone passing through a building like this are very high. Something happens in a data center when something happens on the cloud.

According to research by the law firm, investments in the industry doubled to $59.5 billion in 2021. By June 7, this year's investment had doubled the record set last year. Businesses that supply equipment to data centers are being fired up by this demand.

Dalmar Sheikh is the director and global head of data center operations at Actis. There are data centers in Nigeria, China, and South Korea.

If a finance company can rent a spot in a data center close to its market counterparties, it will be more likely to use data centers. Firms that need a lot of computing power can take advantage of the data center's flexibility.

It isn't for everyone to trade in data centers. Chris Jackson is the head of equities for Europe at Liquidnet Europe, which operates dark pools where firms can trade more slowly and quietly.

Jackson said that it has created a hostile market for legitimate investors.

Even for tasks that tolerate slower processing times, data centers offer modern kit that allows them to take care of their own maintenance and security concerns.

Power Struggles

These matters need to be managed in the real world. The Netherlands imposed a nine-month block on permits for sites larger than 10 hectares because of growing concerns about energy usage in data centers.

It is thought that centralized data centers are safer against cyber security incidents since they are protected by a single company. I wouldn't use the word'safe'. Beatriz Sanz Saiz said nothing in this world is safe.

The relocation of Euronext's hub to Italy was partly due to the decision to leave the European Union.

All data centers in the EU were supposed to have their core infrastructure in Europe. We didn't know what the direction of travel was in the UK and didn't want to take any regulatory risks

The New York Stock Exchange is owned by Intercontinental Exchange Inc. It is a mostly windowless building in a maze of industrial parks near bathroom showrooms, tractor dealerships and small time law firms.

ICE has a data center that is four times the size of a soccer field. Banks trade fixed-income derivatives such as gilts and Euribor futures inside, with hundreds of fiber-optic cables running west to London, south to Europe, and under the Atlantic to New York.

Premium access to the trading engine and the data that is published locally is what people who want to live in Basildon want.

There are plans for a data center blackout in the United Kingdom.

Failure Scenarios

A short distance from the O2 arena in the Docklands area of east London, Telehouse has vibration wire around the site that alert security staff to anyone entering the building. Some parts of the building are bomb-proof and the firm works closely with police and counter- terrorism officials. The goal is to protect the data of clients such as Amazon.com Inc.

Paul Lewis is the senior operations director at Telehouse Europe. There are a lot of checks and balances and we don't want people to come in who shouldn't be here.

A space similar to a gym locker is rented by clients. The activity in these lockers can cause the center's temperature to go up to 40 degrees Celsius. The building has enough fuel and backup generators to keep it running for 36 hours.

Telehouse already operates five data centers in London and is planning to build a sixth, which will cost hundreds of millions of dollars.

Green Cost

The environmental impact of the industry is a big concern. In Ireland, the use of energy in these buildings has more than tripled since 2015. It is projected to triple to 7% in the country by the year 25.

Water is drawn from a nearby fjord to cool a data center in Norway. Mette Gulbrandsen, marketing manager, said that it was going to take the newly heated water and put it into a lobster farm.

Euronext might have a solution. The firm's hydroelectricity and solar panels can be found on the Brembo river.

Data centers are the biggest problem when it comes to reducing carbon footprint in the digital economy. Our carbon footprint is not harmful to the environment.

The future of data centers is evolving. According to Sanz Saiz, the role will be performed by cloud server powered by renewable energy within the next 10 years. She said that the data we are using is a fraction of what will be used in the future. All of the data centers that we know about will be gone.