What Success Looks Like
A while back, we visited with a colocation provider at their facility outside a major metropolitan area. They told us about a client who had a decision to make involving 50 distinct workloads.
They were about to lose to another provider because their competitor had an established connectivity link which they required. The account executive persuaded the client to consider how many of these workloads actually required this connectivity… in other words, to do the analysis to define their requirements.
The client went back and did their homework. They found that only eight (!) of the 50 workloads required the more expensive services.
The savings realized on the other 42 workloads? 30%.
The answer is always, always, always in the analysis.
The Future is Hybrid
From the previously safe harbor of the on-premises data center, workloads have shifted – and continue to do so- inexorably away from enterprise-owned facilities. Gartner estimates that by 2025, 80% of enterprises will have shut down their traditional data center versus 10% in 2020.
This doesn’t imply that everything is headed to the public cloud. There’s a subset of workload which will remain on-premises for reasons which can be summarized as “latency, legacy and legal.” And there’s a further subset for which the business case for cloud migration just doesn’t close- stable workloads which don’t benefit from the agility provided by the public cloud, and which require work (and expense) not only to migrate, but to prepare for the cloud.
So the future state, for almost everyone past some level of scale, is a hybrid infrastructure which once realized, will meet, even anticipate, the needs of the business in a fashion that enables the business while fulfilling Infrastructure & Operations’ traditional role of protecting the business.
Sometimes, the End State is Easier to See than the Roadmap
It’s complicated, this business determining the best execution venue (a financial term applied by 451 Research to workload placement). It’s not as simple as a “cloud first” mantra or the mere selection of a primary partner. Even colocation based on connectivity is a continually changing market as mid-tier providers add capability.
“It’s a journey” financially as well as in every other sense. Cloud can be more economical than on-prem, but it can take several years to get to that end state and there can be surprises along the way.
Among those surprises can be egress fees. A simple internet search on “cloud egress surprise” will provide plenty of insight, and the NASA story is perhaps among the best known.[i] An oversight study pointed to “…potential risks that scientific data may become less available to end users if NASA imposes limitations on the amount of data egress for cost control reasons.”[ii]
Of course, more regulated industries have a higher bar for security. No one has the appetite for violations and the resulting fines – and more importantly the loss of reputational capital. Finally, many organizations do not base their development platforms solely on hyperscale cloud providers.
To get to the right strategy – the right resource allocation – requires understanding all of the available alternatives.
Examining All of the Alternatives
GTSG takes this challenge seriously and constantly surveys the marketplace for change. For example, colocation providers have increased their investment in connectivity over the past decade. Most people know that Equinix made a big investment, that CoreSite has invested on its more focused footprint, and that Digital Realty has entered this sphere in a big way. More recently, such midtier providers as Involta, Tierpoint and Flexential have also made this investment and might be a terrific fit for a given firm depending on its particular requirements, including their geography.
Similarly, there is more to the cloud than the hyperscalers. One provider GTSG met in connection with our Federal business has had success by meeting the specific needs of its clients – needs discovered by understanding the marketplace first for Federal environments, obviously highly regulated, and now in the commercial marketplace.
This provider, ORock, has successfully earned business with
- a software provider utilizing Red Hat OpenShift Container Platform to showcase its practices in DevSecOps and Data Analytics;
- a financial services firm requiring its advanced cloud environment to be architected specifically for secure data operations and white-glove service- and with a predictable pricing model without egress fees;
- a managed services provider whose government security requirements were a perfect fit ORock’s FedRAMP cloud environment.
An Unbiased Partner, Studying the Marketplace for our Clients, Not Commissions
GTSG brings a deep knowledge of this industry built over our 33 years. We believe strongly that it takes not only analytical rigor, but also a deep understanding of a constantly changing provider landscape to get you to the right answers in your workload placement strategy: for the clients you serve and the business you need to enable and protect.
If we can help, please write Partners@GTSG.com
[i] https://datacenterpost.com/egress-expenses-minimize-surprises-and-maximize-data-availability/#:~:text=When%20users%E2%80%94the%20scientists%20analyzing,GB%20would%20cost%20%2412.35%20million., retrieved 6 May 2021
[ii] https://www.oversight.gov/sites/default/files/oig-reports/IG-20-011.pdf, retrieved 6 May 2021