FORTUNE -- The next time you upload a photo to Facebook, consider this: All those pictures have to be processed and stored somewhere, presumably forever. Some 3 million data centers occupy more than 600 million square feet of space in the U.S. alone to help do so. Trouble is, a single location can slurp as much power as a medium-size town, or about 10.5 million watts, according to Jonathan Koomey, a researcher at Stanford University. Data centers already account for 2.2% of America's total electricity consumption. That is making for hefty utility bills at firms that rely on them -- especially data-heavy web services such as Amazon (AMZN) and Google (GOOG).
The culprit for this surge? Smartphones. High-end devices like the iPhone have already outnumbered traditional cellphones in the U.S. this year, according to Nielsen. Users have flocked to data-intensive activities like sharing high-resolution photos and video, surfing the web, and downloading apps. Hence the boom in power-hungry data centers.
In an unexpected twist, smartphones may be the answer to the problems their very popularity helped create. Chips once found exclusively in cellphones are making their way into the building blocks of traditional data centers, like servers. It turns out that such chips may be particularly well-suited for today's high-frequency, in-the-cloud computations -- the billions of Internet searches processed each day, for example. They also consume less energy than traditional server chips -- one-tenth as much, in fact.
Chipmakers, meanwhile, are positioning themselves to find new, lucrative lines of business as PC sales decline and mobile devices increasingly dictate trends. The traditional server market reached $52.8 billion worldwide last year, according to research firm Gartner. In November, longtime Intel boss Paul Otellini announced he would step down in early 2013, making way for a new chief executive to deal with the dicey transition to lower-power chips.
U.K.-based ARM Holdings (ARMH), which licenses its popular processor architecture to mobile-chip manufacturers like Qualcomm (QCOM), has ramped up efforts to get its designs into data centers dominated by Intel (INTC). ARM's microprocessors are currently found in more than 90% of all smartphones. But the company recently announced a so-called 64-bit version, a signal to engineering types that its devices can handle large amounts of memory -- key for use in data centers.
Major companies like Advanced Micro Devices (AMD) and Hewlett-Packard (HPQ) are turning to such designs as well. AMD is expected to ship its first ARM-based products in 2014. Smaller players are joining in too: Austin-based startup Calxeda is focused on selling to financial services and cloud-computing providers like Rackspace as well as social media companies -- large companies with large data centers. "Their power bill is excruciating," says Karl Freund, Calxeda's vice president of marketing. (Calxeda has over $100 million in backing from the likes of Highland Capital Partners and Battery Ventures.)
Even Facebook (FB) -- known for assiduously custom-designing its data centers from the ground up -- has tested the use of alternative chips in servers. "As more and more of what we do shifts to the cloud, more and more companies are seeing the future value in this technology," notes Jay Parikh, Facebook's vice president of infrastructure engineering.
Still, data centers aren't likely to change overnight. Server software providers, for one, will have to be goaded into rewriting their code so that it is compatible with ARM's technology. That may prove costly and time consuming until chips designed by the company are widely used.
The biggest difficulties may come from chipmakers themselves. Already, Intel and rival ARM are squabbling. Intel claims ARM licensees are targeting just 10% of the overall server market -- a segment known as "microservers." ARM says that's not so. It counters it will own 20% of the total server market by 2020. Of course, Intel has its own road map for lower-power chips, for both mobile and server markets. "Intel is huge and very powerful, and they own 95% of the [current server] market," concedes Calxeda's Freund. He believes customers want more choices.
Whichever camp wins -- ARM or Intel -- lower-power processors will make their way into data centers during the next few years. Another thing is for sure: The number of smartphones will continue to explode. That makes it unlikely anybody will stop uploading photos to Facebook -- and driving even more traffic to server farms -- anytime soon.
This story is from the December 24, 2012 issue of Fortune.
For reasons unclear, the online store was not responding Wednesday morning
[UPDATE: As of 11:10 a.m. EST the store seems to be functioning properly. No new products that I can see. Never did get an explanation from Apple PR.]
[UPDATE 2: As of noon EST, the site seems to be misbehaving again. Still no word out of Apple.]
[UPDATE 3: Reader Mehdi Daoudi of Catchpoint Systems reports that the site had fully recovered MOREPhilip Elmer-DeWitt - Aug 17, 2011 9:51 AM ET
One of the mysteries surrounding the 500,000-square foot server farm Apple (AAPL) has famously constructed in a small North Carolina town called Maiden -- besides its ultimate purpose -- is why it didn't show up on Google Earth.
We knew what it looked like, thanks to the local Fox TV affiliate, a trespassing photographer and a local real estate agent who conducted a couple of video flybys that ended up on MOREPhilip Elmer-DeWitt - Jun 1, 2011 6:46 AM ET
Inside this nondescript warehouse, perched along Oregon's Columbia River, computer networks respond to millions of commands instantaneously. Search for "pants size 12" or "mermaid parade," and your results will race through a Google data center like this -- and then right back to you. How much does it cost now to build a complete data center? Roughly $479 million. --Tara Moore
7.5 million is the number of data centers around the MOREMay 23, 2011 5:00 AM ET
The new facility in Santa Clara will grow to 3/4 the size of Apple's North Carolina data center
In what could be a new sign that Apple (AAPL) is stepping up its efforts in so-called cloud computing, Data Center Knowledge reported Wednesday that the company has signed a long-term lease for several megawatts of critical computing power from a data center under construction in Santa Clara, Calif., less than 10 miles MOREPhilip Elmer-DeWitt - May 18, 2011 3:56 PM ET
An analyst imagines everything it might be when -- and if -- it opens this spring
Among the people who follow Apple (AAPL) closely, the massive server farm the company is constructing in Maiden, N.C., has achieved near mythic status. It has become the answer to every unanswered question about Apple's troubled online strategy, from what Steve Jobs was thinking when he green-lighted Ping to how MacBook Air users are supposed MOREPhilip Elmer-DeWitt - Mar 23, 2011 6:13 AM ET
Could Tuesday be the day Apple (AAPL) lights up on its billion-dollar server farm in North Carolina, launching its entry into cloud computing? That's what the big tease that appeared on the front page of Apple.com Monday morning suggests. [UPDATE: See One more time: The Beatles on iTunes? and Behind the Beatles-iTunes deal.]
Among the threads that seem to be coming together this week:
The 500,000-square-foot data center in Maiden, N.C. -- MOREPhilip Elmer-DeWitt - Nov 15, 2010 11:01 AM ET
Its Maiden, N.C., data center, said to be doubling in size, is still not visible on Google Maps
How is that the only photographic evidence that Apple (AAPL) is building a giant data center in western North Carolina is a video fly-over shot eight months ago by a Charlotte real estate agent and a snapshot that appeared in the Hickory Daily Record three months earlier?
[UPDATE: There's a new flyover! Shot by MOREPhilip Elmer-DeWitt - Oct 27, 2010 11:01 AM ET
The 500,000-sq.-ft. facility is nearly five times the size of Apple's current server farm
Bill Wagenseller, an aptly named real estate agent based in Charlotte, N.C., has posted what is believed to be the first video flyover of Apple's (AAPL) billion-dollar server farm, now under construction 40 miles away in Maiden, N.C.
According to Data Center Knowledge, which spotted the 36-second video, the massive, 500,000-sq.-ft. facility will be nearly five times the MOREPhilip Elmer-DeWitt - Feb 22, 2010 3:23 PM ET
|The medical marijuana ad that never aired, despite contrary media headlines|
|The bull market at 5: Not old yet|
|Boeing reports wing cracks on Dreamliners|
|China to fight pollution with drones|
|2 million students missing out on college aid|