How should we view “Eastern Numbers and Western Calculations”?

In the past two days, there has been a lot of news about "East Data West Computing", which has attracted widespread attention from both inside and outside the industry.

In fact, in the middle of last year, Xiaozaojun published an article on "Eastern Data and Western Computing". At that time (May 24, 2021), the National Development and Reform Commission jointly issued a document with several departments, called "Implementation Plan for the Computing Hub of the National Integrated Big Data Center Collaborative Innovation System" (Fagai Gaoji [2021] No. 709). In the document, it is clearly proposed to build a national hub node of the national integrated computing network and develop a data center cluster.

Two days later (May 26), at the opening ceremony of the 2021 Guiyang Big Data Expo, the official announcement of the launch of the National Hub Node Project of the National Integrated Computing Network was made, thus bringing "East Data West Computing" into the public eye.

Now, the National Development and Reform Commission has once again jointly issued a notice with multiple departments, agreeing to start the construction of national computing power hub nodes in eight places including Beijing, Tianjin and Hebei, and has planned 10 national data center clusters.

This marks that the overall layout design of the "National Integrated Big Data Center System" has been completed and the "East Data West Computing" project has officially started in full swing .

In today's article, Xiaozaojun will interpret the key content of "East Data West Computing" from a personal perspective, supplement some easily overlooked information, and help everyone more fully understand the details of this national digital infrastructure project.

"Number" refers to data, and "calculation" refers to computing power.

Regarding computing power, Xiaozaojun has been talking about it a lot in recent years. Everyone should be familiar with it, that is, the ability to process data.

In short, "Eastern Data, Western Computing" means building a data center to move the data and demands generated by economic activities in the eastern region to the western region for calculation and processing.

Today we are in the digital age, and we cannot do without the support of digital technology. The main forms of support for digital technology are connectivity (communication) and computing power (IT) .

Connectivity includes communication technologies represented by 4G/5G and optical broadband. Computing power is divided into hardware and software, which are more familiar to everyone, including CPU, memory, hard disk, operating system, database, application software, etc.

Over the years, as digital technology has rapidly penetrated into various industries and fields, the importance of connectivity and computing power has increased, becoming the representatives of advanced productivity.

Without them, the digital transformation that our country is actively promoting now will not be successful, and the development of the digital economy that we have high hopes for will also lose its source of power.

To obtain powerful power, a large amount of connection and computing power infrastructure must be built .

The 5G and Gigabit cities we are working so hard to build now belong to the connectivity infrastructure. As for the computing infrastructure, as we all know, it mainly refers to the data center (IDC) .

Data Center (IDC)

In the “new infrastructure” strategy proposed by the country in early 2020, data centers were clearly listed as one of the seven major construction areas.

The country’s 14th Five-Year Plan makes it very clear: we must “accelerate the construction of a national integrated big data center system, strengthen the coordinated intelligent scheduling of computing power, build a number of national hub nodes and big data center clusters, and build E-level and 10E-level supercomputing centers.”

According to forecasts, the domestic demand for computing power will grow at a rate of 20% per year. It is urgent to vigorously promote the construction of computing power infrastructure.

According to the specific plan of the "East Data West Computing" project, the country will start building national computing power hub nodes in eight places, including the Beijing-Tianjin-Hebei region, the Yangtze River Delta, the Guangdong-Hong Kong-Macao Greater Bay Area, Chengdu-Chongqing, Inner Mongolia, Guizhou, Gansu, and Ningxia, and will build 10 national data center clusters in Zhangjiakou, Wuhu, Shaoguan and other places.

The 8 hub nodes are actually a "4+4" structure, divided into two categories with different positioning, functions and requirements.

The Beijing-Tianjin-Hebei region, the Yangtze River Delta region, the Guangdong-Hong Kong-Macao Greater Bay Area, and the Chengdu-Chongqing region belong to the first category. These regions are the core areas of economic development in our country and are also important urban agglomerations. The first three in particular are located in the economically developed eastern coastal areas.

These regions have large user scales and strong application demands. After completion, the hub nodes basically serve the needs of the region, which is "internal consumption".

Inner Mongolia, Guizhou, Gansu and Ningxia are all in the western region, where the local demand for computing power is not large. As hub nodes, their main function is to "export computing power."

In other words, they can build low-cost, low-energy data centers to meet the computing power needs of the eastern region by leveraging their advantages of low land costs, abundant renewable energy (wind power, hydropower), and suitable climate (low temperatures in the north).

In addition to the cost difference, the main difference between the eastern and western hub nodes lies in their different "missions".

Anyone who works in communications knows that communication delays caused by physical distance are inevitable. The biggest problem with western data centers delivering computing power to the east is delay .

Therefore, network applications that are very sensitive to latency, such as autonomous driving (Internet of Vehicles), industrial manufacturing (robots), telemedicine, financial securities, and disaster warning, must be completed at the data center where the application is located or closest to the location.

The western data center will take on more network applications that are not sensitive to latency, such as back-end processing, offline analysis, and cold data storage and backup.

What is "cold data" ? Data with low access frequency is cold data. Correspondingly, data with high access frequency is "hot data". Data with neither high nor low access frequency is "warm data".

Data storage has the characteristic of changing from hot to cold. Most data will become "cold data" 6 months after it is generated. Cold data accounts for 80% of the total data and occupies a high proportion of storage resources.

On the surface, “Eastern Data and Western Computing” is to promote the construction of data centers. However, I personally believe that the more important significance lies in promoting the orderly construction of data centers.

In other words, the focus is on policy guidance and macro-layout. It is not simply about pursuing an increase in quantity, but about strictly controlling the healthy and rational growth process.

In recent years, the growth rate of domestic data centers has been rapid. At present, the scale of domestic data centers has reached 5 million standard racks, with more than 2 million in operation, and a computing power of 130 EFLOPS (1.3 trillion floating-point operations per second). The number of newly added cabinets in China exceeds 300,000 each year.

Driven by cloud computing and big data, enthusiasm for building data centers in various regions is too high, even a little fanatical.

All regions, regardless of whether their geographical location is suitable or whether they have sufficient economic and technical strength, are starting to build data centers. Some data centers have backward functions, low utilization, high energy consumption, and basically do not play a role, or even lose money.

Here, I would like to introduce two important indicators related to data centers.

The first is the shelf rate .

Shelf rate = number of servers that have been put on the rack and are running / number of servers that the rack can accommodate. The higher the indicator, the higher the utilization rate of the data center.

Another indicator is PUE , which stands for Power Usage Effectiveness.

PUE = total energy consumption of data center / energy consumption of IT equipment. The total energy consumption of data center includes the energy consumption of IT equipment, as well as the energy consumption of other systems such as cooling and power distribution.

The PUE value is definitely greater than 1. The closer it is to 1, the less energy the non-IT equipment in the data center consumes, that is, the higher the energy efficiency level.

According to the requirements of the "Eastern Data and Western Computing" document, the PUE index of cluster data centers in the eastern region must be controlled within 1.25, and within 1.2 in the western region, and the average shelf rate must not be less than 65%.

This is equivalent to drawing a red line for data center construction. Many built data centers may face the fate of being shut down. (Most domestic data centers have a PUE between 2 and 3.)

For areas outside the core hub nodes, the document clearly requires: "Local governments shall not grant preferential policies in terms of land, finance and taxation", "Coordinate the planning and layout of data centers within the province, strengthen connections with national hub nodes, and participate in the cascade scheduling of computing power between the country and the province . "

In other words, non-hub nodes can only build small and medium-sized data centers at most and play a supporting role.

Such planning requirements are obviously conducive to the rational layout of the industry and the realization of the country's "dual carbon" strategic goals.

In 2020, data centers across the country consumed 204.5 billion kWh of electricity, accounting for 2.7% of the total electricity consumption in society. It is estimated that by 2025, this value will reach 395.2 billion kWh, and the proportion will increase to 4.05%.

China's current power structure is still dominated by coal-fired power generation. In the power supply structure of data centers, thermal power accounts for more than 70%, which will produce a large amount of greenhouse gases and other pollutants.

The electricity cost of a data center accounts for 56.7% of its operating costs. If the electricity cost cannot be controlled, it will also have an adverse impact on the economic benefits of the data center.

Therefore, the country is promoting “East Data and West Computing”, migrating computing power to the western region where energy costs are lower. This can not only improve the country’s overall computing power level, but also save money and reduce the impact on the environment.

According to the target, by the end of the 14th Five-Year Plan, the proportion of data centers in the east will drop from 60% to about 50%, while the proportion of data centers in the west will increase from 10% to about 25%.

Just now we calculated the "economic accounts" from the perspective of the country, and the conclusion is obvious.

Next, let’s take a micro perspective and see what impact the construction of a data center will have on the local economy in the western region.

Xiao Zaojun personally believes that data centers, as digital infrastructure, mainly contribute to the country's macro-development. For local areas, the benefits are not obvious, at least not comparable to the "old infrastructure."

During the construction of the data center, some local jobs and basic civil construction economy will be driven. However, that is all.

Speaking of this, let’s briefly talk about the industrial chain of data centers.

The data center industry chain is shown in the figure below, which is mainly divided into upstream equipment, facilities, software and hardware suppliers, midstream IDC builders and service providers, and downstream application users in various industries.

In terms of data center hardware composition, it is mainly divided into underlying infrastructure (power supply and distribution system, heat dissipation and refrigeration system, etc.) and IT and network equipment (servers, storage, data communication equipment, etc.).

These equipment and facilities will definitely not be manufactured locally.

After the data center is built, the only income left for the local area is electricity bills and land rental.

Data centers are now operated and maintained automatically. Unlike factories, they do not require a large number of workers, which can drive employment.

The businesses carried by data centers are all application-layer values. For example, Internet companies, for the profits they earn through data centers, will definitely not be taxed locally, but at the location of their headquarters.

Therefore, building a data center, apart from some publicity value, has limited help to the local economy.

"Eastern Data and Western Computing" is not just a matter of computing power, it is closely related to our communications.

The smooth flow of computing power requires the support of communication networks. In other words, without developed "transportation capacity", even if the computing power in the western region is strong and cheap, it cannot be delivered to the eastern region.

In order to better implement the "Eastern Data and Western Computing" strategy, the country will invest heavily in building a backbone network between data centers. In particular, the communication infrastructure in the western region will usher in a comprehensive upgrade.

A number of "East Data and West Computing" demonstration routes will be built between the east and the west.

“Eastern data and western computing” will definitely adopt all-optical networks.

Technologies such as OTN, ROADM/OXC, SDON, FlexO, and automated optical network management and control will play a huge role, and the market for high-speed optical modules such as 400G will also be further stimulated.

For the optical communication industry, "Eastern Data and Western Computing" is definitely a big cake that cannot be missed.

Well, the above is Xiaozaojun’s interpretation of “Eastern Counting and Western Calculation”.

The construction of data centers is of great help in driving the development of the industry. However, we should also note that some of the data center's software and hardware with higher profit value are in the hands of foreign companies. Although many domestic companies are involved, their profit margins are not that high.

In other words, a lot of money from building data centers may end up being earned by foreigners. It is still necessary to find ways to increase the profit margins of domestic data center-related companies.

In addition, the security of data centers also needs more attention.

Data centers, like power plants and water plants, are important national infrastructure that needs to be prepared for threats such as war, terrorist attacks, earthquakes, and floods. In addition to offline physical threats, online cybersecurity attacks are even more difficult to prevent.

How to establish a more complete data center security system and emergency plan, and how to enhance the attack prevention capabilities of data centers are issues worthy of continuous thinking and exploration.

Finally, I hope that the “East Data West Computing” project can be built smoothly, contribute to the development of the country’s digital economy, and help us win the more intense technological and economic games in the future.

Thanks!

references:

1. "Historic moment! The national project of "Eastern Data and Western Computing" is fully launched", Zhidongxi;

2. "Why can the hotly discussed "Eastern Data and Western Computing" be compared with the South-to-North Water Diversion Project?", Suning Financial Research Institute

3. Data Center Industry Map Research Report, China Academy of Information and Communications Technology

This article is reprinted from Xianzao Classroom, written by Xiaozaojun.