Assessing the Need for Colocation Data Centers

Colocation data centers have emerged as a strategic option for organizations seeking to outsource their IT infrastructure while maintaining control over their data and applications.  Assessing the need for colocation data centers and their practices is the start before evaluating potential colocation providers.  By examining key factors such as cost, scalability, security, and reliability, organizations can make informed decisions about whether colocation is the right fit for their IT infrastructure needs.

The proliferation of digital technologies and the increasing volume of data generated by organizations have led to growing demands for scalable, secure, and reliable IT infrastructure solutions.  Colocation data centers, which offer shared facility space and resources for housing servers, storage, and networking equipment, have emerged as a popular option for organizations looking to outsource their IT infrastructure while maintaining control over their data and applications. However, the decision to colocate IT infrastructure involves careful consideration of various factors, including cost, scalability, security, and reliability. A structured approach to assessing the need for colocation data centers is required, along with guidance on evaluating potential colocation providers as needed.

Complexity and advancing technology of hardware and more may mean that adding new servers might also require new types of storage, updated I/O interfaces, and more that the regular IT staff might not be able to support.  Another challenge with today’s IT infrastructure is that it’s more heterogeneous than ever, and as a result far more difficult to manage.  With reoccurring IT maintenance required for the new equipment, such as bandwidth management, security, and power monitoring, adding more to an existing data center might be a burden that the current IT teams don’t want to carry. 

Many data center customers we speak with point to management complexity as a leading pain for IT teams.  When collocating hardware, the services dedicated staff does the duty work and the teams don’t need to be concerned about how power and cooling demands are to be met. 

As demand for space that meets the myriad of criterion continues to grow, many enterprises are reaching the limits of what they can support or build in time.  Even if the facilities have the room, the enterprise may not want to invest in the capital expenditures for additional servers and their needs.  Drivers for owners now include lack of space, lack of capacity, desire to get out of the facilities business, and disaster recovery sites that need to be away from corporate locations. 

Overrated features: As colocation services have matured, so has the marketing hype around key features.  Experts are brought in to offer several examples of touted features that might not be as important as they once were.  The industry does do a lot of self-policing on regulations and meeting standards, plus tiers and other terms are abused and not have actual certification.  Measuring facilities and stating certification via TIA tier ratings is another flag, as there is no such certification based on TIA or other acronyms. 

Even if the enterprise already has a colocation provider with long-standing relationships, it should still be worthwhile to regularly check up and make sure the provider is meeting the latest developments.  Re-evaluations should be at least an annual occurrence to right-size, as some may have started big and then contracted or vice versa, and making sure that meets the current business needs without overpaying or overpromising on either side is crucial to a better result for all.  Power draw, space use, efficiency, and more should be available for review and might require deeper audits based on the size and potential discrepancies between the businesses. 

Factors to Consider When Assessing the Need for Colocation Data Centers:

1. Cost: One of the traditional arguments for moving to colocation is reduced costs.  Evaluate the total cost of ownership (TCO) of colocation versus on-premises infrastructure, considering factors such as upfront costs, ongoing maintenance expenses, and scalability.
2. Scalability: Assess the scalability of colocation data centers in terms of power, cooling, space, and network connectivity to accommodate future growth and expansion.  Most colocation providers will give additional space for expansion with a First Right of Refusal or similar, where expansion space can be allocated to customers for future use even though the space is vacant. 
3. Security: Evaluate the security measures and protocols implemented by the colocation providers to protect data and infrastructure from physical and cyber threats.  Most of the time this multiple access layers but much more may be required depending on the client or service provided, such as health care information. 
4. Reliability: Consider the reliability and uptime guarantees offered by colocation providers, including redundant power, cooling, and network infrastructure.  This should be assessed by a reputable service or engineering team to discern outages, single points of failure, and other risks associated with the facility. 
5. Environmental Sustainability: With an increasing focus on environmental sustainability, future assessments of colocation data centers are incorporating criteria related to energy efficiency, renewable energy usage, and carbon footprint reduction.  This assessment should show actual energy losses and efficiency that goes into a Power Usage Effectiveness factor.  Recycling and Scope 1 and 2 are also becoming typical for colocation companies to provide. 
6. Compliance: Ensure that colocation facilities comply with relevant regulatory and industry standards for data security and privacy, such as HIPAA, GDPR, and PCI DSS as needed.
7. Connectivity: Assess the connectivity options available at colocation facilities, including carrier-neutral network connectivity and access to multiple internet service providers (ISPs).
8. Support Services: Evaluate the availability of support services and technical expertise offered by colocation providers, including remote hands support, managed services, and disaster recovery solutions.  This may be included or as additional services. 

Additional items to consider in the evaluation:

1. Edge Computing Integration: As edge computing continues to evolve, assessments of colocation data centers may need to consider proximity to edge locations, latency requirements, and the ability to support distributed computing architectures.
2. Hybrid Cloud Adoption: With the commonality of hybrid cloud architectures, future assessments may evaluate the ability of colocation data centers to seamlessly integrate with public cloud platforms, hybrid cloud management tools, and multi-cloud strategies.
3. Data Sovereignty and Compliance: As data privacy regulations continue to evolve, future assessments may focus on the ability of colocation data centers to comply with regional data sovereignty requirements, data residency laws, and industry-specific regulations.  Mostly this is from one country to another and additional laws, regulations, and compliance measures will need to be reviewed. 
4. Emerging Technologies: As emerging technologies such as AI, IoT, and blockchain become more prevalent, future assessments may consider the ability of colocation data centers to support these workloads, provide specialized infrastructure, and enable innovative use cases.
5. Resilience and Disaster Recovery: Given the increasing frequency and severity of cyber attacks and natural disasters, future assessments may emphasize the resilience and disaster recovery capabilities of colocation data centers, including redundancy, failover mechanisms, and data replication strategies.
6. Economic and Market Trends: Future assessments may need to consider broader economic and market trends, such as shifts in demand for colocation services, pricing dynamics, and competitive landscape changes.

Best Practices for Evaluating Colocation Providers:

1. Site Visits: Conduct site visits to colocation facilities to assess physical security measures, infrastructure redundancy, and overall facility condition.  The information provided, given on a website, and shared from consultants should be checked thoroughly against the on-site conditions. 
2. References and Case Studies: Request references and case studies from existing customers to evaluate the track record and reputation of colocation providers.
3. SLA Review: Review service level agreements (SLAs) to understand the scope of services, uptime guarantees, and support commitments provided by colocation providers.
4. Scalability Planning: Discuss scalability requirements and future growth projections with colocation providers to ensure that facilities can accommodate evolving needs.
5. Security Audits: Perform security audits and assessments to validate the effectiveness of security controls and protocols implemented by colocation providers.
6. Performance Testing: Conduct performance testing and benchmarking to evaluate the performance and reliability of colocation infrastructure under real-world conditions.
7. Contract Negotiation: Negotiate contract terms, pricing, and service level commitments with colocation providers to ensure alignment with organizational requirements and objectives.  The pricing should be broken down into a detailed list of what the owner is to provide and pay and what the customer is to provide and pay.  Exceptions to this should be spelled out to be covered by the owner unless required at the direction of the customer.  This list should also be divided into one-time only costs and reoccurring costs, including the frequency of each; not everything will match a monthly cost model. 

By following a structured evaluation framework and best practices for evaluating potential colocation providers, organizations can make informed decisions about whether colocation is the right fit for their IT infrastructure needs. By partnering with reputable and reliable colocation providers, organizations can leverage the benefits of shared infrastructure while maintaining control over their data and applications.

The assessment of colocation data center is a critical process for organizations seeking to outsource their IT infrastructure while maintaining control over their data and applications.  By carefully evaluating key factors such as cost, scalability, sustainability, security, and reliability, organizations can make informed decisions about whether colocation is the right fit for their IT infrastructure needs. 

Through the structured evaluation framework and best practices organizations can effectively assess potential colocation providers and ensure alignment with their strategic objectives and operational requirements.

As organizations continue to evolve and adapt to changing technological landscapes, future research and innovation in this area will be essential to address emerging trends, challenges, and opportunities.  By staying abreast of industry developments and incorporating best practices into their assessment processes, organizations can position themselves for success in an increasingly digital and interconnected world.

References:

• Brown, C. (2019). The Ultimate Guide to Colocation. Digital Realty.
• Belady, C., & Bell, D. (2016). The Software-Defined Data Center. CRC Press.
• Al-Fares, M., & Loukissas, A. (2016). Colocation: Data Center Optimization for Cloud, IoT, and Big Data. O'Reilly Media.
• Schmidt, M. (2018). Colocation Data Center Selection Guide. Sunbird Software.
• Jones, R., & Smith, S. (2020). The Complete Guide to Colocation. Springer.