Risk Management Solutions, a cloud service provider for businesses in the insurance and re-insurance industry, knows a thing or two about risk analysis. So it was a surprise for some when the Silicon Valley firm, with offices in nine time zones around the world, decided to build its global data centre in Iceland.

Many were puzzled especially since the decision came not long after the Nordic country’s
Eyjafjallajökull volcano erupted and the nation was mired in a serious financial crisis that saw all three of its national banks collapse, according to John Standford, director of cloud architecture and engineering for RMS.

RMS opened in September 19 its RMS Cloud environment in some 45 minutes from the country’s capital Reykjavík. The 17.8-hectare facility is in the site of a former NATO command centre.

That says a lot about the security of the location, said Lisa Rhodes, vice-president of corporate strategy and market development with Verne Global, which owns and operates the facility.

If NATO’s deemed it suitable for storing missiles then it must be good enough for a data centre, she said.

Stanford said in order to attract foreign businesses, Iceland’s government charges no value-added tax to companies operating in the country.

The country is also encouraging such companies to partner with Icelandic firms. Stanford finds this beneficial for RMS because Iceland has a highly educated workforce.

The location also puts the RMS data centre in close proximity to Amazon Web Services’ data centre in London and Dublin. The island also has redundant cable links to Europe, Boston which is good for latency, said Stanford.

Other positive factors in favour of the locations are:

  • Iceland claims consistent temperatures all throughout the year
  • Close proximity to North America and Europe
  • New power grid and steady supply of renewable energy (geothermal, hydroelectric and solar)

Even if there is another volcanic eruption, prevailing winds will blow the ashes towards Europe, said Rhodes.

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