Sep 2, 2014

The Ultimate Data Center Question for Your Business: Build or Buy?

Whether you’re an internal IT department for an enterprise, or an internet-enabled business, there’s a good chance that you’ll encounter the classic “build versus buy” decision for your data center services. That is, building-out a facility of your own, or buying services from a leading technology provider instead.

stockxpertcom_id468160_jpg_smallWhen considering whether your operations may require their own data center or whether you can gain a greater value by leveraging a hosting provider, you must first begin by evaluating your needs. Are you streaming video? Running a voice over IP (VOIP) product? Managing a full catalog of products for your online store? Once you’ve established what you’ll be using your data center for, it’s time to move on to the next step: considering your budget.

Building your own data center is an enormous investment; possibly the largest investment you’d ever make in your infrastructure. To understand why, let’s start by looking at the six major costs that would make up a majority of your data center investment.


1. Buying the hardware

These are the rack mountable servers, storage, firewalls, load balancers, switches, routers, telecommunications equipment, UPS and miles of cabling which will need to be connected. The amount of gear you will need ranges from tens to hundreds of individual pieces. The price tag here will not be cheap, ranging from hundreds of thousands of dollars to many millions.


2. Building or leasing a facility

This is the building which will hold all of your gear. The facility will need to have the necessary power requirements to run your gear, cooling equipment to keep it cool, physical security, backup power and a big connection out to the Internet. Whether you lease from an existing DC provider or build your own, you are going to run into significant expenses in the process.


3. Hiring an architect

Back when Cisco first created some of the basic infrastructure guidelines for building a datacenter, the architecture used to assemble the equipment and make it all hum followed a more simple protocol. Today, connecting and optimizing these systems while keeping them highly secure, reliable and powerful is where your network architect is going to have to earn their stripes. As networking technology has evolved to meet both performance needs and threats, the number of methods and protocols involving both hardware and software that will need to be considered is almost countless.


4. Getting connected


When it comes to connecting businesses’ datacenters to the Internet or other private networks there are many different providers who can do the job. Again, it will depend entirely upon your organization’s needs, but individual contracts will have to be negotiated with each provider based upon your bandwidth and performance requirements.

5. Rack, stack and run

387676928_e23848709d_bYou’ve now done all the proverbial “heavy-lifting” and purchased a few million dollars of gear, you have your facility, a number of contracts in place and a blueprint for how to assemble it all. Now comes the literal heavy-lifting. In order to become operational, you are going to have to raise the floors, build the racks, stack your servers and make sure it stays running as designed.


6. Gaining a return on your investment

Even if you are not a CFO, the back of the napkin math for what it takes to build your data center has probably already run on to the front side of the napkin too. That is a lot of money to invest in enabling your people and your business. This is an expense that your day-to-day operations will have to pay for. Once you are operational, killing a datacenter if you decide you cannot afford to operate it will be incredibly time and cost consuming.


At the end of the day, datacenter services are a cost of doing business. How much that cost will be depends entirely upon your build or buy decision.

If you’re still on the fence about building or buying, this whitepaper from Forrester on the Economics Of Data Center Facilities may help you out. Otherwise, you can learn more about Codero’s data centers, or contact one of our hosting experts to get answers to any of your data center questions.


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