Understanding the Role of Data Centers in Modern Business

Due |

As the cloud continues to expand and more organizations rely on data to run their businesses, it’s important that we seek to understand the role of data centers and why they’re necessary in today’s landscape (as well as in the future).

Data Centers in a World of Services

For people who like to keep similar parts and components systematically organized in neat little boxes and folders, a data center is highly attractive and beneficial. It’s like a high-tech container for all of your hardware.

But is it necessary? That’s the question many business owners, IT directors, and company stakeholders will be asking more frequently as we move through 2018 and beyond.Research from Uptime Institute suggests that 50 percent of enterprise IT data center budgets have remained stagnant or shrunk over the last five years, while 55 percent of enterprise server footprints have done the same.

Interestingly enough, the numbers also show that more than 70 percent of enterprise workloads are still running in corporate data centers, while colocation data centers only host 20 percent of systems and 9 percent of systems in the cloud.

The most interesting issue to keep an eye on will be what happens as Software as a Service (SaaS) continues its rapid ascent as the primary deployment method for enterprise solutions. While there will obviously be some movement away from traditional data centers, there are simply too many benefits of having a physical, on-site data center to believe that they’ll disappear in significant numbers.

3 Benefits of Modern Data Centers

Why data centers? Why, in a world of SaaS providers, will many businesses continue to rely on physical data centers? It depends on who you ask, but the following benefits are considered attractive and advantageous.

1. Total Control

There’s something empowering, comforting, and simple about knowing you have control over such a critically important part of your business – especially in a business world that has so many uncontrollable factors involved.



When you own your own data center, you have complete control. From the design of the data center – a detailed process in its own right – and the maintenance to being able to physically walk into a room and look at servers, there’s something reassuring about hands-on involvement.

2. Always in the Loop

Do you know what happens if you subscribe to a cloud-based SaaS solution and the vendor doesn’t own and operate its own data centers? If there’s an outage, you have no ability to fix the issue. You simply have to wait.

“In other words, you lack a direct contractual agreement with the underlying data center vendor for your cloud-based software, so you have no leverage to enforce a contract when the fault of the outage lies with the data center and not your primary vendor,” IT expert Mary Shacklett explains.

When you maintain your own on-site data center, none of this is a problem. Fixing an issue is as easy as walking down the hallway or picking up the phone, and you can get your own IT specialist on the phone to help solve the issue.

3.Greater Security

While a third-party IT provider probably isn’t going to purposefully compromise your data, you simply don’t know what’s going to happen. When you have the opportunity to keep your data private, you do so. Having your own data center provides an extra layer of security.

Give Your Business What it Needs

“It is likely that the traditional data center, as we know it today, will contract to support mainly mission critical workloads like online transaction processing systems, key financial applications and anything that is bound by regulatory compliance,” says Colm Keegan, a senior analyst at Enterprise Strategy Group. “Non-core workloads that are not directly material to business revenue like email, end-user productivity applications and CRM will increasingly be outsourced to Software as a Service (SaaS) providers.”

At the end of the day, Keegan’s projection seems most reasonable. It’ll be up to individual businesses to weigh the costs and benefits of continuing to maintain a data center. The largest organizations will still find plenty of value, while the smaller ones will outsource to SaaS providers.

The key, as a business owner, will be to understand your organization’s needs and make smart, strategic decisions that are both safe and forward-facing.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Comments

Emerging Growth

Lexaria Bioscience Corp

Lexaria Bioscience Corp is a food sciences company. It has two distinct consumer product brands: ViPova and Lexaria Energy. It uses patent pending technology to infuse hemp oil ingredients within…

Private Markets

Voleo

Voleo is a free download that allows you to form investment clubs with your friends, family, colleagues, classmates, teammates…basically anyone you know and trust. Invest and manage a stock portfolio…

iPRO Network, LLC

We provide the platform, tools, and resources to empower individuals and professionals to market desirable goods and services to the public, taking the place of traditional methods of commerce.