Enterprise data centers won’t really go away

The network specialist Aryaka recently sponsored a survey of 1,600 IT professionals. More than half (51%) said they planned to close all their traditional data centers in the next 24 months. Furthermore, 27% said they would eliminate at least some of their facilities, citing cloud computing migration as the primary driver.

If you drove around the hamlet of Ashburn, Virginia, you would never guess those percentages were correct. I live and work nearby, and data center construction rages on in Ashburn. Four- and five-story windowless monsters flank many streets, making them look more like corridors than roads.

A typical data center can suck up more power than a small town. When you look at the systems they house, many run at low utilization levels. The typical enterprise that owns data center–housed systems purchases more hardware and software than they need in order to allow for fluctuations in market demand, environmental factors, time of year, and so forth. These are not practices that promote sustainability or drive down costs over time.

Can you sense a bit of my hostility toward the drive to build more data centers? It’s more a feeling of frustration. We need to use our resources more efficiently.

Many view the pandemic as the final nail in the coffin for traditional data centers. The new normal of remote and hybrid work is forcing most enterprises to reevaluate their office needs. Many also found that the centralization of systems in a physical data center became a point of failure during the early days of the pandemic when quarantines and lockdowns denied physical access to the data center to replace or restore downed servers or to make other physical repairs. However, the journey to fewer enterprise-owned data centers is nothing new. The pandemic simply increased the speed of that journey.

Although cloud computing drives much of the demand to shut down traditional enterprise data centers, alternatives such as colocation providers and managed services providers (MSPs) will also lead to reduced use of traditional data centers. Indeed, these are often more viable options for enterprises that want a fast move out of data centers. Colocation providers and MSPs can usually host what existing data centers now host, including older systems such as mainframes and minicomputers that don’t yet have analogs in public clouds. They can also host traditional systems with migration paths to the cloud that are too costly to justify for now.

So, will traditional enterprise data centers soon go away?

The honest answer is that the movement to cloud, MSPs, and/or colocations will continue to reduce the demand for traditional enterprise data center space. However, remember that those options are themselves data centers. Many enterprise data centers will simply be repurposed for public clouds and other providers, which will continue their rapid growth.

Of course, cloud platforms should be much more efficient, given their improved approaches to resource sharing, such as tenancy mechanisms. Thus, we should be able to do much more with much less, burn fewer watts, and emit less carbon.

On the flip side, cloud and virtual resources such as storage and compute can now be easily allocated with a few clicks of a mouse. Right now, the fast and easy availability of resources often proves too tempting for IT to resist. The rapid expansion of these resources in production will create more systems redundancy and inefficiency, this time in the cloud providers’ data centers. When an enterprise uses a cloud provider’s data center instead of its own, overall data center usage typically remains about the same as before or even increases.

Of course, cloud providers can manage their data center space much more efficiently than most of the enterprises that utilize their services. Economies of scale come into play because they manage operations, security, and usage monitoring for hundreds or perhaps thousands of enterprises, usually with the same amount of data center space that a single enterprise might have leveraged in the past.

It’s clear that alternatives such as MSPs, colocation providers, and cloud-based options are more cost-effective than traditional enterprise-owned or leased data centers. However, I’m not sure we’ll see data centers disappear from our skylines anytime soon. Many will simply be repurposed. It’s also likely that enterprises will rapidly expand the use of cloud services and thus drive more data center growth at the provider level, which will then require additional building and repurposing.

We’ll probably see just as many or more data centers in the future. However, we will leverage them much more efficiently than when enterprises owned them directly. I’ll still count that as a win.