BPO companies top data center spending -- study

04 Aug 2006

Companies categorized under business process outsourcing (BPO) make the largest investments in data centers, according to a recent Frost & Sullivan study.

According to the study, presented by UPS vendor American Power Conversion (APC) in a briefing last week, the IT and IT-enabled services sector accounted for more than 40 percent of data center investments in 2005, followed by manufacturing and telecommunications segments, respectively.

Surprisingly, the banking and financial services industry, is trailing behind but is nonetheless considered by Frost & Sullivan as among key industries that will drive investments in back-end systems.

Sanjay Singh, director of industrial technologies practice at Frost & Sullivan Asia Pacific, said that for these segments investing in data centers, scalability is one important consideration.

"The important considerations in investing in a data center are scalability, manageability, security, reliability, and support. Scalability has a direct impact on the future cost of expansions of the data center," Singh said.

The scalable data center, as described by Singh, is a "build-as-you-go" data center. End users can add on modules into existing data center infrastructure when the demand and need arises. The scalable data center represents new improvements in data center technologies.

"It's better to build a small data center with higher efficiency than large centers with lowered efficiency. It's better to build-as-you go, than build then pray that you have enough content to fill the data center," Singh said.

The benefits of building a scalable data center include: allowing for upgrades into more advanced technologies within a shorter time frame; and lowering risk of entire data center failing due to power outages compared to a centrally controlled data center.

High-density data centers have arrived with the advent of blade servers. But as system density increases exponentially, so does heat generation. These new generation blade servers consume more power and generate more heat. Back-up power and cooling become essential aspects of data center planning.

"In the study, 72 percent of the end users think that the loss of services and revenues is the most detrimental impact to their businesses in the event of a power loss. This is not something to be taken lightly so back-up power is crucial," Singh said.

Equally important as back-up power in data center planning is cooling. Insufficient cooling may increase potential system meltdown due to high core temperature.

"Cooling translates to potential cost savings in the long run so investments in precision cooling is important," Singh said. --Computerworld Philippines

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