Cloud star ScaleMatrix plans modular data center product launch

US-based ScaleMatrix is a colocation, cloud and datacenter service provider that has attracted more than 400 customers since it opened for business in late 2011. It rose to prominence in 2013, when it was chosen by Dell as one of three vendors to run Dell's North American cloud services business.

Now ScaleMatrix is set to become a provider of micro-modular datacenter designs: it plans to commercialize its proprietary datacenter cabinet. The cabinets do not include servers, but are designed for high-density deployments. They are also self-contained, which means customers can use them to incrementally upgrade their power or density capacity without the need for traditional cooling containment.

The cabinets are already deployed throughout ScaleMatrix's two US datacenters (where it provides its datacenter services). ScaleMatrix plans to officially launch its cabinets as a commercially available product in the second half of 2014, although it is already supplying them to one very large (unnamed) customer.

The 451 Take

As a young provider of datacenter services, ScaleMatrix is proving successful. However, micro-modular datacenters is a very different market (in fact, the term micro-modular, which 451 Research uses, is still not established). Unlike the large and relatively mature datacenter services sector, which is fragmented by many regional suppliers, the market for micro-modular datacenters is small and nascent. As a micro-modular vendor, ScaleMatrix will likely compete against datacenter equipment giants Schneider and Emerson, as well as smaller specialist suppliers. ScaleMatrix is neither large nor specialist. Yet because the company uses its cabinets in its own datacenters, the product already has some level of market validation – from Dell and the other 400 or so customers of ScaleMatrix's datacenter services.

Context

San Diego, California-based ScaleMatrix was founded in 2010, and launched its datacenter services business in late 2011. ScaleMatrix says it has more than 400 cloud customers that comprise 68% of its total recurring revenue. It has other large customers in addition to Dell, in the technology, pharmaceutical, biotech, healthcare and finance industries. Most cannot be publicly named. Reference customers include Bumble Bee Foods, the San Diego Padres Major League Baseball team and the real estate firm Fairfield Residential. (See our previous report for details of ScaleMatrix's positioning in the datacenter services sector.) Privately held ScaleMatrix does not disclose financial information. Management says it is evaluating offers for funding, which would enable it to expand its facilities and its geographic reach.

ScaleMatrix has two datacenters, and both are fitted out using its patent-pending cabinets. These are self-contained cabinets that hook into ceiling-mounted power, cooling and networking infrastructure that is enclosed in metal tubing. There are no exposed cables or wires, which reduces the risk of unauthorized tampering.

Colocation providers typically offer customers secured cages to house their IT. In ScaleMatrix's facilities, there are almost no cages; customers use its enclosed cabinets, which are biometrically secured and also offer privacy to customers that want to keep their infrastructure and network design from prying eyes. Being enclosed means the cabinets also make its datacenters remarkably quiet. ScaleMatrix says its decision to productize its cabinets – which include datacenter infrastructure management (DCIM) software, fire suppression, efficient cooling capabilities and electrical management systems – was prompted by a request from one of its (very large) customers.

ScaleMatrix owns and operates more than 100,000 square feet (about 9,290 square meters) of datacenter space in San Diego, which is capable of supporting 10MW of critical load. In Houston, it is an anchor tenant in a large mixed-use wholesale datacenter facility that is operated by StratITsphere. ScaleMatrix has room for considerable expansion at both sites.

ScaleMatrix's facilities have a similar layout. The company calls it a 'franchise' approach; customers can expect a similar experience at each location. The facilities are a mix of colocation, managed high-performance storage (SAN), traffic management, and public and private cloud services. The company operates a private and diverse 10GB ring between its two facilities. Data is mirrored between the sites, enabling the company to also offer disaster-recovery and business-continuity services. (Customers allocate a primary site.) ScaleMatrix has partnerships with CoreSite, Dell and Level 3 Communications to support customer data-backup needs in other locations globally.

Technology

Full details of ScaleMatrix's Dynamic Density Control cabinets, including price, have not yet been released. They will include a standard-sized 45-rack unit, and a 19-inch enclosure into which power, networking and its closed-loop, low-pressure, chilled-water cooling systems are connected. The cabinets are energy efficient. In ScaleMatrix's flagship in San Diego, they operate with a supply temperature of 65 degrees Fahrenheit (18 degrees Celsius). ScaleMatrix uses slab floors in its existing facilities, but the cabinets can be outfitted to support both raised and slab floor deployments. Each cabinet has integrated FM200 fire suppression.

There are two versions of the cabinets: one supports IT loads up to 25kW, while a high-density version supports up to 45kW. (High-density clients hosted at its San Diego facility typically average about 34kW). They can be deployed for customers wanting as few as 10 high-density racks, and can scale to several thousand racks or more (as ScaleMatrix has done in its headquarters).

The cabinets are designed for 2N power redundancy. Two cabinet power distribution units (CDUs) from Servertech run vertically along each side of a rack, fed by separate utility substations. At the San Diego facility, one floor-standing 300KVA power distribution unit (PDU), also housed in a ScaleMatrix-designed enclosure, supplies power to between 15 and 30 cabinets, depending on the density deployed by clients.

Servertech's rack-mounted CDUs have outlet-level monitoring and control capabilities. The CDUs monitor input power and the power delivered to each outlet, tracking voltage, current and power factor. They are known as 'switched' CDUs because they allow users to remotely turn specific outlets on and off. Servertech's smart CDUs have both serial and network connections. Using ScaleMatrix software portal, users can connect to an individual CDU and get data, configure alert thresholds and perform other tasks. The cabinets can be integrated with various cooling systems, including water and air-side economization. ScaleMatrix says they can be deployed in a wide range of datacenter environments.

The amount of cooling and power supplied to each cabinet is automatically adjusted in real time by software. The cabinets be used with ScaleMatrix's DCIM system or integrated with third-party software. At ScaleMatrix's datacenters, the environmental conditions inside the cabinets, including temperature, humidity and air pressure, are monitored by ScaleMatrix's software. This data, along with power-consumption data from smart PDUs inside the cabinet, is aggregated and normalized by Servertech's DCIM software, called Sentry Power Manager.

The combined ScaleMatrix and Servertech software reports on environmental and power conditions, as well as the trends of individual cabinets and throughout a datacenter. The software includes a network operations center (NOC) tool that allows users to view data from multiple datacenter sites. Using industry-standard APIs, Sentry Power Manager can push power data to other management systems and software.

Digitus Biometrics supplies the cabinets' biometric security system. The system scans fingerprints and can notify a manager with an email or text whenever a cabinet is opened. The platform will also notify the ScaleMatrix NOC if a cabinet is left open longer than expected. This biometric log, combined with cameras in each row, means there is an identification trail for anyone accessing the cabinets. (The company attributes some of its success in the highly regulated hosting space to its security and information logging.)

The cabinets are NEMA 3 rated, making them airtight and watertight. They also sit on four one-inch legs, to keep the cabinets off the datacenter floor in case of a water leak in the facility, and for extra protection as part of a facility's seismic reinforcement. Because they are fully enclosed, and the inside temperature is managed within a two-degree variation, ScaleMatrix says its cabinets are virtually dust-free (which can extend the life of the IT gear housed within).

Competition

There are dozens of suppliers of prefabricated modular datacenter products, which vary from self-contained cabinets to large, contiguous raised-floor data halls. Only a few of these vendors offer self-contained cabinet products. The closest comparison to ScaleMatrix's cabinets may be Elliptical Mobile Solutions' R.A.S.E.R. line, which are certified for outdoor use.

There are other prefabricated cabinet products, such as AST Modular's Smart Bunker line. (Schneider Electric acquired AST for an undisclosed amount in early 2014.) Emerson Network Power also has enclosed rack offerings, which are similar but not equivalent to ScaleMatrix's. Emerson's SmartRow and SmartAisle products can be used in an office or warehouse environment for low- and medium-density loads.

There are certain containerized prefabricated modular datacenters that might be a proxy to micro-modular cabinets like ScaleMatrix's. IO, a Phoenix-based vendor that is also a colocation service provider, offers self-contained IT modules that can be densely installed side-by-side to create scalable facilities supported by modular electrical and mechanical units. There are also numerous suppliers of containerized datacenters, including IBM, Dell, HP and virtually all of the large IT vendors.

SWOT Analysis