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Buy? Build? Rent? Which DataCenter Option Is Best For You?

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Your information technology (IT) infrastructure is, undoubtedly, a critical part of your business. In order to store that infrastructure, you’re likely going to end up using a datacenter. Selecting the right datacenter option is essential - considering it will house most or all of your most important data and applications.


Now, when looking at your business needs, you should also consider whether to buy an existing facility, build your own, or rent usage from a datacenter provider. In other words, what makes the most sense - invest in building a dedicated center, purchase a center or lease space from a data center provider? Here are some of the major factors to consider when making this decision.

  • What is your evaluation criteria and does it match the key business stakeholder criteria? Being strategically and culturally aligned is the first and most important step.
  • How much uptime do you need?
  • How much downtime can you afford? Building a datacenter or making any changes can expose your organization to downtime. Datacenters are skilled at helping to prevent, minimize, and manage downtime. Major data outages can be devastating for a business so there must be a plan to effectively manage that should you build a datacenter.
  • Have staffing costs been factored in? Staffing a data center can be a significant investment. It should be considered within the overall cost, as well as ensure the talent has the level of expertise needed to operate the data center at top tier capacity. You’ll also want to consider training and turnover – and whether you’ll insource or outsource the labor as well as the overhead to manage the labor.
  • What is the cost to comply with regulations in your industry and the cost of maintaining audit compliance? In some cases, the audit itself may cost as much as $100,000 annually – and your clients will demand to see the results. The fees to improve your processes and procedures after an audit can be costly as well and often lead to unbudgeted ongoing expenses.
  • What is this the best use of capital and operating dollars in your business? Most businesses are not operating from an infinite well of cash. Is the expense of building and operating a data center within the budget of the business?
  • How much capacity for space, power, cooling and network do you need? Building your own may seem doable now, but you’ll be building something with fixed capacity.
  • How will you fund flexibility and expansion as your needs grow and decline?
  • How quickly do you need it, and how much lead-time will you be able to give the business stakeholders when the business changes? If you are an evaluator of datacenter services, you need to be aligned with the business stakeholders – and their decisions may weigh more heavily toward speed to market.
  • Will this consideration delay your speed to market either now or in the foreseeable future? Building a data center takes time, and as mentioned, capital. This will likely delay speed to market. If that is a serious consideration for your business, it needs to be factored.

Redundancies for power, cooling, compliance requirements and networks

When considering the cost and complexity of building or renting, make sure you are comparing apples to apples. Most companies that aren’t in the datacenter business will budget for a single source of power and few, if any, redundancies within these critical elements. Most commercial datacenters that offer “co-location” have built all their infrastructure for primary and secondary power – and the facilities to make these redundancies work properly, including testing everything on a regular basis.

When these commercial datacenters plan and build something, the cost is typically 2.5 times the cost that you might be thinking. That’s 1 for primary, 1 for secondary and .5 to install and make sure everything is running efficiently. Remember, it can be costly to plan for how long generators will perform.

A large reason that not all datacenters and co-location facilities function the same is simple – not all datacenters have access to the same networks. A datacenter is of little use if it sits in the middle of a corn field without access to fiber optics. The score you give on the scorecard changes significantly when you factor in access to local and global fiber. Flexibility and choice is key because what you need today may not be what you need tomorrow – these are long-term decisions with implications for years to come.

The cooling needs of the computing equipment are of paramount importance in the data center business. Every year, the efficiency of the equipment gets better, yes, but we are all trying to cool equipment that is denser and hotter within a smaller footprint…and the equation you are trying to solve for is constantly evolving. So how do you budget and plan for something when you never know where the end zone is?

Selecting the right datacenter option can be very complex and is unique to the needs of our company. The good news is that we’re here to help! If you have questions or need some guidance through the process, contact us here.


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You can learn more about our Core DataCenter options here.  Download our free e-book for more aspects to consider in the data center selection process. Follow us on LinkedIn and Twitter for the latest news from LightBound!