The Data Center, Cloud Services and The Edge
Virtual Roundtable Recap: The Data Center, Cloud Services and The Edge - Managing The Future Of On-premise Infrastructure Technologies
By: Mark Fong, Regional Vice President, Asia Pacific & Japan, Digital Realty
In 2020, the public cloud market will grow to $299.4 billion. The digital transformation created by COVID-19 is accelerating this trend, as businesses look to fortify infrastructure in the face of continued global uncertainty. With cloud adoption rising, how does the data center fit into this new ecosystem?
The data center along with hyperscale cloud providers and off-premise services, has created a more complex landscape of infrastructure choices that must be unified into a well-engineered and seamless experience. However, viewing facility decisions through a conventional IT lens is no longer enough. Firms need to plan for a new generation of facilities that maximise the opportunities available across expanding hybrid and multi-cloud services.
Our latest Virtual Roundtable discussion, which I had the pleasure of attending along with our Australia team – The Data Center, Cloud Services and The Edge: Managing The Future Of On-premise Infrastructure Technologies featured Sam Higgins, Principal Analyst, Forrester Research – examined these current challenges, bringing together senior IT leaders across ANZ to discuss the future of on-premise infrastructure technologies and what this looks like as we move into the next phase of transformation.
For those that missed the event, we’ve put together some key highlights from the event to help on your digital transformation journey.
Adoption and usage trends in Enterprise Computing
Infrastructure now spans the data center, cloud and the edge and we continue to see a shift in balance across these environments over time. Over the next four to five years, we expect to see the data center shrink as cloud usage continues to grow. However, what’s important to recognize is the notion of a data center or facility where the edge can exist.
Rumors of the data center demise are premature, with Sam Higgins noting that 40% of Australian firms are adding data center sites or capacity to improve user experience across the network. In addition, 19% of firms are deploying new data centers, triggering network purchases or upgrades in the next 12 months. What this tells us is there is tight coupling between the notion of connectivity and facility. Next generation data centers are migrating their strategy to help bring enterprises closer to cloud service providers, and this is really important.
We explored the concept of edge computing and the interesting trends causing the pendulum to swing towards cloud providers. We now see major cloud providers offering edge computing units that are managed and attached directly to the cloud infrastructures they’ve produced, for example Azure Stack, AWS, and IBM Cloud satellite.
Forrester has revealed that 31% of firms have adopted edge and 25% are planning to adopt. As a result, activity focused on cloud integration, consolidation of the data center and adoption of edge capabilities is going to come with a unique set of challenges including:
1. Legacy applications and underlying infrastructure which isn’t stable enough for consolidation
2. Lack of in-house capabilities and skills to successfully plan and execute the transformation
3. Inability to build a business case for consolidation
Unfortunately, infrastructure and applications remain key barriers to consolidation, particularly given the shift towards cloud-based infrastructure. Our roundtable discussion really highlighted some of these challenges in more specific circumstances for organizations at different points in the digital transformation journey.
When asked “How would you describe your firm’s enterprise computing strategy” our attendees talked about the rapid changes they are experiencing within their environment and how they are working to catch up on implementing cloud into their IOT strategy. For those going through this evolution, cloud adoption has enabled them to manage greater volumes of customer data, in a cost-efficient way. For example, enterprises working with AWS have been able to successfully manage, replace and deploy a large number of applications scattered around the globe.
Sam Higgins then asked about concerns in relation to the DC environment, this pointed the discussion towards the attractiveness of cloud adoption for enterprises looking to drive a stabilization program, which requires scaling up and scaling out capabilities. Our attendees agreed that a key benefit of an automation stack in this instance is an uplift in security posture and improved risk management across an organizations’ portfolio. The discussion highlighted that cloud adoption not only builds resiliency into the platform but also reduces costs associated with data center providers.
However, when asked about concerns with moving to the cloud, it became clear that cloud adoption is secondary for those organisations who have a stable, fit for purpose environment that is managed by a strong data center provider. This highlights that there may not be a compelling reason for cloud adoption, instead a focus on applications driven transformation could take priority. For example, implementing a core model to allow for deployment of all applications on one platform.
For some, connectivity was noted as a major challenge, particularly those within agri-business. Our attendees spoke to the difficulty in achieving innovation with cloud technologies because of communication barriers that exist within certain sectors. An example is finding equipment that survives the environment and relying on the mobile network to input data into the required platforms. This draws attention to connectivity problems that exist in adopting cloud systems and is reflective of broader challenges within operational technology, experienced by many IT leaders in the region.
The Impact of Hybrid and Multi Cloud
The roundtable participants explored a question high on the industry agenda: why do firms need to continue to pay close attention to the data center as part of a wider infrastructure strategy? With hybrid-cloud and multi-cloud at the center of decision-making, it’s interesting that 50% of firms in Australia use these terms interchangeably. Now, almost 70% of Australian enterprises utilize two or more cloud platforms in some capacity, shifting “hybrid’ and “multi” environments from strategic plan to reality.
According to Forrester, 87% of Australian infrastructure decision-makers describe their strategy as “hybrid” which demonstrates widespread adoption. Moreover, 49% are utilizing a hosted private cloud, 41% public cloud and 10% internal private cloud. So, what are the critical features when it comes to private cloud?
According to our attendees, it’s a combination of the following:
1. Cost efficiencies compared to a local data center
2. The security of the environment
3. Localised presence in key business hubs like Sydney and Melbourne
4. Connectivity and facilities management
When we talk about private cloud, the concept and challenges surrounding connectivity continue to be top of mind. Josh Munro, Executive Vice President of APAC from Megaport sees automation as a critical feature for customer experience by enabling large scale set up via APIs. However, Josh highlighted that without connectivity you can’t make smart decisions at a rapid rate, and a lot of the capabilities of private/ public cloud become useless if you can’t access them effectively. Thus, internet exchanges are becoming more relevant for interconnection points with CSPs moving closer to the edge to link key regions.
Next Generation Data Centers
To wrap up our virtual event, I discussed how organisations should plan for future challenges and demands. Evolution in the industry has seen consideration for retail colocation – which is no longer the obvious answer to the enterprise data center solution – shift towards scale facilities that hold the data. Whilst it’s crucial to understand how much connectivity is required, the more important question and focus is on proximity to customer data that allows for actionable data insights.
Data centers will continue transforming to enable tighter integration between the cloud and on-premise facilities. Flexibility is key to bringing enterprises closer to the CSPs. This creates a secure environment to evolve in line with demand and uptake seen by organisations across APAC.
Digital Realty in Australia
Digital Realty has been active in the Australian market since 2012, with the opening of our first facility in Sydney, Digital Erskine Park I. As of today, we operate a total of five industry leading Data Centers across Melbourne and Sydney – providing our global excellence for regional and multinational clients operating in Australia.
Australia has proven to be a global hotspot for innovation, with Sydney in particular offering startups and entrepreneurs the right environment to launch and nurture new businesses. With a vibrant technology and business scene, we are pleased to provide the resilient infrastructure and trusted digital foundation needed to support the huge number of global and local companies that are drawn to Sydney.
To learn more about our extensive data center assets in both Melbourne and Sydney please visit us online at https://www.digitalrealty.com/data-centers/australia
Ready to take your next step? Learn more and find out how some of our customers are relying on us to take the complexity out of growing to meet the demands of building a digital infrastructure. If you would like to know more about Building Digital Readiness, feel free to reach out via my email at [email protected] or read more online at www.digitalrealty.asia/platform-digital
Thank you for reading. Please do stay safe and well.