Right now, there’s dizzying growth in mobile Internet use and cloud computing. According to recent studies, there will be 1.1 billion smartphones sold globally by 2013 and today, nearly a third of Americans are accessing the Internet via mobile devices.
And leading the way in mobile web browsing are iPhone users: Industry reports estimate that “iPhone users spend 300 percent more time accessing the Internet than typical smartphone users, while requiring 40 times the bandwidth of a traditional cell phone, and 10 times the bandwidth of a BlackBerry.”
All of that usage requires efficient and reliable power — and the need to lower utility costs and reduce cooling requirements in the data centers that fuel them. With its ecomagination technology that helps these data hubs use more efficient direct current rather than alternating current — and investments in companies such as Synapsense — GE is already in the data center efficiency space. But one of the key players operating much deeper in that arena is privately-held Lineage Power Holdings, which traces its history back to Bell Labs. Today, GE announced it has signed an agreement to buy the company for approximately $520 million.
Lineage, which projects revenues of around $450 million, is a global leader in the technology that helps data centers and telecoms efficiently convert power to DC and use it more efficiently — thereby keeping the electricity “always-on” for consumers and reducing spiraling energy costs for the centers. When it closes, the deal will open the door for GE Energy technology to be deployed in the $10 billion dollar space known as “micro-power conversion” — which is the epicenter of energy use for all of today’s new wireless voice, video, and data technologies.
As Dan Heintzelman, CEO of GE Energy Services, told Bloomberg News this morning: “We have a broad portfolio of energy products and technology ranging from the power plant all the way through the grid and down to the building. This gives us strength now on the inside, in data centers, power conversion and software.”
While the need for smart power management is already critical, the growth is expected to continue upwards as more uses are found for wireless devices (there’s even a “robotic ball” that’s controlled by a smart phone that was unveiled at the Consumer Electronics Show, paving the way for new games — and even more power usage).
As Vito Savino, Director of Product Management for Lineage, wrote in industry watcher OSP Magazine: “Make no mistake: the large data centers required to keep subscribers’ telephones ringing are massive consumers of energy; some reports have this rate at 2 percent of the planet’s entire electricity supply. The average energy bill for a Fortune 100 telecom’s data center is a whopping $10 million per month. Furthermore, these large carriers are currently spending in the range of $1 billion per year solely on cooling costs for these centers… It’s about much more than being able to tout that you run a Green telecom organization: it’s about saving millions of lost dollars that could be re-appropriated toward expanding infrastructure and keeping consumers satisfied.”
Plugging in: The move will allow GE Energy to further expand its end-to-end technology, which will run from utilities and electrical grids down to data centers, cell towers, servers and circuit board electronics. It’s latest in a series of deals to expand GE’s $40 billion energy portfolio. In October 2010, GE announced the signing of a contract to acquire Dresser Inc., a Dallas-based energy infrastructure company. Last month, the company announced its intention to make an offer for 100 percent of Wellstream Holdings PLC, a British oil pipe manufacturer. Photo: Wikipedia commons license.
* Read today’s announcement
* Read coverage by Bloomberg News
* Learn about GE’s investment in Synapsense, which optimizes data center efficiency
* See GE’s John Krenicki discuss the deal on CNBC
