Verizon Wireless to open Springs data center in retrofitted computer chip plant

Verizon Wireless has acquired the former Vitesse Semiconductor Corp. chip plant near Garden of the Gods Road to convert the vacant building into a data center to help manage the telecommunication giant's next-generation network.

The 108,450-square-foot building will undergo an extensive year-long renovation before beginning operations in early 2010 with 10-15 technicians and engineers, said Bob Kelley, a Verizon Wireless spokesman in Denver. The center is part of Verizon's plan to boost download speeds on its U.S. network by two or three times to allow its 80 million customers to view streaming video broadcasts, he said.

"We were originally planning to build the center on a site in the Denver area, but as we began to investigate the available existing properties, we found it was more cost effective to buy and retrofit an existing building," Kelley said of the six- to eight-month search. "There are a lot of good properties on the market that could be converted cost effectively for our needs, and we found such a property in Colorado Springs."

Verizon Wireless paid $6.4 million on Dec. 22 for the former Vitesse plant, according to the El Paso County Assessor's records, or less than one-fourth of the $27.5 million Vitesse paid for the building in 2002. The plant was built in 1997 for Vitesse and housed about 200 employees at its peak to make ultra-fast gallium arsenide chips before closing in 2003. A small design operation remained in the plant until 2007.

Verizon's Springs center will manage the company's wireless network in the western U.S. and will be the company's seventh such facility. Data centers house large computer systems and servers that store massive amounts of data or operate large communications networks. The centers often include backup power generators and communications lines as well as raised floors to keep computer systems from overheating.

"This is an important addition to our community. The opening of the data center further solidifies Verizon's presence in our community, and our experience reflects that when a company invests significant funds in a data center they are more likely to stay in the community for a significant period of time," said Mike Kazmierski, president of the Colorado Springs Regional Economic Development Corp.

The new center will be just across 30th Street from a major information technology operation for Verizon Business, an affiliated unit of Verizon Communications Corp. with 1,750 employees and contractors. Verizon Business is trying to lease some of the office space of the 800,000-square-foot complex. To put the data center in that building would have required more extensive and costly retrofitting than the Vitesse plant, Kelley said.

Verizon Wireless, a joint venture of Verizon Communications and Vodafone Group Plc, is the nation's largest cell phone carrier with 80 million customers generating nearly $50 billion a year in revenue.
The company operates five retail stores in the Springs with 50 employees. Verizon last month acquired Alltel Corp. for $5.9 billion and took on $22.2 billion in Alltel debt in a deal that added more than 10 million customers.

Last year, Verizon Wireless spent $94.5 million beefing up its network in Colorado Springs, Denver and the Western Slope with 30 new cell towers and improvements to existing towers to expand its capacity and increase download speeds.