8 ms·

Not to be insensitive about the humanitarian and economic situation, but, I am curious why there are data centers in that region at all? It just seems horribly

Not to be insensitive about the humanitarian and economic situation, but, I am curious why there are data centers in that region at all? It just seems horribly inefficient from a cooling and electricity standpoint. Not to mention water. My pessimistic assumption is that Amazon said "yes" to handouts from regional government efforts to be relevant in tech, and that those data centers dont really matter to anyone but local politicians and monarchs who believe they have a seat at the table.

watwut 6mo ago
Why would water for data center be an issue there? They dont need to drink it. It was business for those contries. Just like finance, travel and wgat have you.
- wiml 6mo ago
  Water is used for cooling. You take in liquid water, release water vapor, and the phase transition takes away a lot of heat. Otherwise you need to pump that heat into dry air, which is much more difficult (energy-expensive). It's the same thing you do when you sweat.
  - bryan_w 6mo ago
    But it's not a significant amount, compared to other uses in a city. You know this, right?
deleted 6mo ago
[deleted]
Fairburn 6mo ago
Once Iran ramps up, its going to be a free-for-all against all US data infrastructure. Iran has friends in low places so they don't have to do all of the dirty work themselves. This should be a wake-up call.
InvisibleUp 6mo ago
Hundreds of millions of people live in the Middle East and a lot of large corporations are based there. Likely they thought it would be profitable, and likely they saw some decent use.
mnky9800n 6mo ago
I think you are overfitting to temperature as a variable in this decision making equation.
einszwei 6mo ago
Data centers can run on closed loop cooling systems which doesn't need continuous water supply. Only bottleneck is Energy supply which the MEA area doesn't lack.
bawolff 6mo ago
I imagine the same reason they have a data center in places like Sao Paulo. More locally centred businesses want the low ping, and AWS wants to be your cloud compute provider of choice no matter where your target audience is.
rkagerer 6mo ago
If anyone here is involved in making decisions about where to locate such centers, I'd love to hear more about how geopolitical risk factors in, and whether you plan and price out contingencies (e.g. "This is near an unstable area, worst case is we write off $###M, but after Y years it breaks even. And the site is better in these other factors than alternative Z over there..."). Is it similar to factoring for geophysical instabilities (e.g. earthquake/tsunami zone) or other risks? Or would this type of event catch you completely offguard? I'm guessing insurance riders specifically exclude these types of risks.
- zipy124 6mo ago
  Insurance. No need to write off anything or take a loss, just a slightly increased yearly cost. The cost of said insurance is likely going to be very high for a long time now though.
  - wiml 6mo ago
    Sure, but insurance is just outsourcing that calculation to a third party. AWS is big enough that I would think they largely self-insure, though I don't know if they do.
  - rdl 6mo ago
    I insure a bunch of big datacenters (crypto mining, AI); there are really two main drivers of cost of insurance per $ of equipment: 1) Internal risks and controls within the datacenter (the company involved and their operating history, fires, flood, etc,) -- for a sufficiently "good" datacenter, you can assume it gets maxed out in quality, or at least to the point where it's no longer efficient to spend more. Most of these risks also cause service disruptions, so if you're building for high availability anyway, the rest of this stuff is usually handled as part of that. Essentially, if you're too cheap to build a good enough datacenter to max this out, you're not getting insurance anyway in most cases, so it's not a variable factor so bunch as binary or maybe a few broad risk bands (ISO tier for datacenters). 2) External risks. This is mostly natural catastrophe ("nat cat" or "cat risk"); usually there's one dominant driver of that ("severe convective storms" in Texas; floods and hurricanes in places like Florida; earthquakes in California). In some places it's multiple risks (Japan has both earthquake/tsunami and typhoon). This drives the majority of insurance premium. War risk, geopolitical, political risk, terrorism, SRCC ("strikes, riots, and civil commotion") are in a third category -- often essentially not a factor (e.g. for a $200mm facility in rural Texas), but often handled through special programs at a national level or specialty insurance. A lot of normal policies exclude or let the client buy-back that part of the risk. As my personal interests in war zones, drones, etc. and professional interests in crypto, AI, and datacenters seem to have converged, looking forward to seeing "quality of air defense artillery/integrated air defense system" as well as "comprehensive quick reaction force capable of dealing with national-level threats" as elements of insurance underwriting for $50B AI datacenters/"AI factories" in the future. I assume in most cases this kind of stuff will be handled by national, military, defense, or civil defense parts of the government, but could easily be contracted as well. I don't think Oracle Cloud is likely to stand up their own private army though.
tiew9Vii 6mo ago
Middle East isn’t some 3rd world. If you can imagine futuristic cities, rich Middle East countries are already living in them with all the oil wealth. They have phones, computers, digital services just like the US and Europe. Makes sense they want a data center in the region, close to them just like the US and Europe have data enters close to their users.
- andrepd 6mo ago
  Slight tangent, but to me futuristic cities are actually places like Amsterdam, with cozy streets and bike lanes everywhere, not places like Dubai with 16-lane freeways and a quasi-slave underclass staffing the tacky malls.
  - deleted 6mo ago
    [deleted]
  - lolive 6mo ago
    [flagged]
    - hdgvhicv 6mo ago
      Oil is required to get around cities like Austin, not to get around cities like Amsterdam
  - echoangle 6mo ago
    If you take futuristic to mean „looking like the future“, it think the second option is sadly more futuristic for some people
    - andrepd 6mo ago
      Indeed, but sprawling lead-smoke infested freeways is the stuff of the 1950s; bike lanes and playgrounds and grassy tram tracks is what some cities are starting to do just now! So actually more futuristic, objectively speaking :)
  - 6mo ago
toast0 6mo ago
There's a fair amount of nearby customers. There's decent connectivity via undersea cables to Europe, East Asia, and Africa. UAE, Bahrain, Qatar and Saudi Arabia are very encouraging of outside investments in their countries. I did some work with hosts on GCP in the region and you get fun things like hosts in Israel has bad routes to customers in nearby countries and vice versa, though. I don't know if AWS has access to better routing. Definitely a case where physical distance doesn't really correspond with network distance.
- c0balt 6mo ago
  To provide some practical examples, Dubai is it's own region in some online games like Valorant. It has relatively good connectivity to the region and there are enough customers there
paxys 6mo ago
Because there are customers there
someotherperson 6mo ago
Yes, and also pushed for by the Israeli and US governments. Tech investment is part of the Abraham Accords - i.e this is part of the prerequisites for normalization of ties with Israel.
- deleted 6mo ago
  [deleted]
2OEH8eoCRo0 6mo ago
It's extremely efficient from an evaporative cooling perspective.
- jasomill 6mo ago
  Aside from the energy cost of desalination.
gorgoiler 6mo ago
I was thinking the same thing about cooling. I guess a high pressure heat pump can work in any environment if it compresses a gas up to a temperature that’s higher than ambient. Couple that with abundant cheap energy — sunny, oily, and gassy! — and it doesn’t seem unreasonable at all.
- echoangle 6mo ago
  You can use a heat pump for any realistic output temperature but the efficiency goes down the higher the temperature difference has to be. As long as sun and wind aren’t the main energy sources there, it might be economical but I wouldn’t exactly call it reasonable.
seany 6mo ago
Data governance compliance is a huge issue for some industries. "The days can't leave the country" will drive AWSs normal customers to demand bespoke regions setup and turned on
- edgarvaldes 6mo ago
  Yes, I'm surprised no one else has commented on this. Some regulations require that at least some backups be located in the same country or region.
uluyol 6mo ago
Electricity? It's probably one of the best places in the world to have a solar+battery installation?
mememememememo 6mo ago
My guess. Edge compute. Data (coughlaugh) residency. Obsession with low latency on our 42Mb web pages.
mbreese 6mo ago
I think the easy answer is: because there are customers there. It’s a region full of major commercial and industrial companies. I can imagine that you’d want data centers close to where those customer are. Technically, I can see challenges in power and cooling, but those can be overcome. The real question is- Are there enough customers in the region to support local data centers? I think that’s clearly yes.
XorNot 6mo ago
Sovereign data requirements for government and business.
BurningFrog 6mo ago
Closed-loop water cooling systems are common and use very little water, despite what you may hear from alarmists.
elzbardico 6mo ago
> local politicians and monarchs who believe they have a seat at the table. Are you from another planet? They DO have a set at the table because gulf Sovereign Funds are one of the largest and most reliable LP pools available for VC funds for quite some time. The current AI buildout is heavily dependent on Gulf money. Oil is not forever and Sovereign Wealth Funds usually have goals that are not simply acruing direct investment returns, it makes sense that the folks deploying 100 billions tranches will have some say on where to put all those H100 their money will buy. Nobody sane would predict Israel and the US would start this war.
- teleforce 6mo ago
  >Nobody sane would predict Israel and the US would start this war. Israel predicted and started the war unless you consider they're insane [1]. [1] Iran is a distraction [video]: https://news.ycombinator.com/item?id=47640560 https://news.ycombinator.com/item?id=47640560
  - elzbardico 6mo ago
    Well, it is a tall calling to pretend Netanyahu and Trump are well adjusted, psychologically sane men.
adjejmxbdjdn 6mo ago
They have the cheapest oil in the world and in the future (and present) they will likely have cheap solar energy. And until this fine misadventure, it was also possible they would get extremely cheap nuclear energy. Given that the Gulf is fairly central, has tremendous flight connectivity, has tremendous capacity for business and business conference growth, Dubai was only looking to increase its share of global finance, law, and other major services, is a major center of shipping, is a region that has neutral to friendly relations with nearly every country, has 3rd world like cheap labor but first world like luxuries if you have the money, and a lot of money they were willing to spend on these data centers, it’s not the worst idea. Of course, that whole plan has come crashing down now that having US bases has turned from an asset to a liability.
- disgruntledphd2 6mo ago
  I mean, that plan was basically never going to work long term, given climate change.
vidarh 6mo ago
There are customers there, some of whom are large enough to create significant demand just by insisting on their compute and storage being local.

watwut 6mo ago

Why would water for data center be an issue there? They dont need to drink it. It was business for those contries. Just like finance, travel and wgat have you.

wiml 6mo ago
Water is used for cooling. You take in liquid water, release water vapor, and the phase transition takes away a lot of heat. Otherwise you need to pump that heat into dry air, which is much more difficult (energy-expensive). It's the same thing you do when you sweat.
- bryan_w 6mo ago
  But it's not a significant amount, compared to other uses in a city. You know this, right?

deleted 6mo ago

[deleted]

Fairburn 6mo ago

Once Iran ramps up, its going to be a free-for-all against all US data infrastructure. Iran has friends in low places so they don't have to do all of the dirty work themselves. This should be a wake-up call.

InvisibleUp 6mo ago

Hundreds of millions of people live in the Middle East and a lot of large corporations are based there. Likely they thought it would be profitable, and likely they saw some decent use.

mnky9800n 6mo ago

I think you are overfitting to temperature as a variable in this decision making equation.

einszwei 6mo ago

Data centers can run on closed loop cooling systems which doesn't need continuous water supply. Only bottleneck is Energy supply which the MEA area doesn't lack.

bawolff 6mo ago

I imagine the same reason they have a data center in places like Sao Paulo. More locally centred businesses want the low ping, and AWS wants to be your cloud compute provider of choice no matter where your target audience is.

rkagerer 6mo ago

If anyone here is involved in making decisions about where to locate such centers, I'd love to hear more about how geopolitical risk factors in, and whether you plan and price out contingencies (e.g. "This is near an unstable area, worst case is we write off $###M, but after Y years it breaks even. And the site is better in these other factors than alternative Z over there..."). Is it similar to factoring for geophysical instabilities (e.g. earthquake/tsunami zone) or other risks? Or would this type of event catch you completely offguard? I'm guessing insurance riders specifically exclude these types of risks.

zipy124 6mo ago
Insurance. No need to write off anything or take a loss, just a slightly increased yearly cost. The cost of said insurance is likely going to be very high for a long time now though.
- wiml 6mo ago
  Sure, but insurance is just outsourcing that calculation to a third party. AWS is big enough that I would think they largely self-insure, though I don't know if they do.
- rdl 6mo ago
  I insure a bunch of big datacenters (crypto mining, AI); there are really two main drivers of cost of insurance per $ of equipment: 1) Internal risks and controls within the datacenter (the company involved and their operating history, fires, flood, etc,) -- for a sufficiently "good" datacenter, you can assume it gets maxed out in quality, or at least to the point where it's no longer efficient to spend more. Most of these risks also cause service disruptions, so if you're building for high availability anyway, the rest of this stuff is usually handled as part of that. Essentially, if you're too cheap to build a good enough datacenter to max this out, you're not getting insurance anyway in most cases, so it's not a variable factor so bunch as binary or maybe a few broad risk bands (ISO tier for datacenters). 2) External risks. This is mostly natural catastrophe ("nat cat" or "cat risk"); usually there's one dominant driver of that ("severe convective storms" in Texas; floods and hurricanes in places like Florida; earthquakes in California). In some places it's multiple risks (Japan has both earthquake/tsunami and typhoon). This drives the majority of insurance premium. War risk, geopolitical, political risk, terrorism, SRCC ("strikes, riots, and civil commotion") are in a third category -- often essentially not a factor (e.g. for a $200mm facility in rural Texas), but often handled through special programs at a national level or specialty insurance. A lot of normal policies exclude or let the client buy-back that part of the risk. As my personal interests in war zones, drones, etc. and professional interests in crypto, AI, and datacenters seem to have converged, looking forward to seeing "quality of air defense artillery/integrated air defense system" as well as "comprehensive quick reaction force capable of dealing with national-level threats" as elements of insurance underwriting for $50B AI datacenters/"AI factories" in the future. I assume in most cases this kind of stuff will be handled by national, military, defense, or civil defense parts of the government, but could easily be contracted as well. I don't think Oracle Cloud is likely to stand up their own private army though.

tiew9Vii 6mo ago

Middle East isn’t some 3rd world. If you can imagine futuristic cities, rich Middle East countries are already living in them with all the oil wealth. They have phones, computers, digital services just like the US and Europe. Makes sense they want a data center in the region, close to them just like the US and Europe have data enters close to their users.

andrepd 6mo ago
Slight tangent, but to me futuristic cities are actually places like Amsterdam, with cozy streets and bike lanes everywhere, not places like Dubai with 16-lane freeways and a quasi-slave underclass staffing the tacky malls.
- deleted 6mo ago
  [deleted]
- lolive 6mo ago
  [flagged]
  - hdgvhicv 6mo ago
    Oil is required to get around cities like Austin, not to get around cities like Amsterdam
- echoangle 6mo ago
  If you take futuristic to mean „looking like the future“, it think the second option is sadly more futuristic for some people
  - andrepd 6mo ago
    Indeed, but sprawling lead-smoke infested freeways is the stuff of the 1950s; bike lanes and playgrounds and grassy tram tracks is what some cities are starting to do just now! So actually more futuristic, objectively speaking :)
- 6mo ago

toast0 6mo ago

There's a fair amount of nearby customers. There's decent connectivity via undersea cables to Europe, East Asia, and Africa. UAE, Bahrain, Qatar and Saudi Arabia are very encouraging of outside investments in their countries. I did some work with hosts on GCP in the region and you get fun things like hosts in Israel has bad routes to customers in nearby countries and vice versa, though. I don't know if AWS has access to better routing. Definitely a case where physical distance doesn't really correspond with network distance.

c0balt 6mo ago
To provide some practical examples, Dubai is it's own region in some online games like Valorant. It has relatively good connectivity to the region and there are enough customers there

paxys 6mo ago

Because there are customers there

someotherperson 6mo ago

Yes, and also pushed for by the Israeli and US governments. Tech investment is part of the Abraham Accords - i.e this is part of the prerequisites for normalization of ties with Israel.

deleted 6mo ago
[deleted]

2OEH8eoCRo0 6mo ago

It's extremely efficient from an evaporative cooling perspective.

jasomill 6mo ago
Aside from the energy cost of desalination.

gorgoiler 6mo ago

I was thinking the same thing about cooling. I guess a high pressure heat pump can work in any environment if it compresses a gas up to a temperature that’s higher than ambient. Couple that with abundant cheap energy — sunny, oily, and gassy! — and it doesn’t seem unreasonable at all.

echoangle 6mo ago
You can use a heat pump for any realistic output temperature but the efficiency goes down the higher the temperature difference has to be. As long as sun and wind aren’t the main energy sources there, it might be economical but I wouldn’t exactly call it reasonable.

seany 6mo ago

Data governance compliance is a huge issue for some industries. "The days can't leave the country" will drive AWSs normal customers to demand bespoke regions setup and turned on

edgarvaldes 6mo ago
Yes, I'm surprised no one else has commented on this. Some regulations require that at least some backups be located in the same country or region.

uluyol 6mo ago

Electricity? It's probably one of the best places in the world to have a solar+battery installation?

mememememememo 6mo ago

My guess. Edge compute. Data (coughlaugh) residency. Obsession with low latency on our 42Mb web pages.

mbreese 6mo ago

I think the easy answer is: because there are customers there. It’s a region full of major commercial and industrial companies. I can imagine that you’d want data centers close to where those customer are. Technically, I can see challenges in power and cooling, but those can be overcome. The real question is- Are there enough customers in the region to support local data centers? I think that’s clearly yes.

XorNot 6mo ago

Sovereign data requirements for government and business.

BurningFrog 6mo ago

Closed-loop water cooling systems are common and use very little water, despite what you may hear from alarmists.

elzbardico 6mo ago

> local politicians and monarchs who believe they have a seat at the table. Are you from another planet? They DO have a set at the table because gulf Sovereign Funds are one of the largest and most reliable LP pools available for VC funds for quite some time. The current AI buildout is heavily dependent on Gulf money. Oil is not forever and Sovereign Wealth Funds usually have goals that are not simply acruing direct investment returns, it makes sense that the folks deploying 100 billions tranches will have some say on where to put all those H100 their money will buy. Nobody sane would predict Israel and the US would start this war.

teleforce 6mo ago
>Nobody sane would predict Israel and the US would start this war. Israel predicted and started the war unless you consider they're insane [1]. [1] Iran is a distraction [video]: https://news.ycombinator.com/item?id=47640560 https://news.ycombinator.com/item?id=47640560
- elzbardico 6mo ago
  Well, it is a tall calling to pretend Netanyahu and Trump are well adjusted, psychologically sane men.

adjejmxbdjdn 6mo ago

They have the cheapest oil in the world and in the future (and present) they will likely have cheap solar energy. And until this fine misadventure, it was also possible they would get extremely cheap nuclear energy. Given that the Gulf is fairly central, has tremendous flight connectivity, has tremendous capacity for business and business conference growth, Dubai was only looking to increase its share of global finance, law, and other major services, is a major center of shipping, is a region that has neutral to friendly relations with nearly every country, has 3rd world like cheap labor but first world like luxuries if you have the money, and a lot of money they were willing to spend on these data centers, it’s not the worst idea. Of course, that whole plan has come crashing down now that having US bases has turned from an asset to a liability.

disgruntledphd2 6mo ago
I mean, that plan was basically never going to work long term, given climate change.

vidarh 6mo ago

There are customers there, some of whom are large enough to create significant demand just by insisting on their compute and storage being local.