How moving to a data center can save your organization money

Organizations are demolishing server rooms and moving to data centers in droves. There are several levels of cost savings from making a move to a data center. However, how do you calculate that saving for your organization? Here is a three-step process that will help identify how much you can save, and where:

Capital expenses

Count all the capital expenses you will need for your company. Ignore sunk costs as you will need to absorb some of the losses from recent investments. Capital expenses you count should include the hardware and software you need to run your own server room. The bulk of this cost will come from the hardware.

Operating expenses

The operating expenses are the activities and cost of maintaining the server room and can include technicians, maintenance contracts, and infrastructure specialists. People costs are the largest part of IT operating expenses and will also be the largest part of your cost savings.

Indirect costs

There are also indirect costs other than capital and operating expenses that affect the organization. One such example is downtime due to network, internet, or even power failures. Some businesses will see losses for any kind of downtime. Another indirect cost is ramp up time. When you want to provision new services, you need to install additional equipment, etc. With a data center, you can order and get immediate access to additional resources.

Article by Rack Alley. Improve your uptime, reduce costs, and get world-class colocation and hosting at their state-of-the-art LA data center.