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Stocks R / Rackable Systems
|Subject: Re: GOOG no longer search for AMZN||Date: 5/20/2006 1:00 PM|
|Author: xyzzy420||Number: 18 of 28|
I hold a small position in RACK. It is one of my speculative holdings, meaning I'm taking more on the potential that than the fundamentals, kind of like when I picked up AOL way back when they were distributing version 2.2 on a floppy disk - and YHOO & AMZN back in the late 90's. I was lucky enough to move during 2000 and needed to cash in all my stocks to buy a house. So I'm hoping for some action on the concept on this one.
I picked RACK because a major concern in large data centers is the amount of heat generated, power consumed, and space the equipment takes up. The more heat generated, and power consumed to cool it is a factor in the amount of UPS systems required to power it during a power loss. The savings on power, less A/C system capacity, less UPS capacity, and less real estate (or more likely more systems in the same space).
I'm a network engineer. In our computer center with just 30 (not RACK) servers, we have about 15 minutes on battery in the event of a power outage. This is with a big truck sized UPS in the room. Even if we could run on battery longer, without the A/C system running, the room would surpass 100 degrees F in half an hour.
Of course you could have generators etc. etc. but the cost increases exponentially them more fail-safes you have to add.
The reason I was concered about Dell & AMD, is because we love Dell servers, and we love AMD chips since the chips are inherently cooler and use less power, and have higher pefermance than intel chips, at least right now. I worry that Dell might start their own line in direct competition with RACK, but they can't, RACK has patented everything needed to make it happen. Hey, maybe Dell can just but out RACK if it keeps going down.
When I go the the web site, I see who uses Rackable systems, at least according to the web site - Toshiba, Yahoo, Electronic Arts, Deutsch Bank, Amazon. Somewhere I got the impression that they supply equipment to Google and Akamai and MSN Search.
A lot of business parks you see that have the nicely landscaped lakes - they are actually used to cool water circulated from the data center, much like a nuclear reactor.
RACK serves a $23 Billion market, growing at 10%/year. So far, they've only dipped their toe in the ocean of money to be made, I hope they'll jump in, or at least stand there while the tide comes in.
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