Why smart IaaS provider does not build its own data center?

Although providers with their own data center have certain advantages, including more control over the infrastructure, the disadvantages of this approach often outweigh. This is the need for large initial investment, and the complexity of scaling. Therefore, let's consider why a good IaaS-provider should not build its own data center.

Own DC is a big expense

The research agency SP Home Run says to build a data center will have to allocate about 10 thousand dollars per square meter. It is necessary to take into account the costs for servers and storage systems, purchase of licenses, electricity and cooling expenses. The data centers are very hot, and it is believed that the cooling of the equipment takes most of the power consumed. Do not forget about the additional costs for cable channels, lighting, fire systems and the server equipment itself. It turns out that the IaaS-provider, owning its own data center, is faced with another expense item - a regular update of the equipment. Yes, the old equipment can be sold, and the income can be used to buy a new one, but often sold servers do not bring much benefit.

Increases reliability and security

IaaS-provider with its data-center falls into the conditions of serious competition. He will have to provide quality infrastructure services and at the same time "compete" with other data centers, which in many respects will certainly win.

More options for customers

By giving control of the data center to outsourcing, the cloud provider gets access to numerous telecommunications providers. This allows its customers to choose the best connection option for business and protect the infrastructure from equipment failures (through the use of reserve capacity). In addition, the choice of an Internet provider creates a competitive environment that gives customers the opportunity to select the most advantageous connection packages for their high-performance services.