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Data Centre Design & Build – Understanding the True Cost

3rd, September 2018

Price is often a deciding factor when it comes to opting for one solution over another, however what is often overlooked is the Total Cost of Ownership. The saying ‘buy cheap, buy twice’ can often apply. By integrating ‘cheaper’ equipment into your data centre may well end up being a false economy. Not just with regards to the life span of said equipment, but also the ongoing operating costs.

The ONS found that in 2018, 90% of adults in the UK were recent Internet users, and with the rise of technologies such as AI, it is estimated by IHS Markit that there will be more than 31 billion IoT connected devices in 2018.
This technology is used to access, store and process data, all of which passes through one or more data centres.

A data centre is one of the most financially concentrated assets of any organisation, yet few companies understand the true cost of building and operating such facilities.

Data centres account for approximately 2% of the total global energy use and subsequently infrastructure efficiency is an area of increasing focus. A key metric is PUE which is calculated by dividing the Total Data Centre Power Requirement by Server Consumption. According to the Uptime Institute the average operational PUE is 1.7. In the UK, the new data centre target is 1.2-1.5 with most efficient designs aiming for 1.15 or lower.

Therefore, some customers demand increased efficiency, even if it increases the initial purchase price of the IT hardware.

When calculating the Total Cost of Ownership, the whole physical infrastructure means all the facility equipment needed to provide power, cooling, and physical protection of IT equipment, but not the IT equipment itself.

According to a White Paper by APC, the Total Cost of Ownership of a rack within a data centre is approximately $120K over the data centre lifetime. Approximately half of the lifetime per rack TCO of $120K is a capital expenditure, and half is operating expense.

Breakdown of TCO cost components for a typical rack in a high availability 2N data centre;

• 20% – Electricity
• 18% – Engineering & Installation
• 18% – Power Equipment
• 15% – Space
• 15% – Service
• 6% – Cooling Equipment
• 5% – Project Management
• 2% – Racks
• 1% – System Monitoring

Ensuring that your data centre is fit for purpose will also ensure that efficiencies are achieved. Rightsizing could reduce the cost of infrastructure by 60% by considering deploying a data centre that is scalable and modular.

Many components of a data centre such as UPS, power distribution and air-conditioning can be deployed in a modular and scalable method. When deployed over time to match the actual requirement of your business cost savings are realised, not only for the equipment itself, but also for service contracts and electricity.

Therefore, the questions that need to be answered are; Is your planned data centre energy efficient? Is it scalable to meet your current and future requirements? And Is the decision to possess your own data centre the most cost-effective solution or would opting for a colocation solution be advantageous?

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