While the Techmeme crowd oohs and aahs over the latest social networking knockoff from Silicon Valley – do you think, perhaps, we’ve reached the point of diminishing returns? – the real second generation of the internet continues to take shape quietly in places like Quincy, Washington; Lenoir, North Carolina; and San Antonio, Texas. Web 2.0 isn’t about applications. It’s about bricks and mortar. It’s about capital assets. It’s about infrastructure.

Yesterday, Google formally announced that, in addition to building a big utility computing plant in Lenoir, it will also build one a little to the south, at a 520-acre site in Mt. Holly, South Carolina, near Charleston. The company will be reimbursed by the state for some of its building expenses, and, the governor reports, legislators have “updated the state tax code to exempt the electricity and the capital investment in equipment necessary for this kind of a facility … from sales tax,” an exemption similar to one granted manufacturers. Google expects to invest $600 million in the facility and hire a modest 200 workers to man the largely automated plant. Google may also build yet another data center in Columbia, South Carolina.

At a pork barbecue celebrating the announcement of the data center deal, Google held a question and answer session with local dignitaries, but it was characteristically closed-mouthed about the details of its operation. Asked how it uses water and electricity at its sites, Google executive Rhett Weiss said, “We’re in a highly competitive industry and, frankly, one or two little pieces of information like that in the hands of our competitors can do us considerable damage. So we can’t discuss it.”

Meanwhile, one of those competitors, Microsoft, has just put into operation the first phase of a new data center in Quincy, Washington, not far from a recently built Google center in The Dalles, Oregon. A reporter from a newspaper in San Antonio, where Microsoft plans to build its next big center, got a sneak peak inside the tightly guarded Quincy plant:

The Microsoft building looks like a massive manufacturing plant, with a banklike security system. A perimeter fence and a security guard regulate who gets in and out. Inside the main lobby, employees need badges with radio frequency identification smart chips to enter. Even with a badge, they still have to go through telephone-booth-sized revolving tubes in which they insert their hand into biometric scanner to gain entry …

It’s easy to get lost inside Microsoft’s main building, which contains long halls with a tile floor and a maze of rooms centering around five 12,000-square-foot brain centers that contain tens of thousands of computer servers. Each server room has two adjoining rooms lined with refrigerator-sized air-conditioning units to keep the temperature between 60 to 68 degrees Fahrenheit. Another room contains row after row of batteries to kick in for 18 seconds if a power failure should occur before the truck-sized backup generators fire up.

The 470,000-square-foot data center is the first of an expected six centers that Microsoft will build on the Quincy site, a former bean field. The facility will ultimately encompass 1.5 million square feet of server-packed space. Nearby, Yahoo, Intuit, and Ask.com are also building big computing centers to power their online services. The attraction of the area is cheap power:

High-tech companies come here for the nation’s cheapest hydroelectric power rates, thanks to Grant County’s two enormous dams, which pump out power as cheap as 1.5 cents per kilowatt-hour, said Tim Snead, the city’s administrator. That compares with a national industrial rate of 9 cents. The data centers gobble up 40-plus megawatts of electricity each.

Now, you have to admit: this is a lot more interesting than Flackr or Knackr or Wankr or whatever the newest new thing is called.