Issue link: https://cp.revolio.com/i/886554
THE DATA CENTER JOURNAL | 7 www.datacenterjournal.com technologies allow companies to meet the growing demand for IT services without huge budget increases. Absent such a technology transition, one would expect quickly growing budgets as companies rely more on IT for their business functions. If IT is in a steady state technologically, therefore, flat budgets indicate something is gravely wrong with the industry or with the broader economy. But when the cloud transformation and its associated cost declines are part of the analysis, flat budgets make more sense and, indeed, become positive: companies are able to accomplish more at lower cost. For customers, that means less upward pressure on the price of goods and services, so everyone stands to gain. Wagner added, "In a study we did called the 'e Economic and Strategic Benefits of Cloud Comput- ing,' we showed that heavy cloud users on average spend 21% less on IT as a percentage of revenue and 16% less on IT on a per-user basis than other orga- nizations in their sectors that were less aggressive about the cloud." Of course, individual companies may benefit more or less from the cloud. Some, for example, are careless in their selec- tion of services, driving concerns that the value of the cloud is less than advertised. But when companies are considered on average, the Computer Economics data suggests the cloud is a clear cost saver; it's just up to each one to choose services wisely. e cloud has been a hot topic for years, but it's far from reaching its full potential. As long as it continues to enable such compelling cost sav- ings, companies will continue to adopt it for more of their IT functions. e practical (i.e., non-numerical) benefits are also compelling in many cases, because the cloud allows companies to focus more on their business and less on IT; the abovementioned hiring dy- namics attest to this observation. But there are limits. "Obviously, the cloud doesn't eliminate the need for infra- structure," said Wagner. "It simply moves the infrastructure. Inevitably, if the infrastructure doesn't continue to increase in efficiency, wherever it's housed, it will become more expen- sive. But I don't think that's the major driving force currently." Perhaps, then, the completion of the cloud transition will make itself apparent through a major uptick in IT spending. In the meantime, however, it will continue to hinder budget increases—and that, judging from the data, is a good thing. n print scale None Production Round 1F 2017_DataCenter_New_print_8.75x5.875_National.indd E F F ICIE N T NE W DATA CE N T E R, ME E T IDE AL E NE RGY PART NE R. You may not know about Xcel Energy's Data Center program. You may not have heard of the free personalized energy modeling services and rebates we provide. Or of our certified sites and data-center-friendly climates in Colorado and Minnesota. The sooner you learn about all the ways we can help improve the efficiency of your new data center construction or renovation project, the sooner you can start reaping the benefits. Learn more at xcelenergy.com/DataCenters. New construction and renovation projects with at least 1MW of IT load are eligible. © 2017 Xcel Energy Inc. T:8.75" T:5.875"