Here’s an interesting article in the BBC’s technical web section:
The gist is this – Iceland has more electricity than it can use, and its produced from geothermal, so there’s no carbon produced by making it. Plus, the cool temperatures can help keep all those servers cool with no air-conditioning costs. Iceland is busy laying fibre optic cables to North America and Europe so they can house big server farms and bring those jobs to the island. Seems like a good idea to us!