Inflation Eating Away at IT Infrastructure Budgets

Cloud Repatriation to Colocation Can Help Control Costs

Everything is expensive right now and inflation has been up, up, and away for more than five years now.  You’ve chosen to read about business and technology, so you are aware there are myriad factors at play and no single reason for rising costs of around 25% since 2021.   It is something we all have to deal with. 

This new normal is busting tech budgets right and left.  Chances are your organization is having to actively and strategically manage your IT infrastructure budget and operations not only to meet your business needs, but to not blow through what you have budgeted as costs escalate throughout each fiscal year.

You’re far from alone among your data center peers.  In a survey of over 1600 data center professionals by Uptime Institute released earlier this year 79% of the respondents indicated that their management is concerned about IT infrastructure costs. 

In an effort to constrain costs increases many managers and technologists have isolated the public cloud as one place to look for savings, and there has been a growing buzz around cloud repatriation.  Flexera’s State of the Cloud report earlier this year indicated that 21% of both workloads and data have been repatriated from the public cloud.  

Cost Control in Repatriation: We’re in an era where those who pull workloads back in from the public cloud for reason of cost may not have a data center to plug in into. Maybe the company was born in the cloud or were primarily using cloud infrastructure when your company was acquired (or was doing the acquiring).  For companies without a data center placing repatriated data into traditional data center infrastructure deployment or a company-managed private cloud in a colocation facility introduces a welcome element of cost certainty, at least for some elements of your IT infrastructure. 

For the term of your contract with a colocation provider, which is frequently in the range of three to five years, many of your data center costs can become fixed.  Colocation enables you to project exactly what the space is going to cost you and typically you can lock in at least a certain term of pricing for your managed services.  Additionally, although your servers and infrastructure are in a private, secure area you fractionalize other shared elements of your infrastructure that are ready to go for you.  Things like security, managed services, redundant power infrastructure, fiber access and the like are ready and waiting for you, requiring no capital cost on your part. 

Locking in Costs:   If locking in a segment of your data center costs is of interest to you, we’d look forward to a conversation.   Email us at strategy@DirectLTx for information on fixed pricing in our highly redundant, fiber-rich data center.