What do COVID, cloud repatriation, increasing ransomware attacks, and the growth of AI have in common? They all had an impact on colocation in Connecticut over the past 5 years. As we begin a new year, let us look back at these factors and forecast the future of colocation in Connecticut.
The biggest change to local colocation was brought about by COVID. The pandemic hit the US in early 2020 and soon data centers in Connecticut were affected. The virus forced people to work remotely. Offices were closed or downsized. This accelerated the move to the public cloud.
Initially the pandemic stifled most new colocation projects. Organizations put a hold on any changes as they worked to adapt to the new Work From Home imperative. Within a year, new colocation projects were in the planning stages. Many offices wanted to reduce their footprint to save money. Moving IT systems to a data center such as CAPS’ facility in Shelton could help. Some clients employed colocation to move IT infrastructure from their office. This gave them more flexibility to adapt to changing office requirements.
Cloud Repatriation
Recently cloud repatriation has increased as the actual cost of the public cloud became apparent. Widespread adoption of the cloud led to surging costs for many companies. Some of the applications hosted on the cloud were not well suited for that environment. Today the “Cloud First” movement has been supplanted by a more pragmatic approach. The cloud is an appropriate choice for many workloads, but not for everything. Companies have selectively repatriated some workloads they had placed in the cloud and are now hosting these applications at colocation data centers or on-premises.
Though ransomware has been around since 1989, it has grown exponentially in the past 10 years. Cryptocurrencies, introduced in 2009, played a part in facilitating cybercrime. Ransomware-as-a-Service hit the market in 2012, and it also fostered more internet crime. Today ransomware is an increasing problem. Some organizations have moved critical IT backup systems to colocation data centers to increase their ability to survive a ransomware attack.
Data cabinet power density has been increasing for years. Five years ago, the average power consumed per rack was between 5 KW and 10 KW. Today average power consumption per rack is between 10 KW and 20 KW, depending on the application.
AI Everywhere
Since the introduction of CHAT GPT in 2022, the use of AI has been expanding exponentially and with it the need for much more power. Per cabinet power requirements of up to 100 KW are projected in the next few years as large banks of high-powered servers are installed to meet the heavy processing demands of AI applications.
The challenge for Connecticut’s data centers is significant. Our state has some of the highest electric power utility costs in the country. Initiatives to provide sources of lower cost power in the state have not been successful. Though there have been efforts to secure power for data centers directly from the state’s remaining nuclear plant, the Millstone Nuclear Power Plant in Waterford, these efforts have not been successful to date.
Unless substantial amounts of cost-effective power become available, our state’s data centers are not likely to see much growth from the AI boom. Any large AI projects will be hosted at data centers in other regions where the power costs are much lower.
Connecticut Colocation for Strategic AI Projects
Smaller strategic AI projects may be hosted at local data centers in the future. In these cases, the higher cost of power in Connecticut will not supersede other benefits of colocation in our state. These benefits include locations that are more convenient, reduced latency, and better local control and security.



