Apple’s billion dollar baby

The plus side to newspapers on the Web: a local story gets worldwide attention. So it was with this piece, an AP story, that ran in the Charlotte Observer. It had to do with a tax incentive being offered to Apple in return for building a massive datacenter.

Needless to say, it got my attention

The angle for the Observer was the whole tax break element and the argument it would bring jobs to the state (“jobs” as in employment, not him.). But for someone like me, that raises all kinds of other questions, starting with what is Apple planning?

The AP reports Apple is looking to make a $1 billion investment in a server farm, which is pretty hefty. Microsoft was looking to build a $500 million datacenter in West Des Moines, Iowa, and the company cancelled that due to the economy (much to the dismay of Iowa’s governor).

The center would be based in either Catawba and Cleveland counties in the western part of the state, which is pretty far from the state’s tech hub in Research Triangle, which is in the Raleigh-Durham area miles away.

Western North Carolina is an ideal spot for a datacenter, as Google figured out when it built a $600 million facility. Land is cheap and they can get alternative power from the Tennessee Valley Authority (TVA). Google is pretty obsessed with that and often puts its facilities where it get hydro and wind power.

The state figures Apple will get about $46 million in tax breaks over the next decade, assuming the company reaches its $1 billion investment target within nine years of starting, according to the article. The facility will employ about 100 people, hardly huge in a state with 10.8 percent unemployment, but there are other benefits to the state.

The real question is what they are going to do with a datacenter that big. Apple is talking about building a facility twice the size of the kind Microsoft and Google use. Logically, you have to figure it is expecting some kind of massive growth in the near future. iTunes isn’t that popular and App Store, while hot, certainly couldn’t require this kind of capacity.

You can bet there will be a lot of attention paid to the vote when it comes up before the full House in Raleigh this Tuesday.

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