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Data center operator credits Emerson equipment for getting it through blackout. Manufacturer expects to see rise in demand

By Gregory Cancelada

Equinix Inc. of Foster City, Calif., lives by Murphy's Law: If anything can go wrong, it will. Because Equinix's data centers and Internet-access exchanges serve companies like International Business Machines Corp. and Yahoo! Inc., it must ensure that its Internet infrastructure works even when the power fails.

So when the New York area lost power Thursday, Equinix's centers in Secaucus, N.J., and Newark, N.J., were prepared, said Margie Backaus, chief business officer at Equinix. The company's complex system of uninterruptible power supply, or UPS, systems, backup batteries, power-transfer switches and other electrical equipment protected the centers and allowed continuous operations despite the outage. Aided by its own generators, "We had zero interruptions," Backaus said. "Absolutely none." Backaus credits this seamless operation to equipment built by Emerson, the Ferguson-based manufacturer of control systems, electronics and electrical products. The Emerson Network Power division offers UPS systems, power-transfer switches, power-distribution and -switching systems, battery systems, generator alternators and other equipment needed to protect computer and telecommunications networks and to provide backup power. An Emerson UPS system helped provide backup power for the New York Stock Exchange, allowing its computers to run without disruption.

Now Emerson may see greater opportunities after last week's massive outage left millions of people without power and many businesses paralyzed. Indeed, the outage has eroded confidence in the country's aging power system, and as a result companies will start re-examining their power needs, analysts said. "It's a wake-up call for many people," said Farah Saeed, a power-industry analyst at consulting firm Frost & Sullivan, based in New York. "A lot of people take power for granted." Emerson isn't expecting a big spike in demand, because of the complicated and expensive nature of such systems, said Robert Bauer, president of Emerson Network Power Systems-North America. "The type of system that you're talking about is not the type that you plan for in a week's time," Bauer said. "You really have to go in and analyze what the power systems looks like, what the backup needs are."

But Emerson has gotten more inquiries from customers and potential customers wanting to beef up their power systems after the outage, and Bauer expects to see more demand for these kinds of products. "Exactly how big that will be is hard to tell, but there (are) certainly more people thinking about the need for (backup power) today than two weeks ago." Analysts agree that the power failure will spur companies to spend more money on backup power. The costs of such installations typically aren't made public. Saeed said, "Incidents such as what New York faced last week make people realize they have to be on top of their power-backup needs, power infrastructure." In the past two years, many businesses have held back spending on their power infrastructure to save money, Saeed said. "This is going to make people upgrade their systems." Growing demand for such equipment won't come only from companies like Equinix, whose "hardened" facilities are among the most extreme examples of power preparedness.

Increased dependence on information systems and the Internet is forcing many companies to conclude that they need backup-power systems. "Even in those companies who are not going to spend a huge amount of money on backup-power infrastructure, many of them are now running with information-technology systems that provide a great source of productivity and connectivity to their customers," Bauer said. "If you lose that, you're in trouble." At the same time, Emerson's network-power service business, which provides maintenance for backup-power systems, is seeing increased demand from businesses suddenly wanting to check installed equipment and ensure that systems will run.

"Certainly, one of the things proved through this outage is that these kinds of systems work," Bauer said. "For those people who have invested in them, certainly the NYSE, they probably paid for their systems that day."