Where the cloud clusters: A global spatial analysis of data centre locations and their determinants

Source abstract

Data centres are the physical backbone of the digital economy and one of the world's fastest-growing infrastructure classes. Their siting places new demands on land, electricity, water and skilled labour. Place-based policies such as the UK's AI Growth Zones and China's ‘Eastern Data Western Computing’ programme seek to attract, steer or restrain this development, yet the evidence base on what drives location choice is thin. This paper models the spatial determinants of 5821 data centres worldwide using an inhomogeneous Poisson point process combined with density-based clustering (DBSCAN). Data centres are highly concentrated with 76.2% inside 258 clusters at a median nearest-neighbour distance of 0.86 km. Each standard-deviation increase in distance from the nearest airport, city or observed cluster reduces expected density by 46.9%, 43.5% and 23.5%, while geopolitical stability raises it by 16.2%. Submarine cable proximity is weak, and renewable electricity share does not predict location once other factors are controlled. Climate runs counter to expectations. Warmer places with greater cooling costs host more facilities. The results extend the agglomeration thesis of economic geography to the compute layer of the digital economy. For governments that wish to host data centres, cluster-affirming strategies aligned with urban hierarchies, airport access and stable institutions run with the grain of revealed preferences, whereas dispersion strategies premised on cool climates or renewable-rich peripheries face structural headwinds. Findings apply chiefly to multi-tenant colocation facilities, and hyperscale campuses are under-represented.