Facebook's Prineville, Oregon data center uses servers designed by Facebook itself. But they're built in China. Photo: Pete Erickson/Wired.com

Facebook is turning the server world on its head by going directly to Taiwan for custom-built machines. Except that it’s actually going to China.

Following in the footsteps of Google, Facebook is working with Taiwan-based outfits such as Quanta to design its own servers, but these machines are manufactured in Shanghai, on the Chinese mainland. According to Amir Michael — the Facebook engineer who oversees the design of these machines — the server market is gradually shifting from Taiwan to China, in much the same way it once moved from the US to Taiwan. Server manufacturing has already moved to the mainland, he says, and server engineering — the engineering operations that actually design the machines — is following.

“First, the manufacturing went from the US to Taiwan, and then the engineering went from the US to Taiwan,” Michael says. “Now, Taiwan has moved the manufacturing to China, and the engineering is moving there too. These things just leap-frog across the globe.”

And wherever it goes, Facebook is following.

Google, Facebook, and other giants of the internet demand something very different from the standard servers sold by the likes of traditional manufacturers Dell and HP. And because they purchase such a large number of machines, they can afford to design their own in tandem with original design manufacturers (ODMs) in East Asia. These ODMs are the same companies that build machines for Dell, HP, and other original equipment manufacturers (OEMs). In essence, Google and Facebook are cutting the Dells and the HPs out of the equation, causing a major shift in the market.

With Facebook “open sourcing” its server designs under the aegis of the Open Compute Project, giving them away to anyone who wants them, more and more companies are exploring this direct-to-East-Asia route, including not only large internet companies but also financial outfits, biomedical companies, and other outfits that require large numbers of servers. Goldman Sachs, for instance, is one of the big names leading the Open Compute Project.

For the past two years, Amir Michael and a handful of other Facebook employees have worked directly with engineers from several companies across the globe to fashion servers for use in the company’s data centers, rethinking everything from motherboards to motherboard fans to power supplies. Once these designs are completed, parts are manufactured in various locations in Asia and shipped to Shanghai. In some cases, these parts originate in Shanghai. Facebook works with the California-based Power-One to design its power supplies, for instance, and these supplies are built at facilities in Shanghai.

Once Facebook’s machines are pieced together, they’re shipped to a company in Fremont, California known as Synnex. Synnex spent thirty years buying and selling computer hardware across the globe, and in recent years, it has started working directly with internet giants such as Facebook and Rackspace. This year, the company created a new division, known as Hyve Solutions, to serve such “large-scale internet companies.” When Facebook’s servers arrive from China, Hyve technicians in Fremont slot them into Facebook’s custom-designed racks, plug in the necessary network cabling, test the machines, and then ship them to Facebook’s new data center in Prineville, Oregon.

“When you ship hardware, things break — on a boat, on a plan, on the railroad,” Michael says. “We want to do an extra test here in the U.S., right before we put them into the data center.”

The company may consider other distribution methods for other data centers, but for the Prineville facility — the first to use the company’s custom designs — Michael says it makes the most since to use a local “integrator” such as Hyve. “We’ve looked at several different business models for getting the servers into the data center. Going from our design to actually placing thousands of machines in the data center very quickly is hard,” he says. “Depending on the geographical location of the data, we may move to another model.”

Hyve Solutions says it will also work directly with internet outfits and other companies to design new servers. This is how Hyve works with Rackspace, a San Antonio, Texas-based company that competes with Amazon’s web services, offering up virtual processing power and storage space via the net. Rackspace requests certain designs from Hyve, and Hyve then work the ODMs to put the machines together.

Facebook released its first Open Compute server designs in April, and now it’s on the verge of releasing version 2.0. Prototypes have already been shared with companies interested in using these designs, including Nebula, a startup that’s selling appliances that run OpenStack, an open source platform that mimics Amazon’s increasingly popular EC2 and S3 web services.

According to Hyve, several companies have already placed ordered for the version 2.0 designs, including at least one big internet name.