If Everything is a Service, Why Do We Need Data Centers?

By Pino Vallejo

Imagine a remake of the original Indiana Jones movie, Raiders of the Lost Ark. Eerie music is playing during that iconic final scene. The camera closely follows a clerk pushing a crate containing the Ark of the Covenant. It pans out. In the 21^st Century version, the vast warehouse doesn’t contain endless rows of shelving and boxes. It is completely empty except for a desk, a computer and a shipping bay. Cut to a UPS truck arriving at the bay to take the crate to an unknown destination.

The IT version would be a data center manager sitting at a computer console in an otherwise empty basement. All the hardware and software that used to be neatly arranged in rows within that data center is now in the cloud. Could this be the fate that awaits us if Everything-as-a-service (XaaS) progresses to its logical conclusion?

“That vision of a manager in an empty data center could eventually apply to some businesses,” says Colm Keegan, a senior analyst at Enterprise Strategy Group. “In those cases, the data center manager’s job would be the overseer of external providers to ensure the enterprise received the performance and capabilities it required.”

This, however, would be far from a passive role. The data center manger would have to be engaged with all providers, monitoring their service levels, and constantly looking to improve performance and lower costs.

“You need visibility into operations, oversight into the health of your applications, and the ability to keep track of the usage of those services to understand why costs might be running high,” says Keegan. “You are always going to need a skeleton staff as who else is going to find out what’s causing inefficiencies such as orphan systems running in the cloud that were never decommissioned?”

The duties of the data center manager in an XaaS world, therefore, would be that of an analyst and liaison between internal business users and the cloud providers. In an initiative to add greater analytics capabilities, for example, it would be up to the data center manager to scope out the requirements and costs with the cloud provider in order to translate that business need into a technical capability. In many ways, then, the data center manager becomes the conductor of an orchestra of service “instruments” that would otherwise quickly descent into a cacophony of chaos.

Another aspect of control is keeping IT in the driver’s seat and the enterprise secure. If there are official cloud providers serving the company as a whole, then there are alternatives out there seeking to tempt line of business managers to go rogue and use their services instead. Preventing this from happening—and opening insecure avenues into the enterprise—requires the data center manager to stay on top of how well official service channels are meeting business objectives.

“Your internal customers care about it being easy to do business with you,” says Keegan. “If service is poor, slow, complex or pricey, they will find a way to do business with someone else.”

Hybrid Data Centers

Of course, the vision painted above may not necessarily come to pass. There will certainly be very large data centers run by service providers and IT behemoths like Google, Yahoo! and Facebook who have discovered the benefits of building their own data centers and cutting out the middle man. Equally, some larger businesses may choose to keep a major IT arsenal in house due to compliance/security mandates, corporate preference, application cost or poor cloud service.

In many other cases, the likelihood is that a hybrid model would result in part cloud and part internal data center. Take the case of Acorda Therapeutics which has two data centers. The primary data center near New York City has 20 physical servers, 17 of which are host servers for its virtual infrastructure consisting of 360 virtual machines (VMs). It also includes two Storage Area Networks (SANs) and redundant water-cooled A/C units. Redundant UPS units can each power the data center for 30 minutes, more than enough time for the diesel backup generator to kick in, which could power the data center for 36 hours without the need to refuel. The second data center serves applications specific to its manufacturing, lab and business operations in Massachusetts. It has 30 physical servers and 12 virtual servers.

The company runs some applications in the cloud and others on premise. Cloud apps include project management, expense reporting, payroll and sales reporting. On-premise apps include file sharing (EMC Syncplicity, which can synch cloud and on-premise data), manufacturing systems, lab operations, document management, clinical trial management and drug safety.

“Many of our applications will likely stay on-premise for the foreseeable future due to the nature surrounding the sensitivity of the data and compliance requirements,” says Joshua Bauer, assistant director of network operations at Acorda Therapeutics. “Any server that connects with any physical components, such as our lab or manufacturing operations must stay on-premise. Everything else will likely be transitioned to the public cloud.”

He sees the XaaS space continuing to grow, until it levels off with around 80 percent of hosted data. The remaining 20 percent will be for environments, he thinks, that are heavily regulated and/or tied to custom hardware such as manufacturing operations or any systems that serve custom-built processes.

Staying Relevant

This approach demands a shift in role for the data center manager. Keegan stressed the importance of a seamless transition between cloud and in-house data center service. The key here is being able to straddle either side and put in place tools that can work with both.

“It is likely that the traditional data center, as we know it today, will contract to support mainly mission critical workloads like online transaction processing systems, key financial applications and anything that is bound by regulatory compliance,” says Keegan. “Non-core workloads that are not directly material to business revenue like email, end-user productivity applications and CRM will increasingly be outsourced to Software as a Service (SaaS) providers.”

According to an ESG survey, the functions most likely to remain in house are accounting, financial, human resources, business intelligence, analytics, project management and industry-specific applications (Figure 1).  Even workloads, like test/dev will begin to find a home-in service provider with Platform-as-a-Service (PaaS) environments.

“Hybrid cloud computing will emerge as the preferred method for traditional enterprises to manage their business application workloads: mission critical apps on-premise and non-core apps off-premise,” says Keegan.

With so much change on the horizon, what does a data center manager do who has lived to see his or her basement empire dwindle from a place packed with racks of servers, storage arrays, tape systems and assorted IT gear to the point where only a few racks are left? On top of that, a notice arrives on the desk saying that the data center is being moved to a much smaller space?

To stay relevant, existing enterprise data centers need to be more agile and responsive to the needs of the business, and they must empower internal end-users by providing them with many of the same self-service and IT infrastructure on-demand capabilities that are available in Amazon Web Services, Azure or Google.

“Application developers don’t have time to wait for IT to design, order, integrate, configure and provision resources over many weeks,” says Keegan. “If data centers want to survive, they have to become the ‘vendor of choice’ for these internal customers, and that means making it easy and quick for them to dial-up resources when they need them.”

That doesn’t mean only trying to keep everything in house. It is up to IT to determine when it’s best to deliver services internally or farm them out externally. But the data center manager has to know which providers to use when, and also create a framework that makes it desirable to utilize internal resources.

“IT organizations need to understand what the needs are of their internal clients and provide multiple avenues for them (hybrid cloud) to attain the services and resources they require to innovate and pursue new revenue streams for the business,” says Keegan.

Winning Strategies

Clearly, data center managers have to adapt or risk slowly fading away. Bauer’s advice is to study their opponents in this contest—the cloud providers—and see what practices they use that can be imported into the data center.

“To keep an existing enterprise data center relevant, companies should leverage technologies and practices that the larger data centers offer (on a much smaller scale of course),” says Bauer.

Similar to how local merchants have to adapt in the face of competition from the Walmarts and Home Depots of the world, the key is to find a niche and offer more personalized or customized service. Deliver what the larger providers can’t, which is customized and more personal service, adds Bauer.

He stresses brutal honesty by data center managers in the battle of cloud versus on-premise. If they do so, they will realize that there are already many off-the-shelf, or otherwise standard applications that are well suited for the cloud. To stay ahead of the game, therefore, IT professionals who manage on-premise data centers should manage the process of transitioning these applications to the cloud, or risk being left out in the cold when someone else decides to do it on their own. This leaves IT to focus on the more customized, regulated and sensitive applications which remain in house.

But there are some cases when it could be time to abandon ship.

“It may be time to let go of an internal data center if it becomes cost-prohibitive to maintain it or there are no more applications present which cannot be hosted in XaaS,” says Bauer.

Greg Schulz, an analyst with Server and StorageIO Group, concurs.

“Some environments, big and small will eliminate their data centers altogether by moving to an outsourced, managed or cloud service,” he says. “The key will be how data center managers and infrastructure technologist can revamp their service offerings to become a flexible business enabling asset instead of a cost overhead barrier to productivity.”

He lays out a series of tips on how to not only survive, but thrive in this brave new world. This includes some that are straight out of the cloud service play book:

Push Back

Finally, the data center manager should be willing and able to move applications from the cloud back internally if circumstances require it. Perhaps applications performance just doesn’t live up to expectations or security mandates require it to be brought inside. Just as importantly, costs can sometimes dictate what has to return to the data center.

“I’ve talked to businesses that dumped most of their usage of major cloud providers due to high costs,” says Keegan. “They liked the service, yet ended up pulling many workloads back on premise due to rising costs.”