Silicon Valley is not a Good Location for Data Center Colocation

Why would anyone in there right mind put their data infrastructure in a place like Silicon Valley? Sure there are lots of businesses there, lots of venture capital and tech talent, but from a disaster and pricing standpoint, Silicon Valley is a terrible place for data center colocation.

The only rationale for putting your infrastructure in Silicon Valley is the server hugger argument - people who just can't stand to have their hardware in a nearby state, in spite of the fact that they'd be saving tons of money and significantly lowering their disaster risk profile. Now a handful of businesses may require proximity for low latency like high frequency trading but that is a very small segment.

Recently an article was published which talked about targeted attacks in Silicon Valley on fiber paths, where people dressed up as construction workers would just go and cut fiber optic lines in targeted places throughout the Bay Area.

So not only do you run the risk of natural disasters such as earthquakes, but now you have man made disasters that can disrupt your service. Add onto that the high cost of power and high cost of living and you have to think that the server hugger mentality is going to cost a company far more than it should in cost and downtime. 

What does the server hugger mentality gain you? 17 milliseconds. That's the latency between Salt Lake City and Silicon Valley. 

Sources

Fiber lines being cut in Silicon Valley: http://arstechnica.com/tech-policy/2015/06/fbi-baffled-over-wave-of-nighttime-fiber-optic-cable-vandalism/

Server Hugger Mentality: https://gigaom.com/2008/11/26/trailer-park-20-where-all-your-data-lives/

Disaster Declarations by State: https://www.fema.gov/disasters/grid/state-tribal-government

Industrial Power Rates by State: https://www.rockymountainpower.net/about/rar/ipc.html

17 Millisecond Latency between Utah and Silicon Valley: https://www.c7.com/wp-content/uploads/C7-latency-map.pdf