Today’s tsunami in Japan was relatively small in comparison with that which followed the devastating Tohoku earthquake in March 2011 but it still serves as a reminder of the event. FOCUS looks back at the aftermath of the Japan earthquake of 2011 to see what the overall effect on the industry has been

Tepco – the power company – sells its data center business
In September this year, the Tokyo Electric Power Company (Tepco) was forced to sell its data center business @Tokyo to make up for liabilities caused by the Fukushima Daiichi nuclear accident caused by last year’s devastating Tsunami.

Japanese security company Secom, which already operates five data centers in the country, said it plans to purchase 80% of the data center business to make way for its own expansion plans.

@Tokyo has annual revenue of about ¥25bn and Tepco is asking ¥50bn for its handover, according to a Reuters report.

Tepco’s Fukishima Daiichi Power plant was famously disabled, causing wide-spread power issues across Japan’s northern island, in regions including Tokyo, after tsunami waves of 14m hit the plant, which was designed to withstand waves of 5.7m. This disabled the emerging reactors and caused what was thought to be partial nuclear meltdowns. The event caused loss of life, and could still cause the loss of Tepco’s otherwise successful data center business.

The need for intelligent networks
In November this year, Ciena’s Mervyn Kelly highlighted networks are becoming more resilient, and much smarter as a result of the lessons learned from recent natural disasters – from the floods in New York to the Tsunami in Japan almost a year ago.

Last year’s earthquake and Tsunami in Japan damaged about half of the cable running across the Pacific Ocean and repair times were quoted to be between a week and several weeks. Downtime severely impacted the revenues of numerous network operators and enterprises. Read Mervyn Kelly’s the full article here.

The rise of the Cloud
As companies scrambled to recover, cloud services grew, not only for basic business requirements but for disaster recovery - and companies around the world benefitted.

In its annual earnings this May, Silicon Valley-based NetApp said revenue was up by 22%, part of this was attributed to the deployment of NetApp technology by Japan’s Softbank Group which provided free or discounted cloud services to businesses, government agencies and non-profit organizations days after the earthquake and tsunami in Japan. It also extended internal virtual desktop services to 14,000 of its employees displaced by the disaster.

Following the tsunami, it was said that a number of local government agencies and businesses in the affected area had lost all computing equipment, and much of their records, with many data center operations being maintained in-house without secondary backup.

IBM also announced it would open two new data centers to provide cloud services following demand seen as a result of the event. Its cloud center in Makuhhari, however, had opened before the earthquake hit. It started providing its enterprise services and LotusLive collaboration services in the country.

The need for Disaster Recovery
A number of data centers also opened outside of the affected area in Japan and South Korea to offer disaster recovery services after the event. And demand appeared to be strong, with many companies now realizing the benefit of geographically dispersed sites.

In July IIJ opened its Kozu data center in the Osaka-Kobe region with companies affected by the tsunami and earthquake in mind.

“The drive to build more backup data centers in the Osaka area has become an integral part of disaster recovery plans and business continuity plans since the Great East Japan Earthquake, and the new Kozu data center was constructed to meet this need," IIJ representatives wrote in a statement.

Pacnet opened a new data center in Hong Kong in December 2011 that it said was designed to meet the rising need for disaster recovery not only in Japan but across Asia following the event. It cited the tsunami, however, as being a key reason for the rise of disaster recovery services.

Stories of persistence
Many of Japan’s data centers – apart from the rolling brownouts – were well prepared for the Japanese Tsunami and earthquake. Being constructed in a zone known for high levels of seismic activity, most already had strong measures in place.

At DatacenterDynamcis San Francisco in 2011, JDCC member Atsushi Yamanaka said the Japanese data center industry weathered the earthquake and the following tsunami rather successfully, with no critical damage reported to the council. He said Japan’s data centers were able to survive the disaster relatively unscathed because of the way they were designed.

Japan’s building codes already require a number of earthquake resiliency measures for building design and many data centers exceeded these. The fact that data centers eventually became exempt from the rolling brownouts which affected non-critical services in the country also helped.

Just after the earthquake hit, FOCUS spoke with KVH, which at the time said it was provisioning its data centers to run seamlessly without the rolling power cuts. It said there was limited fuel in the market and water supplies.

Its senior project director Imtiaz Issadeen offers a nice look into how Japan’s data center operators provision for such events here.

It wasn’t only established players, however, that seemed to take the event in their stride. The Tsunami did not stop the Japanese and French atomic agencies and vendor Bull from going ahead with plans to build a new supercomputer in Rokkasho, an area affected by the tsunami. The facility opened in March this year. The Petascale Helios supercomputer will be used to research nuclear fusion.

Bull chairman and CEO Philippe Vannier said the project proved the Japanese team’s technological and logistical prowess. “In the face of extremely difficult circumstances, our Japanese colleagues have demonstrated remarkable professionalism,” he said.

Rokkasho – home to the Rokkasho Reprocessing plant nuclear facility - was in the far north of the tsunami zone and also suffered outages during the event.

Investment in energy efficiency and data centers
The rolling brownouts that followed the Tsunami in Japan led a number of data center operators to assess how they use power, and in turn invest in green technologies. The Japan Data Center Council said with a new focus on efficiency and redundancy, it believed the industry could come out of the earthquake much stronger than before.

But it wasn’t only existing data centers receiving investment funds. In August, 2011, a new investment fund managed by Diamond Realty Management, part of Mitsubishi Corporation, was established with 25.8bn yen to target what it says is a recovering market. “Japan’s real estate investment market has started to show signs of recovery after the financial crisis and earthquake,” it said.

New innovations
The event also led a number of vendors to design new technologies for the industry. The energy efficiency demand has led Toshiba, for example, to build a new modular data center that uses free air cooling.

And Sony released a battery designed especially for use by small data center in times of disaster. The unit can reach full charge in about two hours and support servers through short power outages and is marketed for areas prone to failures and brownouts.

Moving to South Korea
Other operators chose to put decisions to build in Japan on hold, however. In August, Microsoft Korea CEO Kim James Woo said Microsoft was considering South Korea for a large data center before Japan, as a precautionary measure.

Microsoft shifted data from a facility in Japan during the event to a facility back in the US.

Despite this, CB Richard Ellis’ (CBRE) Steven Taylor says demand for data center space will always be present given the strength of the local economy and general growth in internet usage in Japan. But many global investors may be rethinking a move into the country following the events.

“There will always be consistent local demand in Japan,” Taylor says. “But as an international cloud location, Japan is not top of the list right now. The earthquake and tsunami didn’t cause a great deal of downtime but they have created that perception, which means many companies would choose another country such as Singapore over Japan.”

South Korea’s KT corp also struck a deal with Japan’s Softbank which will see the Japanese telco use its data center is Busan, south Korea for disaster recovery services. Offerings were made available this week.