The State of Utah has 22,000 employees working in the executive branch in roughly 30 agencies. We operate two primary data centers that house the mainframes and numerous smaller hosts. Still, many departments continue to operate "data centers" although most are merely machine rooms.
As I contemplate this situation, I'm left to wonder how many data centers a relatively small organization really needs. Companies larger than Utah and more spread out geographically (such as Siebel and Oracle) run all of their operations out of a single data center with provision for an emergency business continuity center (Siebel's production data center is, in fact, located in Utah). I constantly have people tell me that we couldn't possibly move their email server from their downtown building to the primary data center (both are on a fiber ring) and at the same time Oracle can somehow serve email to people in France (and elsewhere around the world) from a server in California.
Real data centers have conditioned air (temperature and humidity), conditioned power (including static protection, grounding, uninterpretable power supplies, back-up UPS batteries, and back-up generators), water detection, fire suppression, smoke detection, facility monitoring, physical security, earthquake safeguards, and so on. In addition to the physical facility, one must wrap the infrastructure in layers of process, including a 24x7 operations staff that monitors more than just ping and power. How can we possibly argue that we need more than a few such facilities for the State? How can we argue that critical production applications should be housed in anything less?
Most agencies will argue that due to their unique mission or some other special circumstance, they need to house their servers close to them. These are arguments that most organizations stopped listening to years ago. The real reasons are usually technical myopia or, more often, applications that were not designed with the network in mind. Until we stop making and accepting these arguments we'll continue to have multiple, expensive data centers spread around Salt Lake City, each housing a small cluster of servers. The citizens of Utah are poorly served by this strategy.