Colocation, cloud, managed services, and outsourced services are among the IT infrastructure terms we’re all familiar with, but their definitions can change as technology evolves. As services blend together and more providers offer more options how are enterprise users and providers defining the various IT infrastructure terms we’re used to today? And how are they using these various services in an effort to create scalable, flexible infrastructure solutions?
Jeff Gilmer of Excipio Consulting interacts with enterprise end-user clients daily on a broad spectrum of IT infrastructure services. He offers insight on his current definitions of various services, including colocation, cloud, managed services, and outsourced services. Jeff shares how large IT infrastructure consumers are shifting the way they define certain terms as the consumption of infrastructure services grows and changes.
You can listen to our conversation with Jeff in the player above and read the transcript below.
Kevin O’Neill, Data Center Spotlight: This is Kevin O’Neill with Data Center Spotlight, and I’m here again with Jeff Gilmer of Excipio Consulting. This is part of a series, Jeff has been with us a number of times talking about a wide range of IT infrastructure issues, and today we are going to talk about a wide range of IT infrastructure services, and data center services, define some levels of service, and talk to Jeff about what his clients are looking for out of each level of service these days. Jeff talks to a lot of different major data center and cloud computing users and his perspective on what they’re looking for with this range of services is going to be pretty interesting today, I believe. Jeff, thank you for joining us today, appreciate it as always.
Jeff Gilmer, Excipio Consulting: Yeah, thank you, Kevin.
Data Center Spotlight: Now we’re going to talk about understanding the differences between external data center providers today, and obviously there are a lot of different services available. We talk about a wide range of services, but there’s no real standard definition of a lot of these different service sets. What are the services that we’re going to talk about today, Jeff?
Jeff Gilmer: Well, yeah, you can kind of get into a lot of grey areas when you start talking to different data center service providers. Unfortunately, there aren’t standard definitions within the marketplace, so kind of the structure that we work with when we try to educate people, whether it’s an industry seminar, or whether we’re working directly with the client as we break down most of the different categories. Your basic services start with something such as wholesale space, or even what people might term as colocation services. As you start to move up a little bit, you add some additional managed services on top of that. You might move to the position of where you no longer want to own your assets, which is an outsourced solution, or even eventually, the most advanced or mature services today are moving into a cloud offering, and there’s different types of cloud offerings we can talk about as well.
Data Center Spotlight: Okay, great, well, let’s talk about the first one on your list there, and that is colocation. Colocation can be anything from a quarter cabinet to a 10 megawatt installation for the largest users. How do you define, and how do you view colocation in the market today?
Jeff Gilmer: Yeah, so colocation is really what we would determine one of the basic, and almost becoming a commodity type of data center service today, and you’re referencing a smaller client to a large client, size of client really doesn’t drive the difference in colocation. What colocation is, is as a client, you have certain responsibilities, and the vendor’s providing those responsibilities, and typically from a vendor perspective, it’s pretty basic data center services. They’re providing a facility, they probably have the power in place with emergency generators, they provide cooling, some sort of fire detection or suppression system, they may have a central network, core network that you share within the networking, or you may have to provide your own. They commonly are going to have your security, meaning more the physical security, they’re not going to take care of your firewalls or your internal digital type security, but they would take care of the physical security aspects of it, and in some cases, they may even provide cabinets and racks, but from the client perspective, the client still owns all the assets, so they’re purchasing their servers, and their storage, and their network connectivity, and probably even cabinets and racks with some of them. You still have to provide the resources to support all of your compute in there. You still have to get involved in things around backup and restoration and disaster recovery as well, so again, the vendor’s really providing the facility, and kind of your three capacity components, power, cooling, and space, and from the client perspective, you’re managing, operating, and running all of that equipment within that facility, just like it would be your own building.
Data Center Spotlight: All right, let’s talk about managed services, because I know managed services can also be a wide range of things, and it seems like companies start with colocation, and as you mentioned, it sort of reached the commodity stage, but then people realize that they need services that are closely aligned with colocation. What services are people trying to apply to their colocation? What’s the next level they’re trying to move to with their IT infrastructure by bundling on managed services to those colocation arrangements?
Jeff Gilmer: Yeah, so, again, people are starting with basic services, or they’re starting with basic services and they’re adding some sort of managed service on top of that, and of course, depending on what provider you talk to, they all offer different types of managed services, or to try to put a marketing spin on it, they may offer the same managed services, but they may define them in a different fashion. So, how we view managed services is, you think of it as you’re going to lunch. You open up that menu, and you’re going to order something to drink, you’re going to order maybe a salad to start, maybe an appetizer, maybe the meal, and what type of sides do you want with the meal, so for vegetables, or something else, and maybe desserts. You’ve got all these choices to make. Very similar as you start to look at the managed services from the data center perspective. You might have some of them being, they’re going to install your servers, or people call it racking and stacking of the server equipment, of your storage devices. It could be doing updates and patches on your compute devices, it could be troubleshooting. You could be having somebody doing some database administration for you as an example. They could be monitoring your network traffic, and your network capacity. They could be disposing of your compute equipment when you go through some sort of refresh.
Any one of those types of services, even down into service desk integration, maybe integrating some of the issues with the data center into your own service desk, and providing a portal for you as a client to access it and see what’s really happening to your equipment. These are all the different types of managed services. The key thing I think that people need to understand about managed services is, there are two ways that you can approach them. One, the partner may bundle some of these services together, or two, you can purchase them one at a time, purchase A, purchase B, purchase C, etc. The only caution that we provide to our clients is, when you start to purchase them one at a time, by the time you get up to two, three, four, or five services, you’re probably better off just purchasing one of the bundled packages from that particular provider, than you are to add them on individually, at least from a cost and efficiency perspective. So keep that in mind, as you start to really discuss and evaluate managed services with a provider.
Data Center Spotlight: Is the increasing level of security threats, is that driving growth and what’s being offered as far as security-oriented managed services goes?
Jeff Gilmer: I don’t know if it’s driving growth, and I’ll give you two different perspectives on that, or let me put it this way: it’s driving growth somewhere. Usually, that growth is within the client from a security perspective, not necessarily from the data center provider, and I think the reason that we’re seeing that is, security, again, trying to define security, is it a breadbox, or is it a boxcar, from a train? It’s all over the board of the size of what people really define and include in security. Now, one of the biggest issues you have is liability within a data center, right? So the big reason that people go with location is to allow or make a component of their services that the client is responsible for all the computing side, and the application side, and even in a managed services environment, they are still responsible for all their applications, it’s a liability. If that application goes down, and that business goes down, most data center providers aren’t going to want to take on the liability of their security breach, so they’re going to put that back on the client, and the reality is, if you’re doing any sort of compliancy review, whether it’s HIPAA, whether it’s PCI, whether it’s CJIS, any of those types of regulatory or compliancy reviews are as related as much to the data, and the application, as they are to the infrastructure, both from a data center, or a compute side, that are operating it. So, in summary, I think from the security side, while security is there, most of these providers are keeping that responsibility with the client, just from a general liability perspective.
Data Center Spotlight: That’s some good information, because I know you and your colleagues at Excipio are dealing with a lot of very large data center users, both in the private and the public sector, and it’s interesting to hear about how they view their responsibility with the security services. Let’s move on to what’s next on your list, and that’s outsource services. Is that kind of the traditional IBM or Unisys model of outsource services that we’re talking about there, Jeff?
Jeff Gilmer: Yeah, and obviously that drives us to manufacturing, as you mentioned, IBM and Unisys as most people know, are the big players in the mainframe environment, and there still are quite a few mainframe devices out there, and initially people did not want to fund a mainframe from that perspective, they didn’t want to own the asset. They didn’t necessarily want to be responsible for it, they were looking for some sort of shared environment with the potential resources to manage that mainframe, so they looked at outsourcing it, and that outsourcing, as the distributed environment grew out of the mainframe environment, with your midrange and your Wintel devices, they simply grew that outsourcing service’s capabilities. So, the key things to remember in an outsource scenario is, A, as a client, you no longer own the equipment, so all your assets, your storage equipment, your server equipment, your network equipment is now owned by the outsourcer. You probably do not own any of the resources that are managing that, they take care of all the resources. You may or may not own the software licensing, and that one is really kind of dependent upon the manufacturer and the type of software that you’re providing. And of course, then they’re providing all of the service desk coverage, and the support coverage, and the security, and the facility itself, and all the other aspects of it.
The one aspect that remains with the client, in typically a traditional outsource solution, is the application side. The client is still commonly responsible for those applications. Exceptions in how we look at it, or see it divided is, let’s say a traditional packaged application that you’re purchasing, let’s say it’s a Microsoft Office suite, or it’s a financial package that you’re purchasing and you’re not modifying. Those packages commonly can be supported by the outsourcer. If it’s custom development work that you’re putting into, you’re actually developing a solution specifically for your business, many times that would remain with your own people within the company to handle the application development, the application from a test down and a support side.
Data Center Spotlight: So that’s outsource services, and now that we’ve talked about colocation, about managed services, and gotten your perspective on outsource services, we’re onto the next item on your list of services that you offered at the beginning of the call, and that is cloud computing. It seems years into cloud computing, we still don’t have a true market definition of cloud. You hear different people talking about cloud as different things. How do you and your colleagues at Excipio go about defining the cloud environment, Jeff?
Jeff Gilmer: Yeah, it’s very confusing out there, and actually, let me take that point and just expand on it. I’m just trying to throw out all the different components of cloud you hear today, and then I’m going to bring that back and talk about how traditionally you can really simplify that down to what is a cloud solution. So within cloud today, you have different things, take infrastructure as a service. Well, infrastructure as a service is a type of service that now is being provided as a cloud solution, but infrastructure as a service could include your server, your server sessions, your virtualization standpoint, or it could include the storage, or it could include network, or it could include two of the three, or it could include all three, and then you can purchase that type of cloud service as either a public cloud, a private cloud, or a hybrid cloud. So you have this complexity that grows upon that, and that’s just one type of cloud service, of infrastructure as a service. So it does get very confusing.
So let’s just step back and think about where this has come from, and where we are today. If you go to the traditional IT structure that people will remember, not too many years ago, you have your applications that you have running. You have the operating system that you’re going to run it on. You have some sort of mainframe server device that it’s stored on, and functioning through from a processing standpoint. You have your data, meaning, in some sort of storage, both in production, typically, and hopefully in some sort of disaster recovery mode within the storage. You have your network with your wide area network, your local area network, your core network, you might have voice over IP or telecom in there, you might have wireless in there today, but you have all your networking devices within the data center, and then you actually have the facility itself that houses everything. So that was your traditional structure, you have these five, six, seven different areas, or silos, that everybody managed. What happened, then, as we started to move to packaging those together. So let’s start with infrastructure as a service, probably one of the most basic, simple ways to put it together. Infrastructure as a service is combining that compute environment, so your servers, your storage, and your network along with your data center facilities, and now rather than maintaining each of those different silos of server, storage, network, and facilities, you’re simply purchasing that as a service, and on top of that service, you can then include the installation of the operating system, or select your operating system, which now all of a sudden, that became platform as a service, and then you go to the next level, which is now I want to select the software I want to run on top of that, or my applications, and now we have software as a service. So from a traditional to a service sourcing type of structure, we went to infrastructure as a service, all the compute, power, and facilities. Then, we went to platform as a service, now adding our operating systems, and then we moved to software as a service, where we’re now adding on the application.
Now, what is cloud computing? Cloud computing is essentially combining or taking those services and they’re being provisioned over the Internet, so that they can be accessed anywhere, at any time, and we’re moving to a transaction type of basis, where you’re purchasing it based on how much you consume, and you also move to kind of what the old term used to be called, the utility computing model, where you can turn it off, or you can turn it on. You can increase capacity, you can decrease capacity. So in its simplest form, cloud computing is purchasing basically your data center services, computing services that are provided over the Internet on an as-needed type of basis.
Data Center Spotlight: Jeff, you’re talking about turning up and turning down capacity, and having various levels of capacity that you might need throughout the course of the year. Can you give us an example of a company that really benefits from the cloud and the flexibility it provides?
Jeff Gilmer: Yeah, so, I mean cloud computing fits a lot of areas, and honestly, it doesn’t fit a lot of areas, that’s kind of the biggest misnomer. You can’t move everything to the cloud, but I’ll give you one example of a company that we worked with recently. This company is actually the financial transaction company for both corporations and the educational system. So what they do is, let’s say you have a large corporate campus, and you have a lunch service at that corporate campus, a meal service, and you can purchase X amount of money on that meal service, for that corporate campus. Well, that corporate campus is open year round. On the opposite side of that, you have the educational system. You have your schools, K-12. Well, they function commonly nine months out of the year, and they also provide a service, from the corporate, they then developed a module that would work for the school systems where they could have a meal plan. So the parents now can go online, mobile with their phone, whenever needed, and put money into their child’s account, so that they can purchase their school lunches.
Well, what they found is, there was significant demand, especially at the beginning of the school year, August-September, and then it would taper off, and they’d have even demand through the year, and then they’d have another large amount maybe after the holidays, at the start of the next semester. But when it came to the May timeframe, all of a sudden, from May through early August, that demand dropped to almost nothing, to zero. So, they were paying for data center services, in a managed colocation solution with all their computing power, for 12 months of the year when they only needed it for 9 months of the year. So they were literally able to move to a cloud solution, turn off those transactions in May of each year, bring those transactions back up in August of each year, and pay 75% of the cost that they were paying previously because they’re really running at 75% of the year from a timeframe perspective.
Data Center Spotlight: So, for a company like that, the benefit of the cloud largely has to do with the flexibility and then the scalability, they can scale up when the need is greatest, and they can scale down when it’s not nearly as much.
Jeff Gilmer: Exactly, and it’s not just that type of company. Any company that runs shifts, instead of licensing individual, and instead of running compute power, should really consider this, so things such as a manufacturing firm, something such as a healthcare organization that’s open 7/24/365. Some of your public sector, public safety clients within the public sector. There’s a lot of different organizations, that if they’re running 7/24/365, hotels, and the hotel industry, is an example. They can all look at how they can use the flexibility of cloud, for both the licensing and transaction basis to ramp up or ramp down based on shifts, based on time periods, other factors that come into play.
Data Center Spotlight: Jeff, when it comes to all these different levels of services that we’ve discussed today, you have a very defined process at Excipio that you help organizations figure out what their actual data center and IT infrastructure needs are. Can you tell us a little bit about that, and a little bit more about Excipio for people who might be interested in engaging with you on that?
Jeff Gilmer: Yeah, certainly, so there’s a couple aspects to it. The first thing I’m going to bring up is the Critical Facility Summit that happens every year in Charlotte, NC. It’s coming up October 2nd to the 5th, I believe, this year, 2016, and I’m actually doing about a two hour workshop on what we talked about here today in great deal, and including things such as financials and risk assessment, and some of the key characteristics, and what, as a company, should I really be looking at when I start to look through these providers? What are the questions I should be asking, and that seminar, by the way, or that workshop is included in the attendance, your attendance at the Critical Facility Summit. So if you’re attending, I’d encourage you, if this is an area of interest, to attend that workshop.
The other place, that you can find information, of course, is our website, excipio.net. We have significant information on there, we talked about our data center life cycle management practice, and our methodology that’s been put in place for almost two decades now. We have some significant data from data centers, in that we’ve assessed hundreds of data centers on an annual basis. It allows us to provide benchmarking and comparative analysis, and other things as well, so all that type of information, some of it is available on the website, other is available through inquiries, but we help a lot of organizations really understand real world, what are the risks of these types of providers, what are the risks with our company, what is the best fit for us, both the short term and the long term, and especially, what are truly going to be my cost factors to consider if I go into this type of environment?
Data Center Spotlight: Well, terrific, and the website for them, if they’re not attending the Critical Facilities Summit, the website for them is…..?
Jeff Gilmer: Again, it’s excipio.net.
Data Center Spotlight: Okay, terrific. Jeff, thanks for joining us today, I look forward to another conversation soon on IT infrastructure, data center, and cloud topics. I appreciate your time today.
Jeff Gilmer: It’s always great to speak with you Kevin, thanks again.
Data Center Spotlight: Thanks, Jeff.