Microsoft and Yahoo choose Port of Quincy for new high tech data centers

March 2006

A high-tech boom is taking place in Quincy, Washington.

Technology giants Microsoft Corp. and Yahoo Inc. are planning to build massive data storage centers amid the sagebrush and farm fields of rural central Washington.

The draw appears to be the region's relatively cheap land, inexpensive hydroelectric power, state-of-the-art fiber optics, and wide-open space.

The developments come as Microsoft, Yahoo, Google Inc. and Time Warner Inc.'s America Online, as part of efforts to compete for customer loyalty, are boosting e-mail, video and other services that require lots of storage space.

"Data centers like this are what contains the family jewels," analyst Rob Enderle said. "They're looking for low-cost real estate and stable sites in terms of weather and geographic activity. It means they've done some work and determined it's one of the least-expensive, safest places they can build."

Quincy, population 5,300, has long been an agricultural hub in Washington. Trains carry railcars loaded with apples, potatoes, onions and hay to points both east and west, and food processors and packing sheds comprise most of the city's industrial base.

The city sits hundreds of miles from Microsoft's lush Redmond headquarters near Seattle, yet the Fortune 500 company has signed a tentative agreement to buy 74 acres in one of Quincy's five rapidly filling industrial parks. The price: $1 million.

"The Quincy area is attractive to Microsoft for a number of reasons: space available, the land, the access to power and fiber optics, and the close proximity to our headquarters here, which is always good for us," Microsoft spokesman Lou Gellos said by telephone from Redmond.

One of Microsoft's rivals, Yahoo, also has signed a tentative agreement to purchase 50 acres in another industrial park in Quincy. The company, based in Sunnyvale, Calif., has until the end of April to seal the deal for $500,000.

The company also has signed a 10-year, roughly $6 million lease to set up a separate data center in Wenatchee, about 30 miles away.

Port of Quincy President Curt Morris estimates the two companies could double Quincy's tax base, currently at some $800 million -- providing valuable money to local schools and the city's hospital. And that doesn't include high-tech suppliers that might choose to relocate there, too, he said.

"Quincy will always, I think, have the roots of being an ag town, because of the industries that are already here," said Morris. "It's going to be interesting to see how Quincy changes from what has been a straight ag industry town, to see what it can become in the next five years."

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