The Hidden Costs of Hosting Your Infrastructure On-Premise

The Hidden Costs of Hosting Your Infrastructure On-Premise

There are many myths around it and the choice between hosting your mission-critical infrastructure in-house or accommodating your IT infrastructure in a professional data center. Managing and implementing your business-critical infrastructure in-house is a huge responsibility on top of your daily work. The specialist requirements with regard to the management of electricity, cooling and security are hard at the helm. In addition, the excessive overhead on company resources to optimally manage the infrastructure and its environment creates its own set of challenges. The choice should not only be made on the basis of costs. It depends on your business requirements and specific usage options, as well as the costs of the service.

Outsourcing, cloud readiness and financial pressure are a recurring topic

The role of IT has come a long way, with the success of companies now heavily dependent on the ability of the organization to digitally transform. IT and the infrastructure they build are under extreme pressure to perform, with most IT departments facing a tough battle to meet the demand from the operation (business). Digital technologies are drastically changing the way we do business, with business rules changing every day. With companies that continue to reinvent themselves, IT requirements are becoming increasingly difficult to predict now and in the future.

Research shows that nearly 70% of digital transformation projects are not finished within the set deadlines, with only one fifth of customers claiming that their transformation projects are successful in the long term. That said, taking the extra financial and resource costs needed to build and maintain your mission-critical infrastructure makes little sense if your digital journey and your business continue to mature. As such, moving your business-critical on-premise infrastructure to a specialized colocation data center has quickly become the preferred choice that many organizations consider as part of their search to successfully digitize their business activities.

The costs for housing your IT infrastructure are increasing

Moving your mission-critical IT infrastructure is not a decision that can be taken just like that. There is a lot of effort, time and costs involved, so it is essential to keep an eye on the real costs or to keep your data center internal so that you can make an informed choice as to whether it is worth switching to colocation.

There are so many variables that need to be taken into account when calculating the total costs to keep your critical IT infrastructure on-premise, under management or your internal IT function. In addition to purchasing space, cabinets, cables, switches and other equipment, there are countless other costs involved in design, engineering, power, cooling, security and connectivity to take into account. There is no doubt that all of these functions can be internal internally, but the question is whether they will be managed efficiently and cost-effectively? And since it is not your core business, what is the most realistic quality level that you can expect to deliver to your company and your customers?

Is your office designed for accommodating people or business-critical IT infrastructure?

Let’s face it, almost all office environments are not designed and built for a large, hot, energy-wasting IT hardware for businesses. Like many other companies, your business cannot run without your critical infrastructure, so with companies now running 24×7, it means that a lot of heat and noise is generated in a confined space that is not specifically built to support that kind of environment. Does this sound effective?

Traditional office air conditioning is built to keep people comfortable, as opposed to the specialized cooling that is needed to make machines work optimally. With office air conditioning running when people are nearby, it is running 24 hours a day to keep your infrastructure cool, meaning your energy bills are likely to go through the roof. Similarly, air conditioning units can control the temperature (to a point) but cannot control the humidity. This is less of a problem for people, but it is life threatening for critical IT infrastructure. Excess moisture can be a contributing factor in the early failure of devices, continuously reducing their service life and increasing the frequency of maintenance and replacement of equipment.

This is a major risk to business continuity, we all know that downtime or our business-critical infrastructure has a huge impact on the productivity and brand, reputation and ultimately the business results of an organization.

Purpose built data center facility

It’s all about the security of your critical IT infrastructure

Security and compliance has become a major concern and cost center for many organizations. Data is now the most valuable enterprise resource and when it comes to security, no local environment can be compared to the 24 x 7 x 365 security protocols deployed by a large-range co-location center operator.

Research from IBM Security shows that the global average cost of a data breach is $ 3.86 million, an increase of 6.4% over the previous year. The average cost, globally, for every lost or stolen record of sensitive and confidential information has also risen and now stands at $ 148 per record. These are immense costs.

Most colocation facilities across multiple security zones, including double-factor authentication. In our data center in Amsterdam, for example, both an access card and a biometric fingerprint scan are required to gain access. In addition to this multi-layer authentication model, data center facilities will generally also include fencing on the edge, extensive alarming, monitored camera systems and on-site security personnel. This means that the security attitude that your organization maintains around its data is significantly improved in specialized data center facilities at considerably lower costs than can be achieved on site.

High Secured data hall with Mantrap Security


Unlock your business: connectivity is important

Ultimately, all of the aforementioned is irrelevant if you are unable to connect seamlessly with your IT partners, neutral carrier networks, and cloud service providers that are now probably the platform on which many of your core business processes are managed. In addition to the costs of managing on-site infrastructure, additional costs for WAN infrastructure and fiber connectivity services are required to keep you connected to the multi-cloud hybrid world where organizations are now active.

Without the flexibility to access an extensive connectivity ecosystem, your organization cannot grow or achieve its objectives, and this is an area where the benefits of collecting your critical infrastructure in a data center will truly generate value for your company. You not only get access to a considerably larger number of telecommunication carriers, but you can also connect directly to all major public cloud providers and to many or local private cloud providers.

Can you afford to stay on-premise with your mission-critical IT infrastructure?

Your customers, partners and employees who nowadays expect an ‘always-on’ service level, as well as a seamless and frictionless experience, can you afford to continue with the costs and complexity of maintaining a local data center?

Failure of any kind is no longer an option. It costs organizations enormous in terms of both financial and reputation damage. Perhaps the best example of this is a failure of Amazon’s infrastructure in 2018 for the one-hour period, causing Amazon to miss out on a $ 100 million turnover. These are extreme examples, but what is the impact if your organization is not “online” for a short or longer period?

As a data center provider we have gained a lot of experience in helping our customers realize the true value of colocation. Our goal is to help customers optimize the returns they get from their business-critical infrastructure, and we would like to take the opportunity to work with you and achieve the same result. Contact us today to explore the possibilities.

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