How adopting co-location is a key part of an effective digital strategy

Digital transformation, the process of using digital technologies to create new or modify existing business processes, products and customer experiences, is about more than deploying technology. It is also about developing a strategy that delivers improved efficiency, innovation, customer satisfaction and competitiveness.

How can businesses get to these sunlit uplands from where they are now, though, which is often a place defined by dependency on legacy infrastructure?

Certainly, will is required – and it is there, according to Dermot Lahey, head of client services for Ireland at Digital Realty, the global data centre services and co-location provider that has a major footprint in the country.

Indeed, co-location is a central tenet of many digital transformations, as the goal is to deploy IT infrastructure that can meet constantly growing and shifting customer demands.

“We’re seeing significant acceleration in people having conversations about the digital transformation journey. In part, that involves their move to co-location, which, briefly, is where we can provide a highly connected, secure and reliable environment to process and store their data,” he said.

This represents something of a shift: Irish businesses have been slow to move away from running IT operations from server cabinets, with the exception perhaps of the adoption of light-touch cloud, largely in the form of software-as-a-service.

Today, however, Lahey said, running everything from headquarters makes it extremely difficult to meet customer demands.

“The driver they are finding is that their on-premise IT is no longer fit for purpose,” he said.

“In the past companies have been slow to move, but it’s speeding up for a number of reasons. Firstly, they’re looking at their data strategy, seeking best possible access to the data they want, and they need to be synchronised across locations and have strict SLAs [service level agreements].”

What businesses want is, firstly, a high standard of security, reliability and connectivity. Next, they want to replace wide area networks (WANs) that no longer deliver in the mobile-and-online-everywhere age.

“They’re looking to drive interconnection because, traditionally, in the past, WAN architectures were designed to connect regional offices, and that type of network topology was designed for on-premise infrastructure,” Lahey said.

“With the proliferation of cloud services as alternatives to traditional IT service, and customers accessing through mobile applications, that is becoming obsolete. What they’re looking at now is pointing their network infrastructure toward interconnection hubs.”

Digital Realty has been in conversation with businesses in sensitive areas with a significant need for compliance and security, such as financial providers and law firms, and found that their needs are evolving as they have a growing geographical spread of people.

“With us, they securely move data from those remote locations to the central location, rather than to a data centre in the basement. By housing the data, it gives them plenty of flexibility that they would not have if it was located in a single building,” Lahey said.

Interestingly, even with pure cloud, interconnectivity is crucial, but modern co-location providers like Digital Realty can provide private connections to the cloud, as well as to other businesses in co-location, or out on to the public telecommunications network.

This increases security – and reduces latency to effectively nil.

“Businesses can decide how they want to share their data, privately with other customers, with cloud providers they may have, or just use it internally,” Lahey said.

“You can connect to cloud providers, literally physically, within the [co-location] building, or you can have two customers using a fibre cross connect within the building, avoiding the need to go out on to the public internet. The latency is the speed of light at that point, and security is being done within the building and facility.”

The third driver of the move to co-location is workload placement. In other words: where do you put your processing power? Traditional on-premise infrastructure not only suffers from performance issues, but it is expensive.

“It’s unlikely you’d be able to operate at the same level of performance from an owner-occupied data centre, whereas with co-location businesses can take advantage of significant savings, in terms of power and cooling for a start. What we’re seeing here is up to 25 per cent of savings in the cost of keeping that equipment cool,” he said.

Digital Realty’s Dublin co-location facility offers direct connections to 50 connectivity providers, giving not only extreme redundancy but also a huge array of different options for its tenants.

“Compare that to the cost of having even just two, three, or four [providers] connecting to your own server closet and the difference is incredible,” said Lahey.

The upshot is that co-location users are in a position to future proof and take advantage of changes in technology. Not only because, in an on-premise situation, the speed at which an organisation can adapt, secure its data and cool its environment is significantly slower, but also because of the broader flexibility afforded by the level of interconnectivity in co-location.

“In a co-location situation, when it comes to playing your workload close to the providers, you can spool that up or down according to your business need,” Lahey said.

This, he said, ties into the central premise of co-location: your infrastructure and your data is made as available as you need it, but it always remains yours.

“You as a company retain control,” he said.