D ATA CENTRES
How the cloud is making technology invisible to users Invisible data centres by Neil Cresswell, CEO of Virtus Data Centres
There can be no doubt that businesses are moving in their thousands to various forms of cloud-based computing. We experience this at Virtus and it is regularly reported in shareholder statements of similar large data centre operators. Leading the charge is an army of small and medium sized enterprises (SMEs) for whom the stress and pressure of installing and operating their own servers is a non-core task they are only too keen to offload. After all, they rarely have a full time
Neil Cresswell details his next-gen data centre strategy...
server expert in-house and can see immediate benefits in outsourcing the hassle to trusted brands like Microsoft, Sage and
Salesforce.com. In the minds of SME business owners
these big brands have far more expertise and can afford to provide far more resilience, reliability, high bandwidth and well-trained operational staff. This means that SME business
owners believe they will have far fewer problems and lower costs. And they are right. Not only do these big brands have
the staff and the expertise, they nearly all run their cloud-offerings from high quality Tier III colocation data centres. This might surprise some readers who thought that the big brands own
their own data centres – a small number do indeed own some of their data centres, but most now realise that as they grow their international businesses they need to have computing power on the doorstep of the major populations they serve.
And the only way to do that
economically is to take space in high quality colocation data centres around the world. For example there are around 20 cloud and managed service providers (MSP) hosted at our own LON1 data centre. A recent report shows that pretty
much all of the 100 top cloud service providers globally use third party data centres to deliver their services.
Slow but sure Larger businesses are slower in their move to cloud-backed services. Of course it’s a more complicated process for them as they have both legacy IT systems and in-house expertise. But there is still a significant move towards outsourcing to MSPs who locate their equipment in high quality colocation data centres. Will the move to cloud-backed
services actually cause the colocation
sector to grow? Most definitely. Let’s just consider SME businesses in
the UK – there are 4.8 million of them. Even taking account of virtualisation and cloud efficiencies, the colocation market is still going to have to provide one to two million servers-worth of compute power to service these customers as they ditch their servers and switch to cloud services. And the majority of those servers will
need to be housed in high quality UK colocation data centres - predominantly in London and the South East of England where two thirds of these businesses are located. Of course, when it comes to
providing cloud services to large businesses, the number of customers is far fewer – but the compute power requirement is in a far bigger league. On a technical front this is to avoid
excessive use of international bandwidth and to reduce latency to acceptable levels.
On the emotional front, many
customers want the assurance that their essential operational data is in the same legal jurisdiction as their business. These and other similar factors have all made the big cloud service providers move to a multi-local third party colocation data centre model.
The new colocation strategy Of course not all cloud providers are massive and few start out that way. Unfortunately the conventional CoLo
leasing model is a very poor fit with the business model of cloud service providers. The conventional CoLo business
model is based on long leases of three, five or even ten years for a fixed number of racks and based on an anticipated peak electrical power requirement. For many companies this makes the
early years of their lease very expensive for the number of servers actually deployed - because it is normal to lease the number of racks for a forecast requirement some years in the future. And very rarely is there an option to
Virtus - powering the clouds of tomorrow 34 NETCOMMS europe Volume IV Issue 1 2013
reduce the number of racks or quantity of electrical power contracted for. Consider, on the other hand, the business model of the cloud provider -
www.netcommseurope.com
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