Issue link: https://cp.revolio.com/i/141720
Even though it has gained a lousy rap, outsourcing is something every company does to one extent or another. (If you didn't manufacture or otherwise produce from scratch every last tool or resource you use, then you are guilty of outsourcing.) It enables companies to focus on their core specialties rather than having to invest time and money in peripheral tasks that others can do better. I T is no different: sometimes, trusting outside groups to handle delivery of your IT resources is the best business decision you can make. But given the variety of outsourcing alternatives— which we can break down roughly into colocation, hosting and the cloud—how should you navigate your options? Here's a look at the possibilities and how they might help, or hurt, your business. Know Thyself If you're considering outsourcing, you probably already have some idea of what you need and want in an IT solution. But don't discount the importance of having a clear picture regarding your company's goals and requirements; the more you know about your business situation, the better able you'll be to choose wisely among the outsourcing options. Consult with your department heads or other personnel to determine their concerns and expectations, and decide on the relative value of each aspect of your "ideal outsourcing scenario." Chances are you won't find a perfect option; you'll need to make some tradeoffs. Knowing what's necessary and what's just nice to have will enable you to make a realistic choice. The other danger that companies face in outsourcing is misguided expectations. For instance, you may have heard that colocation saves money—and in some instances, that's true. On the other hand, wading wantonly into colocation can end up costing you more than if you had pursued other outsourcing options or if you had simply maintained in-house IT. According to U.K.-based research firm Ovum, the nominal value of outsourcing contracts worldwide fell 33% year over year in 3Q12. The number of contracts signed over the same period fell 24%. Although some of this falloff could be due to concerns about the broader economy or last year's presiwww.datacenterjournal.com dential election, it may also be the result of growing concerns over the actual value attained by purchasing services outside the company instead of maintaining them in house. Regardless of the precise reasons, the lesson is simply that you shouldn't jump into outsourcing expecting benefits that may fail to materialize. Don't buy into the hype: ask serious questions about both the different options and the providers that offer them. Levels of Outsourcing The traditional IT option is to maintain an in-house data center, including all of the trappings (UPSs, backup generators, cooling infrastructure, networking resources, staff to support it all and so on). But this approach brings numerous hassles, such as high capital costs and the need for full-time staff dedicated to IT. On the other hand, it also has benefits: complete control of all IT resources, convenient location (usually on the general company campus) and a smaller "circle of trust" (those who have authorized access to the IT equipment). Outsourcing trades some or all of the benefits of in-house IT, but it offers its own upsides in return. Turning to outside service providers need not be an all-ornothing approach—it can involve a mix of different solutions. The options include colocation, which outsources the peripheral data center infrastructure (cooling, power distribution and backup, building space, network bandwidth, site security and so on); hosting, which takes colocation another step by adding to the list some or all of the IT hardware; and the cloud, which is a complete outsourcing of all physical and virtual IT resources. Again, these alternatives can be mixed and matched. For instance, a company might use colocation for most resources yet rely on the cloud for data storage and backup. Colocation: Focus on IT Maintaining a data center in house— apart, maybe, from a small implementation (a data closet)—requires a variety of peripheral infrastructure, ranging from cooling to power distribution to access control. If you want control of your IT equipment but don't want to eat the capital costs of all the other stuff, colocation is an alternative. A colocation provider offers space in a full-fledged data center, supplying all the cooling, network bandwidth, power distribution/backup and security you need to run your equipment. The following are some of the critical up- and downsides of colocation. Pros: •No capital costs for facilities. The provider pays all the initial expenses for the data center facilities; you simply pay monthly leasing fees for space. Because colocation providers serve a number of customers, the economies of scale can enable lower ongoing costs. •Faster rollout. The traditional data center approach involves site selection, permits, construction and on and on. That's months—or years— before you'll be online. Colocation enables much faster IT rollouts, since you will be using an existing facility. •IT ownership. Although the colocation provider owns the data center facilities, you own the IT equipment. You control upgrade cycles, software and everything else, allowing you to retain control of your IT destiny—one of the major benefits of an in-house installation. •Provider expertise. In addition to the expected costs in time and money, traditional IT deployments can have numerous surprise costs (installation THE DATA CENTER JOURNAL | 5