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Why reduction of data centres makes sense for organizations

Zafar Anjum | Sept. 23, 2014
“From a TCO standpoint, consolidation of data centres can reduce operational costs significantly,” says Kapil Uniyal, Global Head of Tech Mahindra Data Transformation in this interview with MIS Asia. “Hence, there is an urgency to consolidate the data centres to derive savings.”

Cloud computing has emerged from infancy to relative maturity as enterprises realise its power and potential to accelerate mobile adoption and cost benefits to derive higher efficiency. But as the dust starts settle on its adoption, enterprises are now seeking more intelligent ways to lower costs of cloud adoption beyond the lowering of storage costs. One area of focus is the reduction of data centres so that enterprises with a global workforce can do more with less. Apart from reducing the number of DCs worldwide, applications which reside in these DCs also need to be streamlined and secured better. And finally, the last bastion to face cuts - disaster recovery - is itself being subject to consolidation.

Tech Mahindra, a leader in the global cloud market, has been approached by its customers to transform their Cloud technology. Its project to consolidate data centres for a global oil and gas multinational corporation has allowed it to compress data centres across three continents and resulted in substantial cost savings.

A lower number of data centres translate to easier recovery processes and lower costs - the company saved US$10 million upfront and benefitted 37,000 users.

"From a TCO standpoint, consolidation of data centres can reduce operational costs significantly," says Kapil Uniyal, Global Head of Tech Mahindra Data Transformation in this interview with MIS Asia. "Hence, there is an urgency to consolidate the data centres to derive savings."

Cloud computing has already led to cost savings. And cloud storage costs continue to fall. Why then is there additional urgency to cut costs further for datacenters? Is it also because the storage capacities of datacenters are increasing?

Cloud computing has revolutionised the way we approach our IT solutions and associated costs. High cloud adoption rates are driven by non-critical workloads being moved to the cloud. As these comprise a relatively small portion of an organisation's IT spending, it is unable to reduce the total cost of ownership (TCO) for storage.

Data centers today are increasingly under stress due to higher workloads from influx of high data volumes driven by new technologies such as mobility and social media - which lead to more complex and high-end hardware and resource requirements. From a TCO standpoint, consolidation of data centres can reduce operational costs significantly. Hence, there is an urgency to consolidate the data centres to derive savings.

To cite an example, one of our large Australian telecom customers was able to realise 40% TCO savings over the five years after it reduced its data centres from six to two. Of the savings, new hardware contributed only 20% i.e. 8% of the total cost savings.

Apart from cost savings what other advantages can be achieved by such consolidation?

 

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