The negotiations between technical companies and cities to open new offices and / or data centers have long been behind the scenes. But that secret turns out to be a growing point, as evidenced by the Amazon's decision to leave plans for a major New York City campus, partly due to setbacks over how tight the e-commerce giant was in negotiating an incentive package with the city and New York State.
Now, new documents obtained by Washington Post show that Amazon is not the only company that favors secrecy – Google has also used confidentiality agreements in its bid to secure land for data centers, even go as far as creating companies to negotiate. The documents were first purchased by a group called Partnership for Working Families, which sues San Jose, California over non-revealing agreements the city has signed with Google.
The report comes after Google announced this week that it planned to invest $ 1
According to the record, Google used shell companies in negotiations with at least Five cities it ended up building data centers in. Sometimes it used several shell companies and negotiated with local officials using code names to avoid revealing that it was Google behind the project for several months in negotiations. Thus, they have done so, according to Post, who discovered through documents and an interview with Larry Barnett, president of an economic development organization in Midlothian, Texas, where Google ended up building a data center.
In Midlothian, for example, Google created Sharka to negotiate the tax reduction and site plans, and used its own Delaware company, Jet Stream LLC, to negotiate land purchase with a private owner. In Iowa, Google created Delaware-based Questa LLC for National Sales and Gable Corp for the Development Agreement.
When Google's representatives first approached midlothian in 2016, they used a code name that was not the same as one of its subsidiaries, Said Barnett. (He refused to say what it was.) Google also asked Midlothian officials to enter into a confidentiality agreement before they knew the identity of the developer, Barnett said. He said Google revealed its identity a year later, when the deal approached.
The story also contains links to non-revealing agreements. Google made officials log in to a number of cities, including Boulder, Colorado, San Jose and Clarksville, Tennessee
Google Spokeswoman Katherine Williams defended the company's actions in a statement to Post and said that Google uses "common industry practice".
"We believe public dialogue is important for the process of building new places and offices so that we actively cooperate with community members and elected officials in the places we call home. For one year, the data centers created $ 1.3 billion in economic activity , $ 750 million in earnings and 11,000 jobs across the United States, Williams says.
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Other Technology Companies, Including Apple, Facebook, Microsoft and Amazon often require secrecy for at least some duration of the process when negotiating new room land offers, including for data centers. It is hard to say how much more or less secret Google is compared to other companies. Apple and Microsoft have also used code names earlier when negotiating with local government officials they intend to build data centers in. In 2016, Facebook used a shell company called Greater Kudu LLC in negotiations for a New Mexico data center. In that case, the company behind the development was not disclosed to city officials until late in the approval process.
But what has gone for common industry practices lately cannot continue, especially as local groups have become more vocal about protesting the development of tech companies, such as Amazon's proposed campus in New York City. There, city council meetings met as the Amazon official often participated in protest societies' groups.
There is another instance where Google appears to be different from competitors: in some municipalities where data centers are built, Google has provided information on how much energy and water the data centers use as a trade secret. It is irked an eco-friendly group in South Carolina, who has been trying to get information on how many liters of water a Google data center in Berkeley County has used.
However, they know that the Google-created entity that owns the Datacenter is among the ten companies that use the most water in the county. The annual water consumption of at least some Facebook and Apple data centers has been revealed earlier, based on a quick search of local news articles.
VentureBeat has reached out to Google for further comment and will update this story if we hear back.