Kara Manon Choosing a data center: build versus buy

May 23, 2012 by · Leave a Comment 

There are many things to consider when choosing a data center including the decision of whether to build or buy. There are pros and cons with either decision but we believe the cons to building far outweigh those of buying or leasing space. Obviously, as a data center, we realize it’s incredibly shocking that we’d suggest buying over building but we’ll tell you why so you can make an educated and informed decision on your own. Whether you are moving equipment because of downtime, out of space or power, or just because you want to feel your IT equipment is more secure, here are a few factors to consider.

1. The money you spend building a redundant, highly available data center could be spent on other projects that are more closely related to your business strategy and your bottom line. When building, the higher the redundancy and tier of the data center, the higher the cost. Leasing space saves you a massive amount of upfront capital.

2. While we’re on the subject – capex vs. opex. Whether you build a data center or buy space in one, you will have ongoing operating expenses. The only variable in this decision is the capital expenses you will have to shell out to build a data center. The upfront costs of leasing space are minimal in comparison to the capex for building and are roughly equivalent to one month of recurring fees.

3. You can still have control without spending a large amount of money to get it.  To build a data center, if you aren’t in the data center business and it is not your core competency, you would have to spend a lot of money to hire someone to design and build it, not to mention staffing it with people who know what they are doing. If you lease, you can utilize expertise of onsite data center staff and you will know that the facility was built to be a data center and was strategically constructed to optimize uptime and security. Not only that but some places, like Data Cave, allow you to customize your own “suite” which means you can choose the room’s supporting equipment, the layout of the duct work and racks, along with a number of other options.

4. Another consideration is time. How quickly do you need it to be ready and can you afford to wait? When you lease, the space is usually available right away but building can take at least a year, if not longer.

5. How much do you plan to grow? When building a data center, you have to take into account the growth of your company and your data. Can you guess how much space you will need in 15 years? If you don’t grow at the rate you anticipate, you still have to manage and operate the other portion of the data center you built that is unoccupied. Under or over provisioning can cause any number of problems. If you over provision, will you then need to bring in tenants to fill the space and do you really want to be landlords? If you under provision, you could run out of space, power or connectivity and then have to make the same decision again: build more or buy. Leasing space allows you to easily grow your footprint at your own pace.

6. If you build a data center, you are responsible if something breaks. There could be a large number unexpected problems, not to mention the ongoing maintenance of equipment. At facilities like Data Cave, there is onsite staff to take care of equipment maintenance and the data center is obviously responsible for their own equipment. All you have to worry about is what’s in your racks.

7.  How much risk  are you willing to take? When you lease space, you’ll have a very predictable cost. However, when building, as mentioned, any number of problems could occur. The costs associated with building are incredibly unpredictable. Leasing space at a data center will be much more cost effective and far less risky than building and owning your own data center.

There are a number of other factors to consider but now you have a general idea of the things that should be a factor in your decision. We have a few whitepapers that can also help you with the decision to build or buy such as our whitepaper on The Top Ten Reasons to Colocate. Don’t hesitate to call us if you’d like more information 866.514.2283.

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