Will The Results of Google’s Power Tilt Be A Competitive Advantage, or Shared with All?

Just wondering, given this news. From a Weisel report: Voracious power needs: Given the rapid expansion of Google's user base and the increasing volumes of search activities, Google's power needs are large. The company has strategically positioned many of its data center to be closer to the power that…

Just wondering, given this news. From a Weisel report:

Voracious power needs: Given the rapid expansion of Google’s user base and the increasing volumes of search activities, Google’s power needs are large. The company has strategically positioned many of its data center to be closer to the power that is required to run its business, but if usage spikes, costs can increase and the RE<C initiative would be one way to increase the consistency of attractive pricing for its power needs. While the company does not disclose its power expenditures, we estimate all of Google’s power needs reside it in its cost of goods line and that power is responsible for 20-30% of COGS (ex depreciation). This would suggest that Google could potentially spend $500-700mn annually in 2008 on power alone, resulting in three to four points of margin. As such, the cost savings associated with affordable renewable energy and a steady source of reliable power could ultimately put the company at a competitive advantage.



Er…but will the learnings be shared? Is this a new business Google intends to own, or an initiative it intends to spearhead? I’ll ask…

0 thoughts on “Will The Results of Google’s Power Tilt Be A Competitive Advantage, or Shared with All?”

  1. From a WSJ article in tomorrow’s paper, Brin says Google won’t try to lock this up:


    Google co-founder Sergey Brin said the company will encourage its partners to license their technology for modest sums to encourage rapid deployment and bring electricity to parts of the world that don’t have it now — roughly 1.6 billion people, or 24.5% of the world’s population in 2005. “We don’t feel like we need to own every piece” of the technology, Mr. Brin said. “We want the problem solved.”

    Also, what does Makani Power do, which Google has already invested $10M in?

    “High altitude wind power,” aka big kites.

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