Selecting Your Data Center Part 1 – Understanding the Market

The data center industry continues to evolve with mergers, acquisitions, and a healthy crop of emerging companies. New data center products and services Old Data Centerare hitting the street, an aggressive debate on the model of selling space vs. power, and alternatives to physical data center space in the cloud are giving us a confusing maze of alternatives to meet our outsourcing needs.

The data center market is not unique. For example, in Southern California we have a wide variety of supermarkets and grocery stores including VONs, Ralphs, Albertsons, Jons, Trader Joes, Whole Foods, and lots of others. All grocery stores basically sell the same kinds of products, with very few exceptions.

What makes you go to VONs, rather than Whole Foods? Is it location? Prices? Image? A social issue?

The data center industry is not significantly different. In a city such as Los Angeles you have Equinix, Switch and Data, Savvis, BT Infonet, CoreSite, US Colo, Digital Realty, Level 3 – just to name a few. What makes one facility more attractive than another to fulfill your collocation needs?

Data centers, at the most common denominator, have traditionally offered:

  • Concrete (space for cabinets, racks, cages, suites, etc)
  • Power
  • Air conditioning
  • Interconnections

If all data centers offer the basic components listed above, then what discriminates the data centers from one another?

Now we can add additional alternatives to the basic data center model – the public cloud services provider/CSP and Software as a Service/SaaS.

As a potential data center tenant (this includes “virtual” data center tenants living in a CSP infrastructure) we have to evaluate all the above components, and determine which collocation or data center provider will best meet our facility, budget, and connectivity needs.

The Sense of Urgency

The CIO of the United States, Vivek Kundra, recently pressed the case for data center consolidation within the US government, as well as offering a strong recommendation that the US data industry strongly consider moving their operations into either consolidated data centers or virtualize within a cloud provider.

It is clear that data centers used by small and medium companies, as well as most content delivery companies, find better efficiencies in bringing their eCommerce and Internet-facing parts of their business into the data center, and locally interconnect with the Internet service provider community.

The cost of building a data center, providing staffing to manage the data center, and ensuring the efficiency of power and cooling usage is beyond the core competence of most companies. The need for disaster recovery plans, offsite storage, and other business continuity planning are just a few of the long list of items we need to consider as part of an overall information technology/IT or general business plan.

The potential waste of operational expenses, capital budgets, and resulting market “opportunity cost” justifies all companies at least consider outsourcing all or some of their IT operations – particularly as data center and CSPs increase their capabilities.

With the availability of netbooks, online applications (SaaS), and server-based office automation products, all companies should put this on their annual review list. Even the Los Angeles Police Department (LAPD) recently announced their decision to outsource the email to Google. This model does not appear to be going away anytime soon.

The “Selecting Your Data Center” Series

This series will walk through the process of identifying the need for outsourcing, identifying the best location for your data center, discriminating between the alternatives, and finally getting to your decision.

We welcome all comments, experiences, and discussions related to the data center community that would provide productive feedback for a potential data center or CSP tenant.

John Savageau, Long Beach

About johnsavageau
Another telecom junkie who has been bouncing around the international communications community for most of the past 35 years.

2 Responses to Selecting Your Data Center Part 1 – Understanding the Market

  1. Giles Proctor says:

    Hi John, am looking forward to reading this series, am sure it will be as insightful and thought-provoking as the rest of your blog. There is a similar push by government to consolidate and potentially outsource data centre requirements at both a state and federal level in Australia. See, for example, this article from yesterday: http://www.australianit.news.com.au/story/0,25197,26268194-15306,00.html

    Regards, GIles

    • johnsavageau says:

      Giles – thanks for the note. You are right, I should expand the series to include a much broader view of the data center industry.

      I think that virtualization and cloud computing is a very good potential alternative to in-sourcing data management, so reading through the Australian govt initiatives and policies will be good background for the larger issue.

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