Windstream Webinar: “Data Centers: Outsource or Own?” with Forrester Research
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The document discusses the critical factors in deciding whether to outsource or own data center facilities, highlighting trends such as increasing outsourcing interest due to lower costs and business continuity demands. Key considerations include power accessibility, cost models, flexibility, and site selection, with recommendations for capacity planning and future flexibility. It emphasizes the importance of aligning data center strategy with business requirements to achieve effective operations and rapid scalability.
Windstream Webinar: “Data Centers: Outsource or Own?” with Forrester Research
- 1. Data Centers: Outsource or Own? Presented by: Rachel Dines, Forrester Research, Inc. Christopher Nicolini, Windstream Hosted Solutions Nov. 17, 2011
- 2. Introduction Today’s Presenters: Rachel Dines, Research Analyst Forrester Research, Inc. Chris Nicolini, Data Center Operations Director Windstream Hosted Solutions 2
- 3. Data center facilities are the most expensive investment in infrastructure — before making this big decision, make sure you have explored all the options! 3 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 4. Agenda Current trends in data center facilities Key factors to consider when sourcing your facility Best practices for data center site selection Recommendations 4 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 5. More than a quarter expect to increase spend on data center and IT facilities “How do you expect your firm’s spending on data center and IT facilities to change over the next 12 months?” 49% On average, companies devote 19.3% of their hardware/infrastructure IT budget to data center and IT facilities 26% 9% 8% 5% 3% Decrease Decrease Stay about Increase Increase Don’t know more than 5%-10% the same 5%-10% more than 10% 10% Base: 2100 IT decision-makers at enterprises and SMBs worldwide 5 © 2011 Forrester Research, Inc. Reproduction Prohibited Source: Forrsights Hardware Survey, Q3 2011
- 6. Overall trends ! Interest in data center outsourcing is increasing due to: – Lower initial cost. – Improved speed to market. – Consolidation of smaller computer rooms and facilities. – Expansion as older data centers run out of capacity. – Business continuity requirements. ! Still, there are valid reasons to build your own data center 6 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 7. The use of colocation and managed services for provisioning recovery sites is on the rise “How do you provision your recovery site?” We own the site 46% Shared fixed-site IT infrastructure at a 31% service provider Colocation site 17% Multi-tenancy managed hosting 13% Dedicated fixed-site IT infrastructure 9% at a service provider Dedicated managed hosting 7% Cloud-based 4% Other 4% Base: 180 disaster recovery decision-makers and influencers at business globally with a recovery site (multiple responses accepted) 7 © 2011 Forrester Research, Inc. Reproduction Prohibited Source: Forrester/Disaster Recovery Journal November 2010 Global Disaster Recovery Preparedness Online Surveys
- 8. Agenda Current trends in data center facilities Key factors to consider when sourcing your facility Best practices for data center site selection Recommendations 8 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 9. The spectrum of data center sourcing options In-house Outsourced Infrastructure outsourcing/ Own and operate managed data center services/ hosting Colocate data IaaS/Cloud or center strategic right- sourcing Less managed More managed 9 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 10. Key considerations: power Build Outsource ! Power is limited by what the utility company can ! Better access to power deliver to your location. ! More competitive rates on ! Power costs will be at the power local commercial rate. ! Wholesalers: actual power costs at industrial or lower negotiated rate ! Retailers: flat rate for a fixed capacity circuit, which includes markup 10 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 11. Key considerations: cost model Outsource ! Costs are low or nonexistent upfront (usually equivalent to Build first month’s rent). ! Costs are high upfront, then ! Ongoing costs are for rent and continued maintenance, power, power and are much more and security costs are ongoing. predictable. ! Costs can be unpredictable ! Costs are predominantly due to break/fix and operational expenditure. maintenance. ! Infrastructure and power costs will be higher due to less purchasing power. ! Costs are predominantly capital expenditure. 11 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 12. Key considerations: flexibility and control Outsource Build ! Changes in requirements can ! Slower to accommodate be accommodated very quickly changes in IT/business as colocation providers are requirements (power, space, constantly building out etc.) additional space. ! Time-to-market for initial build ! Construction is often modular, can take years for a traditional easy, and quick to expand. facility. ! Time-to-market is measured in ! More control over operating weeks. environment (maintenance windows, temperature, access ! Less control over the facility control, cooling systems, infrastructure, etc.) 12 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 13. Other key points to consider Build ! It’s hard to plan for a life span of Outsource 20-plus years. ! Outsourced data centers are run ! Building out too much space can by professionals with extensive be costly, as it is inefficient to run experience running mission- an empty site. critical facilities. ! Most companies don’t have the ! Outsourced facilities house an expertise on staff to design and ecosystem of potential partners build a facility. (network providers, trading ! Bringing multiple network platforms, hosting providers, providers to your facility will be cloud providers, etc.). costly. ! Outsourcing commodity services can allow you to concentrate on more strategic ones 13 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 14. Agenda Current trends in data center facilities Key factors to consider when sourcing your facility Best practices for data center site selection Recommendations 14 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 15. Where in the world should you put your data center? ! Most companies prefer to keep their data centers close to their corporate headquarters, however consider the following… – Companies with headquarters in expensive (real estate and power costs) or risky regions should consider locating their data centers elsewhere – The majority of IT systems today can be managed remotely – For tasks that require a physical presence (i.e., racking and stacking, swapping tapes, etc) consider using a data center provider’s “remote hands” 15 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 16. Checklist data center site selection " Cost of labor, real estate, utilities, and taxes " Natural and manmade threats " Economic and political risk " Availability, stability, and reliability of power and space " Telecommunications availability " Accessibility of the location " Ability to utilize green technologies " Availability of local talent 16 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 17. Fewer companies locate the recovery site beyond 1000 miles What is the distance between your primary data center and your furthest backup data center, in miles? Greater than 1000 20% miles 13% 500 to less than 1000 13% miles 17% 250 miles to less than 13% 500 miles 14% 100 to less than 250 2007 (n=238) 6% miles 11% 2010 (n=180) 50 miles to less than 10% 100 miles 11% 25 miles to less than 15% 50 miles 15% Less than 25 miles 22% 21% Base: Disaster recovery decision makers and influencers at businesses globally with a recovery site (percentages may not total 100 due to rounding) 17 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 18. Agenda Current trends in data center facilities Key factors to consider when sourcing your facility Best practices for data center site selection Recommendations 18 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 19. Recommendations for getting started Define business requirements • Before you begin, make sure you know the business requirements for your facility: • Availability and resiliency (Tier III or Tier IV?) • Future growth (ability to accommodate acquisitions or new products, etc.). • Speed to market (how quickly do you need to be able to provision new capacity?) Start capacity planning • However you provision your data center, knowing your current and future capacity is key to achieving ROI. Plan for future flexibility • Even if you plan today for future IT growth, business requirements are constantly changing. • Plan with your data center provider or architect your facility for flexibility. 19 © 2011 Forrester Research, Inc. Reproduction Prohibited
- 20. Operational Insights Chris Nicolini, Director of Data Center Operations for Windstream Hosted Solutions 20
- 21. Windstream Corp. Snapshot" S&P 500 company with full suite of IP-based voice and data services, MPLS networking, data center and managed hosting services and communication systems to businesses and government agencies • $4 billion in annual revenues • 10,000 employees • 29 states and District of Columbia • Data centers: 13 • 60,000 route miles of local and long-haul fiber network 21"
- 22. Presence 22
- 23. Trusted by Top Brands Biotech/Healthcare Technology Retail/Consumer Banking/Finance Digital Media 23
- 24. Data Center Overview ! Tier II and III, SAS 70 Type II compliant data centers ! System + System uninterruptible power supply (“UPS”) systems, and carrier neutral network connections ! Heating, ventilation and air conditioning (“HVAC”) systems to maintain temperature and humidity within strict tolerances ! Hardened facilities with automated facility management tools ! Fire control with early warning smoke detection, clean agent suppression and/ or dry-pipe sprinkler system ! 24 x 365 NOC & facilities staff provide for high security externally and internally ! Service Level Agreement (“SLA”) backed guarantee of 100% power availability ! Modular builds - most expansions are less than four years old (10k sf or larger) ! 24-36 in raised floor no open systems or racks 24
- 25. Build vs. Buy Costs of building Data Center Space $1250 - $2000 / sqft – Initial Cost Redundant Internet 1000 sqft data center = $1.25 -$2.0 Million in CAPEX *Maintenance & Repair = $150K - $250K / year Human Capital = $150K - $400K / year Utility Power Cost = $300K-600K / year * Does not include maintenance on IT / Network Equipment - All costs except utility power are fixed in the short term 25
- 26. Distractions from your core competency ! Facility Infrastructure Maintenance ! Capacity Management ! Physical Security 26
- 27. Infrastructure Maintenance ! Facility Maintenance is a full time function ! Generator (M, Q, A) ! ATS (A & 5yr) ! Switchgear (A & 5 yr) ! UPS (Q and A) ! Batteries (Q, A, and 5 yr) ! PDU (Annual) ! HVAC (Q) ! Fire (S & A) M = Monthly, Q = Quarterly, S = Semi-Annual, A = Annual, and 5 yr = 5 year 27
- 28. Capacity Management Areas often overlooked: Power ! Redundancy at the Panel, PDU, UPS, Gen, and Utility ! Seasonality - 35% swing causes overages Internet Capacity ! Circuits sized for average speeds are overwhelmed by seasonal traffic or single upstream provider outage HVAC ! Power Density growth 28
- 29. Physical Security ! 24/7 staffing for security takes a lot of effort Redundant Internet Redundant Internet ! Complete Physical Security is hard to achieve ! Camera system storage is time consuming and expensive ! Card and Biometric systems require constant monitoring / maintenance ! Documentation for Receiving / Shipping of packages and critical media is difficult ! Compliance Concerns ! SSAE 16 Standards are very high ! Compliance standards are “Order Qualifiers” for hosting providers 29
- 30. Summary Q&A 30
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