Technology data center opens in downtown Las Vegas

Kevin Ferguson

Friday, Aug. 3, 2001 | 11:03 a.m.

A Dallas high-tech company has turned part of the first floor of an old downtown Las Vegas bank building into a technology data center.

Collocation Solutions has taken over 18,000 square feet of space at 302 Carson Street, hoping to attract businesses that are seeking a cheap and safe place to store highly sensitive computer servers that require a climate-controlled environment.

At the company's Las Vegas grand opening Thursday, Collocation Solutions co-founder Don Frasier said his company has plowed $4 million worth of telecommunications and data networking equipment into the building.

He said 40 percent of the 18,000-square-foot space has been leased. Vancouver, Wash.-based Electric Lightwave Inc., which provides telecommunication services, has subleased 2,500 square feet.

Bill Perna, Electric Lightwave general manager, said 20 percent of his company's space has been leased.

Neither Perna nor Frasier would disclose the names of companies that store their servers in the center because of security concerns -- a key reason companies rent space in these types of operations, which are also called "telco hotels."

If a business office is broken into and computers are stolen or damaged, the business need not be shut down if its computer servers are stored in a highly-secure off-campus site.

"It makes a lot of sense for businesses to use these colocation facilities," said Richard Fitzpatrick, chief executive of the Internet Business Alliance of Nevada. "But the problem is I don't think a lot of companies realize how much its needed.

"They don't realize the problem of having a computer server stored down the hall in a closet," Fitzpatrick said.

Fitzpatrick said that's why some colocation centers in the Las Vegas Valley have struggled to fill their space.

Frasier would not disclose the charge to rent space in his center.

Gil Freeth, technical manager for the Las Vegas office of Analysts International, said the cost savings for companies that colocate their servers could vary due to a number of factors.

"But a small web retail company with 50 employees or less could have a 60 percent cost savings, because it wouldn't need extra software and hardware equipment and database maintenance (staff)," he said.

Mike Imhof, vice president of Las Vegas-based consulting firm Advanced Information Systems, said colocation facilities also reduce the need for an internal staff to monitor the computer servers around the clock.

At capacity, Frasier said the Collocation Solutions' facility will employ between six to 10 people. Collocation Solutions is funded by three venture capital firms: BG Media of New York, Mark Point Ventures of Dallas and Hunt Capital Group of Dallas.