Sunday, July 28, 2013

Colocation - Key Considerations for Selection of Service Provider

Increasing number of organizations are shifting towards Colocating the data centers as they see the inherent benefits like efficiency, security and other shared managed services. Colocation is offered as a service based on the standards, policies, procedures, people and the data centre infrastructure. The user experience depends on the quality of each of these components that form part of the service. The type of provider also drives the end-user experience because you get what you pay for. Given the significant benefits of colocation, CIOs cannot just ignore this as an option, but need to look for reliable facilities that upholds the needs of the organization.

The benefits of going for colocation service include effective use of capital and having higher quality facilities through power redundancy, cooling, and scalability/growth. Choosing a colocation provider is a strategic business decision that evolves from thoughtful consideration certain key parameters. More over, the partnership with the colocation service provider need a multi-year commitment from both. Listed below are some of the key considerations that help the CIOs to make a well thought out decision on choosing the right provider. The list below however is in no order of priority.

Customer & Partner Considerations
Many tend to focus on the organization's IT needs and base the decision to colocate and the choice of the service provider on such internal design parameters. However, the CIOs also have to consider the strategies of their customers and partners . For instance, in case of highly interconnected and collaborative partner systems, the DR sites need to have connectivity with the DR sites of the partner systems as well. If the service goes down customers will easily become frustrated with the company, especially if they are in a new market and are not long-time clients.

Power and capacity planning
The power supply is a key component of the shared services that the colocation service provider offers. Needless to say that it is a vital that the data center is supported with a scalable and reliable power supply in order to keep up the infrastructure components. The supplier should focus on the future needs of the customers and perform proactive capacity planning so that they are prepared to support the scalability needs of the organizaiton.

Designing and building a reliable and resilient data center would call for heavy investment and smaller organizations would find it difficult to justify the RoI for such investments. However, colocation service offers this benefit as the provider would however will be sharing the cost with multiple service consumers. However careful evaluation of the design and architecture elements that will contribute towards ensuring reliability and resiliency of the service is essential in making a decision on the choice of service provider. A carefull review of the SLA of any colocation provider is also very important to ensure that the service provider assures commits for the current future investments to support this need.

Security and technical advancement
With colocation, the organization is leaving its servers, equipments and the more precious data assets in the custody of the service provider, which usually is outside the physical security boundary of the organization. Thus, physical security to the premises and the assets hosted there in is an important component of the colocation service and needs a careful consideration and evaluation. A comprehensive security, beyond the guard, ensuring data protection at all times is what is required. Additional factors of security involving evolving technologies like biometric, card readers, keypad or electronic locks as well as surveilance cameras should form part of the security investments.

Network connectivity and proximity
Like reliability and resiliency, network performance is a key customer service issue, not just a technology issue. An ineffective interconnect setup or limited network system can lead to disruptions in the business operations. It would also matter much to ascertain the network latency associated with connectivity with partner systems. In most cases, if there is a need to have heavy amount of data or information exchanged with a particular partner system, it would be beneficial to have the data center closer to that of the partner's so that the latency between such centers could be as much lower, leading to faster and efficient communication. Network performance issues can have a tangible financial impact to the bottom line. It is usual that the colocation providers offer diverse options for internet access and a careful selection of a primary and redundant internet service providers is essential. 

Technology & support
The colocation service provider should be implementing standard facility design elements and integrating proven technologies so that better power and cooling capacities is achieved. The provider should also have the demonstrated expertise in facilitating flexible deployment of higher density solutions in an on-demand model. Despite the colocation arrangement, the IT heads of the organization are still responsible in addressing the business needs and as such a careful evaluation of the standards and practices that the provider follows in keeping up with the technology and trends is very much essential.

While most providers offer on-site 24/7 technical support, the skill sets in the offer could vary. Again the organization may demand a specialized skill, which the service provider might not be able to support. As such, it is important to compare the skills needed vis-a-vis the skills on the offer and make appropriate decisions. Similarly, the maintenance windows of the service provider for certain support services could be different from that the organization would want. Thus this is another component that needs careful consideration.

Flexible commercial terms
While the key benefit of outsourcing is the shift from the capital investment to operational expenditure, CIOs might endup spending way higher unless a carefull evaluation of the commercials attached to each of the specific service or component that forms part of the colocation service. Ideal cloud service provider would let the customer to pick and choose the components and also offer multiple and flexible billing options to choose. A careful choice is required to ensure to optimize the value realization out of the colocation engagement.

Locational Constraints
Despite having on-site technical support, there would be emergencies needing experts to visit the data center to physically visit the location and work on solutions. As such, the geographical location of the data center(s) does matter to the organization and needs careful consideration. Similarly, local issues like frequent political unrests, frequency of natural disasters in the region, proximity to the airport, etc need to be considered. For instance if the data center is located in a flood prone area, there is a high risk of the data center services getting affected.

Regulatory Compliance
Various countries and states have legislations that could have an impact on the data or other assets that is being housed at the colocated data center.  For instance, UK and US have privacy and security legislations that have an impact on the way the information is stored, processed or disseminated. It is also beneficial to have an insider’s view and legal opinions where needed.  A provider located in a flood plain or an area prone to hurricanes creates unnecessary risk for the business.

Given that most businesses are technology driven, the regulatory and legal needs warrant that the audit of systems and facilities and thus calling for appropriate arrangement with the provider to support this need. The  provider may be requested to share copy(ies) of a SAS 70, SOC 2 or such other audit report, which represents a third-party validation of internal process and controls.

Cost is also an equally important aspect to consider. However, many times, it may not make sense in just considering the cost and instead it should be considered in line with the tangible and intangible value that could be realized out of colocation. For instance, better network performance would benefit as there could be faster and increased acceptance of the systems by the customers and partners resulting in expanding the market. Similarly, better security services might protect the organization from potential liabilities that may arise in future on account of security breaches. Thus the lowest cost isn’t necessarily the best for the business. Lack of support, insufficient product lines or unreliable data center facilities can end up being very costly later on. 

Green IT
The power consumption of a data center is way higher than a regular office premise. Colocation by itself would contribute towards optimizing the energy consumption as it would be a consolidated specially built facility shared amongst many. However, it is worth exploring the measures that the provider has in place towards conserving energy. and such other green practices in place.

While the above considerations are generic, certain other considerations might be vital for some organizations depending on their business nature and priorities. This list can be further updated based on the feedback and comments from the readers.