Data Centres Are Bright Spot in Troubled Economy

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Even as IT budgets are slashed, data centre spending remains steady, signaling a bright spot for solution providers delivering data centre optimisation technology for customers.

While the headlines scream about the economy’s downward spiral, it seems there’s a bright spot, at least if you’re a data centre manager. More than half of data centre managers surveyed by AFCOM, the leading professional organisation for data centre management professionals, said their budgets would remain intact.

This is great news for solution providers whose customers are looking to integrate new, efficient technology focused on storing more data more securely and with a decreased impact on the environment, says Jill Eckhaus, CEO of AFCOM.

“Back in November, 46.9 percent of data centres were seeing an impact on their budgets,” Eckhaus says. But instead of seeing gloom and doom in those numbers, Eckhaus believes there’s a silver lining.

“What that means to us is that over 50 percent of respondents weren’t seeing an impact on their budgets – which means the majority of corporations realise that the data centre is the lifeblood of their organisations, and that they need to focus on keeping their data flowing, secure and optimised,” Eckhaus says.

Of those data centres that were impacted by budget cuts, Eckhaus says the survey data showed that the average budget cut was 15.2 percent. Again, she’s optimistic about the meaning of this number.

“Really, 15 percent is a relatively small number when you consider the percentages of the work force laid off, projects cut and budgets frozen or slashed in other industries, and even in other IT areas,” she says.

She adds that respondents reported that 37.2 percent of those budget cuts would affect equipment purchases. Many respondents agreed that their budgets would shift to priorities such as virtualization and disaster recovery to ensure that data was delivered and stored efficiently and securely without requiring expensive infrastructure upgrades or additions.

“We saw an incredible increase in the number of respondents moving to virtualization,” Eckhaus says. “Two years ago, we began educating members on virtualization, but they weren’t ready for it,” she says.

In the survey conducted November 2008, 86.2 percent of respondents plan to increase their reliance on virtualization to cut down on infrastructure expenses, Eckhaus says, an indication that this trend will definitely increase in popularity and adoption rates will soar. And as the push to “go green” gets stronger, many organisations are seeing both the environmental and business benefits of designing and maintaining an energy-efficient data centre, she says.

“There’s so much focus today on energy usage, space concerns and cost-cutting that these members really need to do things like consolidate servers, turn off servers they aren’t using and expand or build new facilities based on LEED certifications,” she says. In many cases, these projects don’t have to cost a lot to have a huge impact on an organisation’s spending.

No single topic is as controversial in the data centre space as the introduction of cloud computing. It promises energy savings, streamlined data centre management, higher efficiency and requires fewer personnel to manage. But many data centre managers remain highly skeptical of the technology, Echkaus says, with 77.3 percent of managers of 133 large-scale data centres saying they have no plans to increase their usage of the cloud.

Eckhaus believes that moving applications and data to the cloud will be a slow process, and that adoption will follow the pattern set by virtualization technology.

“Right now, there’s not one clear definition of what cloud computing is, and that can be unnerving,” she says. “There’s a lot more education that has to happen for our members to understand what it is and what they’re getting into before they take the leap,” she says.

One of the main focus areas for AFCOM will be education of its members, Eckhaus says, which by touting the benefits of the technology will help ease members’ fears. She says a main concern is the loss of control over data, data security and information management.

“Any technology that can be seen as taking away internal control and placing new restrictions and policies on this data is going to be met with a lot of skepticism from these guys, so it’s going to have to be a slow and steady process,” she says.

While cloud computing remains controversial, disaster recovery solutions are the polar opposite, says Eckhaus. Organisations are learning from the lessons of past disasters to better prepare for earthquakes, hurricanes and fires by beefing up their investments in disaster recovery solutions.

“This is an area that members say is easy to ignore, but they’ve been really pushing for these technologies, she says. “They know that if the data goes down they can stand to lose thousands of dollars each hour,” she says.

And these disaster recovery solutions don’t just take data security and recovery times into account, says Eckhaus. Data centre managers understand that there are considerations outside of this like, how to get people to a site that’s been affected, how to protect them against further harm and injury and to ensure they can get their jobs done safely and securely.

As the importance of the data centre to companies’ livelihood increases, AFCOM continues to grow. Currently, the organisation has about 4,500 members representing almost 4,000 data centres within companies across nearly any market imaginable.

“We’ve been growing by leaps and bounds over the last couple years, which is indicative of the increased profile of data centres,” she says. “This really puts extra pressure on data centre managers to keep up their education, to network with and learn from their peers to be better prepared for whatever may come,” Eckhaus says.