Wondering where your IT budget is going? Recent tabulations of data center costs show the rising costs of operating one could even threaten corporate profitability in some companies.
A recent report from global management consultants McKinsey & Company says data center capacity currently is growing 10 percent annually as businesses process and store more data. And the resulting cost of this growth is higher yet.
“With this spike in capacity comes a corresponding escalation in data center IT costs,” states the McKinsey report. “Today’s data centers account for approximately 25 percent of the total corporate IT budget, when you take into account facilities, servers, storage and the labor to manage them. This share will grow as the number of servers, the amount of power consumed, and the unit cost of power all increase.”
For example, overall IT spending is climbing at a rate of six percent a year, but data center facility costs alone are jumping 20 percent annually.
“The portion of the IT budget consumed by infrastructure and facilities is significantly reshaping the economics of many businesses,” the report states. “In information-intensive businesses like investment banks, telecoms and business information, data center costs are diverting capital from new product development, making some products and segments uneconomical and materially affecting margins. Without radical changes in operations, many companies with large data centers face reduced profitability.”
You can guess EasyStreet’s take on this: Considering the well-known inefficiencies in most corporate data centers, these rising costs sound like a good argument for outsourcing as a more manageable IT cost structure for more companies.
Data Center is realy a critical part of a company .For a co-operate companies its better to have their own data center