Why you should opt for an external data centre: 10 no-brainers LCL WHITE PAPER. LCL, your partner in data center outsourcing 1

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1 Why you should opt for an external data centre: 10 no-brainers LCL WHITE PAPER LCL, your partner in data center outsourcing 1

2 A data centre, even a small one, is a huge investment for any organisation. It would therefore be a logical choice for most companies to opt for an external data centre. And yet there are countless organisations that still prefer to keep their data and applications within their company walls. Sometimes this is a deliberate and motivated choice, driven by realistic economic and/or strategic reality. But for many companies, the choice could have been different if they had taken into account all the relevant arguments. That is why we have decided to draw up a list of obvious reasons to opt for an external data centre instead of investing in your own infrastructure, and to discuss some arguments that are often used against external data centres. But let s start with the arguments in favour of an external data centre. 1. Ease of mind CIOs and IT managers have a very wide knowledge span: from servers to mobile phones, from apps to mission-critical infrastructure. But data centres require an entirely different knowledge and expertise. Building a data centre, managing the infrastructure, cooling, UPS, batteries,... all of these elements require specific skill sets which do not belong to the traditional ICT manager knowledge. Sometimes this is referred to as the layer 0 of the OSI model or the ground level, whereas ICT managers tend to look at the picture from layer 1 upwards. Outsourcing your data centre therefore means getting rid of a lot of worries: you don t need to invest time and money in acquiring all those skill sets and knowledge, and in finding reliable staff who can keep the data centre running 24/7. Saving all that time and energy also means you can focus better on your core, value-adding ICT activities. 2. Avoid capital expenditure (capex) Companies are seeking to avoid capital expenditure, especially when it concerns activities that are only indirectly contributing to the bottom line revenue. Especially in periods of economical crisis and an uncertain future, like the last few years, companies are more reluctant to invest heavily in a scenario that implies a long-term growth, which cannot be guaranteed at all. Will the investment provide a return, even in the long run? How can we calculate the ROI of the investment? Faced with these questions, most organizations LCL, your partner in data center outsourcing 2

3 will realize that the choice for an external data centre is the most viable one, both financially and economically. 3. Staffing Years ago, companies could afford a data centre outage, even if it lasted for hours. Nowadays, even the slightest downtime will severely upset the company s activities and impact its bottom-line. Managing such a business-critical environment requires highly qualified personnel. And you need lots of them, because the data centre needs to run 24 x 7, all year long, which means having people in the data centre and on call day and night. And these specialists can obviously also leave the company, which means you need to start all over again. Not only is it increasingly difficult and time-consuming to find and/or train qualified personnel, you also need to pay them to watch over only one environment. External data centres can spread this effort and investment over many customers, which makes it a lot more affordable. 4. Flexibility Building or expanding a data centre is a tricky exercise. It is hard to predict how your company s IT requirements will evolve in the next few years but planning for a data centre requires just that: you need to estimate how many servers you will need three to five years from now, how much power these servers will consume, what the effect of virtualization will be, etc. This requires not only a correct estimate of your company s business evolution but also of the technological evolution. Outsourcing this problem to an external data centre makes a lot more sense: their scope of server activity and being able to spread it over several customers allows data centre operators to offer a real win-win situation. To maintain datacenter profitability while offering a maximal flexibility to the customer, at an appealing price, THAT is our ultimate goal. 5. Connectivity Companies that are running their own data centre, face an additional problem, related to connectivity. In normal circumstances, one tries not to become dependent upon one provider, and to compare prices between competitors, not necessarily in order to switch providers but at least to put the current provider under a healthy amount of pressure. But for most companies data centres this is not an option: as there is only one network and telecom provider available in that area, one can simply not choose. LCL, your partner in data center outsourcing 3

4 An external data centre such as LCL does not face this problem: we can provide the customer with a wide choice of telecom operators, so that they can either opt for the best price or the best quality or the best combination of both. Additionally the size of an external data centre usually allows us to bargain for better deals than a company running just their own servers in their data centre. And it is easier to switch to a higher bandwidth if needs be. And finally, opting for an external data centre also provides you with the security that only a redundant network and telecom environment can offer: if a cable gets damaged by e.g. construction works, the internal data centre will probably go down. Our external data centre will immediately switch to a secondary line, and thus ensure an uninterrupted connectivity. 6. Power supply The last couple of years, we have witnessed an increasing amount of power network outages. Several factors, such as the increasing trend of power consumers also becoming power suppliers or the recent unavailability of several nuclear plants, have increased the risk of interrupted power supply. Data centre owners need to prepare for such power outages using larger batteries and UPS infrastructure. Once again external data centres can better prepare for such emergencies: the size of the data centre infrastructure allows them to invest in the most reliable power supply backup. 7. Sustainability A recent study by research institute Vito has proven that a majority of the server rooms and data centres are very energyinefficient. Sometimes the PUE (power usage effectiveness, a measure of how efficiently the power is used for actually powering the servers and not the cooling devices or other elements of the infrastructure) exceeds the value of 3, which means that for every amount of power used for computing, twice this amount of power is used for other functions. Often this results from a combination of sub-optimal data centre design, not following best practices and never questioning any of the above afterwards. Any company that aims to improve its efforts towards reaching a sustainable environment, should seriously consider outsourcing its data centre. Not only is it more environment-friendly, it will also greatly reduce the amount of energy needed to keep your servers running, and therefore significantly lower your energy bill. And this energy bill will form an increasing percentage of the overall company spending throughout the coming years, LCL, your partner in data center outsourcing 4

5 nobody will argue with that. It comes as no surprise, then, that Vito has concluded in the abovementioned study that moving your data centre from within your company walls to a third party will significantly reduce the amount of energy needed to run the same number of servers. 8. Physical security Information theft is one of the fastest growing forms of business criminality. Any company with its own server room or data centre knows what sort of problems one can face. One needs to set up a policy for accessing the data centre which is not too rigid but covers all risks. One needs to know who has entered the server room or data centre when a breach has occurred, ideally using video images made by motiondetecting cameras. This requires a lot of specific knowledge and tools, and a significant investment best left to specialists, and therefore usually to external data centres. 9. Upfront investment Data centres are a financial liability. You need to provide a lot of overcapacity just in case your company should grow at an unexpected pace. But on the other hand: unused space is a very expensive asset. Finding the right balance between overspending and being faced with a shortage of power, cooling or space is a very difficult exercise and companies get it wrong more often than right. When outsourced to an external data centre you get rid of this hazardous exercise and you leave it up to an organization that spreads this liability over many parties. 10. Maintenance is no child s play Problems within a data centre are usually caused by a human mistake. One cannot begin to imagine how often people are walking through the server rooms carrying buckets of water! You should try to minimize the number of human errors. With every move you make, every action you take, you should think about the possible impact on the data centre, and what will happen if it causes a power failure. Similarly, switching electric power transmission requires trained personnel and it requires at least two persons. Investing in a reliable maintenance team takes a lot more than you would believe at first. Once again this is more affordable for an external data centre due to its size and number of customers. LCL, your partner in data center outsourcing 5

6 Counterarguments countered Of course there are also reasons to keep your data centre inside the company premises or to build or maintain your own data centre. But they are not always a reason to exclude external data centres. Let s have a look at some of the most commonly heard counterarguments. 1. We already have a data centre Usually followed by...and it contains all my company s knowledge and knowhow. That may be a valid argument for some companies but maybe they should also consider the fact that every data centre is ideally replicated to a remote environment, where my data can be retrieved very fast in case of disasters. At that point, considering an external data centre is the least you can do. 2. Everything ends up in the cloud anyway Of course this is no reason to avoid external data centers. Most of the clouds used by companies will be private clouds, which can perfectly be managed and maintained by external data centres. Even combining this private cloud with a public cloud is better left to external data centres which are highly experienced with such environments. 3. My data cannot leave the country This used to be a very valid reason not to outsource: many data centre and cloud providers could not guarantee that your data would remain within the country borders. But nowadays the larger data centre service providers such as LCL are sufficiently developed, with several remote sites, to guarantee a fully replicated environment without ever leaving the country. 4. External data centres are far too expensive Data centre providers can provide you with a very transparent and comprehensive overview of the costs, accounting for the monthly charge. This may seem very high at first when compared to your own calculation of your own data centre costs. But you should carefully consider the hidden costs when comparing: does your data centre contain the same infrastructure as the external data centre provider? Do you have a reliable cooling and UPS infrastructure that remotely resembles the external data centre s? Did you add the power supply bill? Did you take the personnel costs into account? In a related white paper (***add title later***) you can read more about the hidden costs that are often forgotten when comparing an internal data centre with an external one. LCL, your partner in data center outsourcing 6

7 5. I ll just put it at the back of the office space All too often this is what actually happens. Companies start with one or two servers somewhere at the end of the office building, and before they know it, this room is filled with too many servers. Too many, because it is not just a matter of filling the room until there is no space left. Firstly, a room filled with servers will probably also be filled with too much heat emanating from processing activity, leading to regular power failures and eventually server breakdowns. Secondly, a regular office floor is designed for regular office activity, not for data centre or server room activity. A data centre floor typically is designed to carry a server rack load of kg per m², whereas the vast majority of office floors will not be able to carry such load. And, last but not least, the amount of electricity needed to keep the servers and infrastructure powered exceeds the average office needs by far. A typical data centre requires W per m², many times the amount an average office would need. All these reasons lead to the same conclusion: what looks like a good business decision at first may eventually lead to the most dramatic catastrophe your business can experience. So, even if you start out with just one or two servers, please take care that you don t take the decision to outsource your data centre too late. LCL n.v./s.a. Kouterveldstraat Diegem - Belgium TEL FAX LCL, your partner in data center outsourcing 7