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In many ways, the relationship between enterprise organizations and colocation data center providers looks very different today than even just a year-and-a-half ago. The COVID-19 pandemic didn't fundamentally cause these changes, but it certainly amplified several existing trends.
Many of the services and support considered table stakes today wouldn't have been in the not-so-distant past. Services like virtualization, remote hands and eyes support, and more day-to-day provider management of clients' infrastructures, signify a major shift in how organizations interact (or more correctly, don't interact) with the physical data center. But more on that in a bit.
Other ongoing enterprise trends, like increased adoption of hybrid infrastructures and focus on connectivity, continue their pre-COVID climb up the priorities list. Questions about how enterprises can extend public cloud resources into private infrastructures, along with related compliance and hardware provisioning concerns, are becoming more common among enterprise data center clients.
How are these trends playing out in the real world? What are the ideas driving them? There are many factors influencing how the colo-enterprise/provider-client relationship is evolving.
Here are four major drivers transforming how colocation providers and their clients (and potential clients) interact in the future:
1. Growing sophistication
In the past, it was the hyperscale customers who would come into an engagement with very sophisticated and specific requirements for their deployments. Enterprise customers usually operated smaller deployments at much lower densities.
That is rapidly changing.
Today, more and more enterprises are rolling out highly sophisticated deployments, and often at higher densities. You only need to open up a smartphone and watch a video in 4K, order food through an app, or request a haircut appointment to get a hint as to why enterprise deployments are becoming bigger and more complex. Those are just consumer-level examples.
Now, imagine all the SaaS and other business applications enterprises use and create every day. It's no wonder that enterprise infrastructures have become more complex. Demand for ever-more robust connectivity and cloud integration services within the data center are also the norm.
The challenge for data center providers now becomes maintaining flexibility while offering the right mix of technology, products and services to help enterprise clients effectively manage the growing complexity of their infrastructures.
2. Increased virtualization and remote services
That mix of services has increasingly included remote support. Until quite recently, enterprise clients would have been hesitant to operate on a virtual or semi-virtual model.
We've seen that hesitation quickly diminish over the course of the pandemic. Social distancing meant that fewer of our clients' team members could be in the data center safely. So, they relied more heavily on remote hands and eyes services. In fact, over the last 12 months, we've seen a 35% increase in remote service usage.
In addition to day-to-day, on-site remote support, there is also more willingness to rely on the provider for fit-out support, or sometimes, complete fit-out management.
3. Location, connectivity and plugging into the cloud
connectivity has, and always will be, a primary concern for colocation data center clients. Questions about connection speed and fiber density aren't going away.
That said, those questions have evolved somewhat, and that has to do with the growing infrastructure complexity and sophistication we've already mentioned.
Location is now an added layer to the connectivity conversation. If you want to deliver products and services to your customers or end-users faster than competitors, your connection needs to be fast, but you also need to reduce latency. The best way to do the latter is by being as close to those end-users as possible. Data center locations in multiple strategic markets enable enterprise organizations to maintain proximity and avoid service disruptions by ensuring redundancy.
Related to location and proximity is cloud access. Hybrid infrastructures are mostly the norm for enterprise-scale organizations. Cloud providers are also some of the largest consumers of colocation data center services. If a given cloud provider and an enterprise organization use the same colocation facility, the data center can provide an ultra-low-latency, secure, direct connection between the enterprise client and their private cloud instances without going over the public Internet.
In order to set enterprise clients up for success, data center providers need to have both the infrastructure and strategic vision to accommodate the diverse networking and connectivity needs of enterprise clients. That includes having locations in in-demand markets, enabling easy on-ramps to clients' cloud instances, as well as the technology and know-how to help clients take advantage of the existing network topology.
4. Planning for the future
Finally, enterprises are becoming more proactive when it comes to planning for infrastructure growth. Historically, enterprise deployments tended to be smaller and commissioned in reaction to market forces—rather than as a result of a long-term strategy. However, enterprise deployments are getting bigger.
Whereas before, an enterprise organization may commission something in the range of 10 to 20 KW, now we're seeing those same enterprises deploying 100 to 150 KW.
The likely driver of this trend is that enterprise organizations have experienced more predictable growth. As enterprises can more accurately plan, there is lower risk in securing more space to anticipate future market demand and infrastructure needs.
In response, data center providers are thinking more modularly about designing and building the core and shell of their facilities. Modularity enables providers to go from design to build more quickly and efficiently. It also offers providers the ability to more effectively plan for and adapt to client needs. For instance, even if a given facility's current client base doesn't require higher density, building a data center to be high-density-ready signals to those clients that they can plan and scale their deployments more confidently.
The evolution continues
Even though the relationship between providers and enterprise clients has evolved, it's almost a sure bet that the evolution will continue unabated.
That said, the pandemic year not only accelerated current trends, it added new variables into an already dynamic relationship. As we return somewhat to normalcy, there are many questions about what aspects of the transformed colo-enterprise relationship will revert to a pre-COVID status quo, what will endure, and to what extent the evolution will continue.
Could this lead to the need for providers to create new services or expand current offerings?
To what extent will enterprise clients be more willing to offload day-to-day, direct provider management of their infrastructures?
If fewer people return to traditional offices, how will a geographically diffuse customer/end-user base affect clients' networking and connectivity needs?
Those are just a few of the questions, and it's likely that it will take time to uncover all the answers. However, these questions and ideas reinforce the very first point we discussed: that enterprise clients are becoming more savvy and sophisticated when it comes to what they expect from a data center provider.
That's why it's up to providers to be flexible and to continually search for new, innovative ways to deliver better services and support for clients.