AMD Weighs Software Licensing Costs & Taxes In Data Center Consolidation Plan

AMD has six data centers around the world, but the company is trying to consolidate to just three. It’s not hard to imagine why this would be a good strategy--maximizing resources such as CPUs and server space and achieving optimal power efficiency with regard to electricity and cooling saves piles of money. Having half as many facilities to deal with could certainly make that an easier task.

However, one of the areas that AMD is apparently weighing heavily in its consolidation strategy is software licensing fees and associated taxes. The company’s 3,000 engineers use electronic design automation (EDA) software tools whose licensing fees are expensive, and apparently those costs differ depending on geographic location.

Further, AMD’s corporate vice president for global infrastructure services, Tom Painter, told PC World that "A lot of governments are looking at ways to exercise their taxing authorities” by collecting taxes on those licenses.

Assuming the aforementioned concerns played a role in this spring’s site selection, Suwanee, Georgia has acceptable tax rates. AMD is planning to build a 153,000 square foot data center there as part of its consolidation plan. The idea is to build the facility in “modules”, with the first module slated for completion in the second quarter of 2012, although the entire project could take around ten years to complete.