Lease versus build: The data centre debate

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Industry reports reveal that a growing number of both small and medium size companies are also considering the leasing option. - Herbert Radlinger, head of data centre services at eHosting DataFort.

Data centres - ‘to lease or to build?' That is the question for organisations across the globe today. The truth, however, is there cannot be one answer. eHosting DataFort's head of data centre services, Herbert Radlinger, mulls over the possibilities.

Leasing or outsourcing your data centre to a specialist team dedicated to managing IT services means they carry the risk and are able to offer the support you need to focus on core activities. Keeping the management of data centres or servers in-house may be more suitable for other organisations that can afford the staff capacity and the upfront capital to invest in the IT infrastructure required to operate their business. It all depends on your financial model along with a number of various factors.

Given the current economic conditions, however, industry experts are witnessing a sizable shift towards the former where more and more companies, particularly in the region, are looking to find ways for IT investments to boost productivity, increase business efficiencies and enable innovation without the need for capital investment. In fact, while multinationals have paved the way in leasing data centres to specialised third parties, industry reports reveal that a growing number of both small and medium size companies are also considering the leasing option.

There are, however, a number of factors to consider before taking the plunge - factors that would also help both CIOs and CEOs to decide whether leasing or building their own data centre is the way forward:

Flexible Business Model

A major driver in opting to lease data centre services is the need to find a business model that works in a climate that is unpredictable. Companies today are looking to lease their data centres that enable them to adapt to a volatile economic environment and capitalise on a service provider that offers skilled resources and standardised processes for the efficient delivery of IT operations.

In addition, more and more organisations are moving from investing in upfront capital expenditure (CAPEX) to an operational expenditure (OPEX) model that allows companies to ‘pay as you go' and reduce overall risks. At the same time, a guaranteed level of service is offered with managed service providers offering high-end service level agreements.

Core-Business Focus

Organisations also turn to leasing data centres because of the need to focus on its core-business activities. A survey conducted in the region recently revealed that given the increasing complexity of networks, many organisations were open to the idea of having their data centres managed by a third party company with the skilled manpower and process maturity for IT support and service delivery. An experienced team of qualified resources is key in providing reliable service levels and for optimising the use of latest technologies available in the market.

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