The Cloud vs. Colocation for Connecting Digital Infrastructure

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DC BLOX Connectivity Article 2 of a 3 Part Series

As IT executives develop the blueprints and architecture needed to deliver on their digital transformation initiatives, the growing challenge of connecting to a myriad of partners, providers and platforms looms. Digital infrastructure is becoming increasingly distributed and local communications providers from a company-owned data center may not be able to meet the bandwidth, latency, location and cost requirements necessary to realize their digital goals.

Many IT organizations have leveraged the cloud to deploy scalable infrastructure and are now looking to the cloud to address their growing connectivity needs. Let’s explore some of the challenges of leveraging the cloud for connectivity across an increasingly distributed IT environment, and how a colocation data center can play a key role in meeting the need to connect all the infrastructure and partners required of today’s digital business.

Why Businesses Are Moving to the Cloud

According to Gartner, the Worldwide Public Cloud Service Revenue Forecast for IaaS is expected to reach $39.5B in 2019, and to jump another $10.4B reaching $49.9B by the end of 2020. In the IDG 2018 Cloud Computing Survey of computing trends among technology decision-makers, “73% of organizations already have one application in the cloud or at least a portion of their infrastructure,” and another 17% planned to take their first step in the subsequent 12 months. Managing Cloud, at first glance, seems easier. The lure of scalable infrastructure on demand, capital avoidance, and outsourced management is driving applications out of the company’s data center and is enabling new services to be developed specifically on cloud platforms.

In their survey entitled Cloud Insights 2018, IDG asked 550 technology decision makers to rank their top business goals or objectives for investing in cloud computing initiatives at their organizations.

Improve Speed of IT Delivery 71%
Greater flexibility to react to changing market conditions 63%
Enabling business continuity 58%
Improving customer support or services 57%
Total cost of ownership (TCO) 51%
Replacing proprietary technology 39%

Cloud solves a myriad of problems, but with the potential benefits come new challenges.

Challenges in Moving to the Cloud

Determining which workloads are appropriate for the cloud and how to address the connectivity requirements of the business’s current and future plans is an important issue in planning IT’s evolving architecture. There are many factors to consider as not all applications will be suitable.

Downtime
All services fail and cloud is no exception. One notorious outage occurred February 28, 2017, when an engineer at Amazon Web Services, while moving a small number of servers, mistyped a command. The four-hour failure resulted in web services blackouts and degraded performance. The financial fallout included $150 million in projected losses from the S&P 500 companies and another $160 million lost by U.S. financial services companies. Many customers have assumed too much about the reliability of cloud providers’ platforms and, having avoided taking responsibility for redundancy of their cloud deployments, paid the price.

Application Conversion Time and Cost
Application conversion is a significant issue preventing the movement of workloads to the cloud. Many legacy applications need significant modifications to run in cloud environments. The cost of development and testing may be prohibitive, while the hardware these apps are running on is often fully depreciated. Thus, in many cases, it’s more economical just to let these systems run on traditional servers.

Security and Privacy
Moving intellectual property and sensitive data from the confines of company-controlled servers to a cloud-based solution outside of company firewalls may introduce risk. There are enough security threats to applications running in the cloud to warrant a justified concern over company data protection. At least part of the problem lies with users’ improper configuration of apps in a cloud environment. Another problem with risk and vulnerabilities is that they keep changing with every new advance we make in technology. In the article “Why hybrid cloud architecture means totally rethinking security,” VentureBeat staff make the point that the vulnerabilities exploited change from year to year.

Cost Management and Containment
The ability to predict usage budgets has proved difficult with cloud. Due to the ease of and lack of control around spinning up new virtual machines, higher than expected usage, and a myriad of add-on charges, customers are often shocked at their monthly invoice. Though the attractiveness of capital avoidance and scalability are strong drivers to deploying cloud, some businesses find they may have been better off in the long-run had they avoided the cloud.

New tools are being deployed to help manage costs, and better discipline will be needed to ensure the economics of cloud deployment make sense.

Application Performance
Cloud environments are necessarily standardized to handle the most prominent configurations and needs. It therefore may not be possible to tune complex applications in a cloud environment resulting in poor performance. In some cases, specialized hardware, also not available in cloud environments, may be necessary to run an application optimally.

Compliance
Many industries are subject to compliance regulations that limit the ways sensitive data can be stored and distributed. The vagueness of these requirements combined with the uncertainty of how the cloud providers can ensure compliance may result in companies maintaining strict data control to protect against fines.

Gartner surveyed 110 senior executives who identified cloud computing as the 2019 top concern in risk, audit, finance and compliance. These days, companies may face heavy fines for non-compliance with regulations and requirements including GDPR (General Data Privacy Regulation), HIPAA (Health Insurance Portability and Accountability Act of 1996) and PCI DSS (Payment Card Industry Data Security Standard).

Connectivity Challenges
While it’s true that the cloud may enhance connectivity when compared to the options available from a business’s own data center, there are still challenges inherent in cloud implementations.

Complexity
Configuring and managing network services to connect to the myriad of partners, business locations, applications and devices in today’s digital environment can be daunting. Amazon Web Services, Microsoft Azure, Google Cloud and others have sophisticated sets of networking services to accommodate a variety of use cases, including private connections from business locations, content delivery networks, load balancers, firewalls, VPNs and more.

The responsibility to set up, test and manage these services rests with the customer and can be challenging without deep cloud networking expertise. The more endpoints involved the more complex the process. That is especially true if a business needs to connect to services hosted by multiple cloud providers. Support is available but can end up being an expensive add-on for business-class service.

Cost
Cost is another issue with public cloud network services. Network costs are unpredictable. For example, AWS may charge for port hours, numbers of connected endpoints, data processing, data transfer and distance depending upon the type of service. Moreover, multiple services or networks may be involved.

Predicting and limiting these costs can be difficult even with the help of provider calculators. In addition, the usage-based pricing inherent to most cloud providers’ network services tends to favor more intermittent traffic rather than continuous loads. In the latter case, a fixed committed data rate model would be far less expensive and is not available for all services.

Performance
Performance challenges are another public cloud provider network consideration. With geographical availability limits on cloud infrastructure, data from end users, devices or applications may need to travel over multiple networks, including the public Internet, and over distances that result in poor application performance due to latency.

Content delivery networks may help but may again increase the cost and complexity beyond the benefit. For these reasons, there are limits to the applications that can be feasibly moved to the cloud.

Businesses with a vision of a cloud-only or cloud-primary future would be wise to consider the networking complexity, costs and performance as infrastructure increasingly disperses.

The Colocation Data Center’s Role in Digital Infrastructure

So far, we’ve considered the connectivity challenges of a business-owned data center, and established that, though the cloud offers great benefits to IT, it does not solve all of the connectivity challenges to IT’s distributed assets. Let’s now look how a carrier-neutral, tier 3-rated multi-tenant data center with rich connectivity can become an integral part of IT’s digital infrastructure.

A multi-tenant data center offers the opportunity to move compute and storage infrastructure into a colocation facility that is highly connected to the networks you need to support today’s distributed IT, while also leveraging the cloud for suitable applications.

Infrastructure within the data center can then connect with cloud apps in a hybrid cloud or multi-cloud model, while also connecting to all the other partners, providers and platforms needed to support other elements of your business’s services.

A strong data center partner can enable the agility needed in today’s fast-moving IT environment and should serve an important role in IT’s future digital architecture.

Reliability
Maintaining 100 percent uptime is the goal for all organizations. Check for a multi-tenant data center provider with at least a Tier 3 rating (per Uptime Institute’s standards), redundant power distribution and resilient networks with physically diverse routes and latency guarantees. A good data center provider is happy to inform potential clients of their SLAs and reliability record. Often, the reliability of a modern Tier 3 data center will far exceed an older company-owned facility. When attempting to gain information from a cloud provider, it may be difficult to get the topology or architecture of their network. SLAs are available for some services, but businesses won’t likely see much of a service credit if those SLAs are not met.

Security & Privacy
Placing company infrastructure in a secure data center, rather than a cloud environment, enables more control, visibility, and accountability. The customer manages the digital security infrastructure as well as the appropriate policies and procedures. The data center provider should be able to describe the multiple layers of physical security in place to protect your company’s equipment. A data center provider like DC BLOX that offers Cloud Storage enables businesses to back up data from their primary storage systems and also enables the copying of stored data to a secondary site for geographic diversity and additional data protection.

Application Performance
Multi-tenant data centers can improve application performance in several ways. Performance may be improved through the customer’s deployment of specialized hardware. Cloud providers offer standard platforms that may not meet application performance requirements. In addition, tuning certain platform parameters may help application performance when you are in control of the hardware, versus the more limited options available on a cloud provider’s platform. Finally, application performance can be enhanced by deploying compute resources in data center locations physically close to end customers where no cloud provider data centers are available. Cloud data centers and even their content delivery locations tend to be located only in major metropolitan areas.

Compliance
A secure multi-tenant data center with appropriate certifications housing company-owned infrastructure can often enable businesses to more readily meet their compliance requirements than business owned data centers or cloud alternatives. With the added control of data on company-owned servers and business processes fully managed by the company, passing compliance audits are much more straightforward.

Connectivity
Connectivity is where a modern, richly connected, multi-tenant data center shines. With proximity to high-speed optical fiber paths, you can get anywhere from there. And you can get there fast. Yet, at the same time, you can protect your sensitive data by keeping it on your own equipment in a secure facility and know exactly where it is. You can deploy workloads where they make the most economical sense, and still privately connect to applications running in the cloud.

A local multi-tenant data center partner that focuses on robust connectivity also has the expert staff to design and implement the network to meet your requirements. Find a partner with proven expertise and look for following attributes:

Carrier Neutral
To meet clients’ varied connectivity needs, the data center provider should build in a variety of carriers. A network fabric connecting each data center location offers clients their choice of carriers across the entire provider’s footprint.

High Bandwidth Connectivity
Data centers should have high-capacity bandwidth of at least 100Gbps. Businesses often cannot get this capacity from their business location.

Private Network Fabric
Data centers should supply private, low latency connectivity from every data center to multiple Internet Exchanges to enable access to hundreds of providers for a truly global reach.

Software-Defined Network
Data centers should enable rapid provisioning of services to match the speed of today’s digital business. This is essential.

Cloud Provider Connectivity
A multi-tenant data center should provide direct private connections to all major cloud providers and support hybrid and multi-cloud configurations.

Local Support
Data centers should have proven expertise in networking and connectivity. A client must have access to knowledgeable staff to help design, configure and manage network connections. This reduces the burden on your existing staff and eliminates the need to hire hard-to-find qualified staff.

Cloud vs. Colocation: Final Thoughts

The digital revolution continues to accelerate and nobody without a crystal ball can tell where it’s going. A few things are certain though and one is that the days of managing everything from a company’s local data center are rapidly coming to an end. The need to engage and connect to an increasing number of entities is a principle you can count on. Mobile apps, location-based services, eRetail, AI, virtual reality, and personal assistants are fundamentally changing the end user landscape. SaaS/IaaS/PaaS, 5G, automation and IoT are altering the underlying economics of industries and generating new ones. The collection, distribution and analysis of data are providing market insights which are driving toward a hyper-competitive future.

Digital infrastructure is scattering everywhere, and you need to connect to it. Businesses need partners that provide them the agility and expertise to navigate, attack and respond. So, consider how a local colocation data center partner can sit at the core of your business’s digital infrastructure to ensure you’re ready for the challenge. And buckle your seat belt!

Learn more about DC BLOX and how our staff can assist your organization with your unique digital transformation needs.

If you missed the first article in this connectivity series, check out Digital Transformation and the Challenge of Data Center Connectivity. Stay tuned for the final article in this three-part connectivity series, Data Center Requirements for Digital Transformation, which explores how DC BLOX meets the connectivity needs of today’s digital business.

About DC BLOX
DC BLOX is a multi-tenant data center partner offering the infrastructure and connectivity essential to power today’s digital business. DC BLOX’s, software defined network services enable access to a wealth of providers, partners and platforms to businesses across the Southeast. DC BLOX data center locations are in Atlanta, GA, Chattanooga, TN, and Huntsville, AL. Its newest location is under construction in Birmingham, AL.
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