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Dave Perrill on the Tier Zero Data Center
At Mining Disrupt Miami 2019, Compute North's CEO argued that mining and some high-performance computing do not need tier four redundancy.
Seven to twelve million dollars per megawatt. That is what Dave Perrill said a tier four data center costs to build. Perrill, then CEO of Compute North, a Minneapolis company that built infrastructure for miners and high-performance computing, made the case at Mining Disrupt Miami 2019, held July 23 to 25, 2019.
His question for the room was simple. "And I think the question needs to be asked is, do all applications require this level of redundancy and reliability?"
He said they do not, and that miners were already building the alternative. Modern data centers have no single point of failure: the fiber, the electrical systems and the cooling are all redundant. But on top of the build cost, he said, every dollar spent on energy for computing brings another 80 percent to a hundred percent spent on ancillary systems, and these sites take more than two years to bring online.
Miners, he said, have different needs. They run specialized hardware that you will not find in an office. The industry had reached industrial scale. And to survive the winters, miners have to push cost out of everything they do. Traditional data centers also struggle with loads of 30kW or more, and many large operators will not underwrite crypto customers at all.
Data centers are classified in four tiers, and each step up adds redundancy and cost. His answer was what he called the tier zero data center. "And that's again, the tier zero, where we see cost being the name of the game, much more versus the redundancy." In a tier zero site the goal is to get the computing done on a best-effort basis, not to guarantee it. Energy, he said, is 80 percent of the company's operating cost, so Compute North went to the power source, avoided external cooling and kept overhead down.
His numbers: capital expenditure about 3 percent of a tier four data center, $150k to $250k per megawatt, with overhead under 5 percent and a much faster build.
Perrill saw uses beyond mining, in machine learning and deep learning training, rendering for films and online video, grid computing and storage, while saying AI itself was still a little far out at the time.
Compute North later filed for bankruptcy protection. Perrill now leads Backbone Digital.
When he spoke, Bitcoin traded at $9,770. Today it is $81,466.
The full story is on Intelligence Disrupt at intelligencedisrupt dot com, and many more like it play around the clock on Bitcoin Radio.