We are seeing more and more that prices on cabinets in Dallas are creeping closer and closer to $2000 per month. There’s still $800 cabinets out there but you have to know where to look.

A few years ago $2000 cabinets only existed in AT&T and Verizon data centers while everyone else was under $1000 per month. It looks like those days are disappearing fast. Some of the privately held data centers are still under $1000 per month but they seem to be creeping higher and higher as well.

The rising cost of power has to be partly to blame for the increased rates. In 2006, TXU increased prices by 30%. So of course the data centers have to pass that cost along to their customers.

The biggest reason for increased prices in the data center industry is the increased power consumption and heat exhaustion of the new servers that are now the norm in the industry. In 2000, the average cabinet consumed 10 amps of power. Today, it is not uncommon for a cabinet to consume 100 amps of power. And they produce considerably more heat meaning more power and capital for HVAC units.

Years ago, our advice was never to sign anything longer than a one year term. However with oil prices still going up, we recommend that you lock in your prices for as long as possible.