Gartner: Build your own datacentre rather than hosting

Despite the hype around cloud and hosting, more organisations are choosing to building their own datacentres to save costs.

Despite the hype around cloud and hosting, more organisations are building their own datacentres to save costs, according to Gartner.

In a session covering best practices in saving datacentre costs at the Gartner Data Center & IT Operations Summit 2011, Rakesh Kumar, Gartner research vice-president, said it was cheaper to build a new datacentre than use a hosted service.

“In this economic climate where people are under pressure to save costs, we are seeing a net increase in new datacentre designs. People are finding the capital to build 30,000 square foot plus datacentres.”

His revelation is astonishing, given that a European datacentre costs around £25m to construct.

Hosted services are becoming very expensive, he said. Gartner estimates the cost of renting rackspace in a hosted datacentre is doubling every two years. 

“If you pay a hosting company over four years, you will have paid for a new datacentre,” said Kumar. Given that a datacentre building will last 25 years, he recommends sweating the asset over moving to a hosted datacentre provider, managed service provider or outsourcing.

Saving datacentre costs

Data from Gartner shows that energy is the fastest growing cost in the datacentre, from 12% today to over 20% in the next five years. Given that the amount of energy coming into a datacentre is outside the control of the business, what can a business do to prolong the life of its datacentres?

According to Kumar, the energy efficiency of x86 processors is reaching a plateau. “We are probably at the maximum of reducing energy consumption on the servers.”

He recommends two approaches to ease the energy issue. If a business is constrained by the floor space in its datacentre, it can increase rack density from 25% to 90%. He estimates this will increase the life of the datacentre by three years.

The other approach is using server refreshes to prolong the life of a datacentre. “New servers are smaller and more energy efficient than prior generations. If, over time, you replace older servers with new energy-efficient servers, to achieve 90% rack usage, you can extend the life of the datacentre by 15 years.”

Kumar recommends that every new datacentre should be plumbed in for chilled water cooling and should combine multiple tiers of availability within the same building. “You can save considerable costs by switching off the air-conditioning and use free air cooling, and this will provide a significant energy saving,” he said.

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What about the cost of maintaining a staff to run this data center?
Gartner does not know what he is talking about.


It’s startling that in today’s volatile
environment Gartner is prescribing such a high risk strategy. Building your own
datacentre means (cost of datacentre aside) having the skills in-house to
ensure best of breed networking, security, database, and information
management. This is a broad set of skills to have when companies need to focus
on their core IP and R&D. Also, once these investments are committed, there
is little flexibility if clouds are on the horizon.

Should we not be considering a middle way that enables the best of both worlds,
and a less risky scenario?

The concept of a shared platform, or Hybrid
Cloud, represents the ability for enterprises that outsource to have mobility
of workload from their own datacentre to a shared Cloud-based service, to
enable them to take advantage of outsourcing, but in a controlled environment.
This is not a ‘one size fits all’ model, but a model that enables companies to
partially outsource those infrastructures and applications it makes economic
sense to put into a Cloud environment, or hosted datacentre.

Key to the Hybrid Cloud model and workload
mobility is the ability for customers to have a single management and
monitoring view of the full estate, no matter where or how it is deployed. So
not outsourcing for outsourcing’s sake but from a Capex, Opex, resource
flexibility and management point of view, this hybrid model allows for an
organisation to benefit from a pragmatic outsourcing or hosting partnership. It
provides a reassuring control and visibility of the estate and its assets for
optimum management of business operations, both in-house and via a hosting

Surely we should not be so prescriptive in our approach and look for more
pragmatic solutions.


This article is totally bogus.  Your ROI is NEVER when you build even a modest data center. If you have < 25 racks of gear you shouldn't even think about building a DC. Gartner, you get a BIG THUMBS DOWN for this article.