Data center trends for

2016 and beyond

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 02
Data center trends
for 2016 and beyond

Introduction

I
ts an exciting time for the data center market in Asia.
Traditional enterprise IT is not built to compete in the
interconnected era, and a recent Enterprise of the Future
survey of 1,000 global IT decision-makers by Equinix reveals
that businesses worldwide are taking action by moving
quickly to become interconnected enterprises.
In mid-2015, Synergy Research estimated that 5% of all global
data centers are in Singapore, 10% in China, 5% in Australia,
and 5% in Japan. Malaysia also aims to become a data center
hub in the near future, while Hong Kong is seeing a surge of
companies pursuing interconnection, with 76% of its businesses
intending to be interconnected by 2017.
This regional growth is in accord with many cities in the region
aspiring to be smart cities and enterprise looking to digital
disruptions as the key to Industry 4.0, which is centered on
the Internet of Things (IoT).
We can expect major transformations ahead for data centers to
help unlock value and innovation in the digital and interconnected
economy. A smart city can only be built on smart infrastructure
- and data centers have been singled out by economies at the
forefront of this development as being the core infrastructure
on which the digital economy runs.

In the vast China market, 80% of Chinese companies are

creating new channels or strategies related to customer,
partner and employee engagement, such as digital, social and
mobile channels.

The top 10 trends impacting data centers in 2016 and beyond
culled from NetworkWorld Asias interactions with vendors,
enterprise users and research analysts in the region are:
1. The changing role of CIOs and IT departments
One key aspect of the changing role of IT is that the CIO and
his team can no longer afford to be a cost center and have
to become proactive in sourcing and provisioning IT for lines
of business and across functions in the organization. Issues
to be addressed include: policies for enterprise mobility,
BYOD and shadow IT; provisioning data center resources in
real time to meet the changing needs of an agile enterprise;
and becoming an internal IT service and solution provider
that also helps to drive business transformation in the
digital economy.
2. Higher power and cooling demands
As data centers plan their next technology refresh cycle,
many are considering by choice or through regulatory
mandate greener technologies. Running cost is also a
critical factor, considering that more power and cooling would
be required as enterprise demand for network bandwidth,
server performance and data storage management grows
exponentially. Power grid availability would also be a
deciding factor in the geographical location of data centers.
3. Availability in an always on world
The global marketplace and digital transformation dictate
that businesses operate 24x7. This also means that data
center uptime has to keep up, and resources have to be highly
available, with planned or unplanned downtime an absolute
no-no. The impact on backup and disaster recovery is
humongous, and new strategies and technologies have to
be employed.
4. Enterprise agendas driving interconnection
Interconnection is a direct and secure, physical or virtual
connection between an enterprise and its partners,
customers and employees. It fuels the interconnected
enterprise, enabling it to connect end-users to what they
need, when they need it, on any device, wherever they are.
5. Hybrid IT: marrying legacy infrastructure with the cloud
transformation
No enterprise would quickly write off its investments in
legacy systems, despite the push to go on the cloud. The
ability to manage hybrid IT effectively providing visibility
and control for IT departments while offering a seamless
user experience would be critical.
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Data center trends
for 2016 and beyond
6. Security in the era of cloud, mobility, social media
Simplifying the user experience actually requires
more complexity in the backend for data center and IT
professionals. Defending the network perimeter (which now
extends to every end-point), protecting users (wherever
they may be) and securing corporate information (think big
data) have become humongous tasks that keep them busy
in the day and awake at night!
7. Compliance in the digital economy
Besides security, regulatory compliance and corporate
governance require enterprises to ensure data privacy,
fiduciary transparency and financial accountability. The
digital transformation increases the amount of digital
assets and data, as well as the need for better governance,
compliance and risk management.
8. Flexibility in the age of big data and analytics
Big data and real-time analytics demand that the data
center infrastructure is able to provide a stable always-
on platform to process, store, analyse and deliver the
right information to the right people at the right time, for
the right purpose. Smaller, localized data centers may be
more effective in this respect, and geography becomes an
important factor especially with data sovereignty issues
being a key consideration.
9. DCIM: more automation, visibility and intelligence
The complexity inherent in the data center infrastructure
in the age of interconnection, digital transformation, hybrid
IT, social media, IoT, big data and analytics require more
automation, visibility and intelligence for more effective
management, testing, trouble-shooting and diagnostics of
data center resources.
10. Standardization in the age of IoT
For machines and smart cities to be truly interconnected,
open standards would be necessary. For the potential of IoT
to be truly realized, data centers would have to employ the
same standards; otherwise, the data center would become
an obstacle to interconnection.
The sections that follow substantiate some of these trends.
 04
Data center trends
for 2016 and beyond

Data centers of today

and tomorrow

T
he role of the data center today is to ensure that the
right data from the right applications are made available
to the right people in the form of the right information
and be used for the right purpose. This means that
data centers have become strategic assets but IT is
still widely considered a cost center, and IT departments are
often challenged to link their contributions to business leaders
perception of benefit.

Some experts estimate that data center operations account

for approximately 25% of an average enterprise IT operational
budget. In 2015, flexibility was a key driver as enterprises
sought better ways of delivering applications and data, meeting
business demands and enabling employees to work however,
and wherever, they want. IT departments have been trying to
find alternatives to costly and inflexible data center designs
to take advantage of emerging technologies or changes in
technologies.

As such, it was a year of transition in which many organizations
began to shake off the shackles of legacy architectures in
the pursuit of cost-savings, operational efficiencies and, most
importantly, gaining a competitive advantage.
Many businesses, up to 70% according to Gartner, turned to
cloud and transformed their operations into hybrid enterprises.
In the midst of this shake-up in legacy IT, the data center has
been the first piece of the puzzle to be overhauled. According
to Gartner, the future of the data center is also set to be
software-defined, and will be crucial to the long-term evolution
for businesses. In 2016, organizations will start to shift their
focus to their remote sites.
As an enterprises topology extends beyond the traditional
realm of on-premise data centers, network complexity increases
exponentially.
Being strategic assets, data centers have to cope with
technology trends today, in order to be ready for tomorrow.
These trends include the Internet of Things (IoT) and big data.
Add to this mix the continuing, ever-advancing march of mobile
devices in the hands of employees, and gaining control of the
network and applications is becoming the number one priority.
As network complexity snowballs in 2016, the role of IT has
also evolved and shadow IT applications will also continue
to infiltrate companies while employees may believe that
these apps will enable productivity, each new app adds more
complexity to the network.
It is clear that the industry is in process of disruption. Which
only means one thing data centers have to be automated,
smart, intelligent and ready for the future.

IDC has made the following predictions for data centers in the
next three years:
The future data center will continue to be hybrid not just part
of a hybrid cloud. While many companies have been journeying
to the hybrid cloud the past three to four years, the next three
to four years are about moving to a hybrid IT world, according
to Richard Villars, vice president of data center and cloud at
IDC, and one of the authors of the Worldwide Data Center 2016
Predictions report.
Coordinating a vast landscape of people and infrastructure
will soon be a regular part of the data center managers job,
one of the many changes predicted by IDC in its FutureScape
look at data center industry trends for 2016 and beyond. The
hybrid IT world will involve managing of various environments
in various locations, often run by a combination of staff and
outsourced workers, Villars said, and managing diverse assets
in an enterprises own data center, as well as up to 65% of IT
assets located at third-party data centers.
As more companies rely on service providers for staffing, data
center managers will increasingly face the job of managing the
movement and security of data whether it is on- or off-premise.
Planning the location of data center resources will also become
a critical requirement. Geography matters more than ever,
said Villars. The location of customers, business activity and
plans to expand to new geography will increasingly influence
data center decisions.
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Data center trends
for 2016 and beyond
Youll have to continue to refine your data center selection,
governance and performances processes, he said.
Another trend highlighted by Villars is agility, which for the data
center will mean being able to move assets and data into new
facilities quickly, and also getting the financing in place.
Convergence and software-defined infrastructure are other data
center industry trends that will also become more critical, and
the move toward it must be accelerated. New hyper-converged
offerings in 2016 and 2017 will include solutions to drive data
center consolidation for the data center and its staff.
Hyper-converged and software-defined infrastructure will
accelerate the use of managed services for basic administration
and configuration, shifting staff time toward value-added
business services, as well as managing and processing the big
data created in the new interconnected environment.
Data center staff will also need to be more aggressive about
automating discovery, provisioning and location tasks, he said.
We need systems to be self-identifying and self-discovering.
 06
Data center trends
for 2016 and beyond

Five data center trends

T
he industry continues to advance at an 2. Architecture trumps technology
unprecedented pace, said Steve Hassell, While data center technology plays an important role in
president of data center solutions for Emerson ensuring efficiency and availability, data center operators are
Network Power. While many businesses remain focusing less on technology and more on the architectures
cautious about making significant changes to their in which those technologies are deployed. We are seeing
IT infrastructure due to economic uncertainty and the desire to more customers who in the past would have defaulted to a
extend the life of existing facilities, we are seeing innovation on traditional Tier 3 or Tier 4 power architecture coming to us
many fronts and the potential for major transformation in the and asking for help in defining the right architecture for their
industry has never been more real. environment, said Peter Panfil, vice president of global
power for Emerson Network Power. They have confidence
Below are five trends Hassell believes will be shaping the data in the technologythats become a given. What they are
center landscape in 2016 and beyond: looking for is a system architectureincreasingly a non-
standard architecturethat is tailored to their requirements
1. Cloud gets complicated for flexibility, availability and efficiency. They value expertise
Most organizations are now using cloud computing to and experience more than technology.
some degree. The evolution from SaaS to true hybrid
environments, in which cloud services are used to bring
greater agility to legacy facilities, continues to advance as
more organizations move to a bimodal architecture. Rather
than stabilizing, however, cloud could get more complex. The
latest server utilization research, conducted by Stanfords
Jonathan Koomey and Anthesis Groups Jon Taylor, found
that enterprise data center servers still only deliver, on
average, between five and 15 percent of their maximum
computing output over the course of a year. In addition,
30 percent of physical servers are comatose, meaning
they have not delivered computing services in six months
or more. The push to identify and remove comatose servers
will continue to build momentum and is an essential step
in managing energy consumption; however, the potential for
unused data center capacity to become part of a shared-
service, distributed cloud computing model will also be
explored, enabling enterprise data centers to sell their
excess capacity on the open market.

Wireless sensors, DCIM drive holistic cooling optimization

Growing complexity in todays data centers has increased the risk of combining power, cooling, racks, cabling and management
components to run an efficient facility due to the shortage of essential skills needed to design and integrate them.

To get around this, smart organizations have turned to tightly integrated, aisle-based physical infrastructure modules, or PODs,
along with non-containerized integrated infrastructure solutions to optimize the use of power, space and cooling capacity while
simplifying specification, design, validation, procurement and installation.

This approach also offers the opportunity to build data center capacity incrementally, instead of setting up 100% of the infrastructure
from the start.

This strategic move addresses data center operators major pain points, including the need to optimize power and increase cooling
capacity cost-effectively and to avoid capital expenditure on new equipment via better capacity management.
 07
Data center trends
for 2016 and beyond

3. Data centers find a common language
The Internet of Things (IoT) will not only impact future
data center architectures by increasing the volume of data
that must be processed, it will also change data center
managementand the latter sooner than the former.
Todays data centers include thousands of devices that
speak a host of languages, including IPMI, SNMP, and
Mod Bus. This creates gaps between systems that limit
efforts to manage holistically. That limit will cease to exist
as Redfish, an open systems specification for data center
and systems management developed by Emerson Network
Power, Intel, Dell and HP, gains traction. Redfish will create
interconnectivity across data center systems, enabling new
levels of visibility, control and automation. Its adoption will
also help establish best practices for effective use of IoT in
other applications.
4. Social responsibility makes its presence felt
The industry has been dealing with efficiency since at
least 2007, but the focus has largely been financial. Now,
with organizations like the Natural Resources Defense
Council raising awareness of data center energy use,
some businesses are shifting their focus from efficiency
to sustainability and viewing their data centers through
a social responsibility lens. Data center operations
including carbon footprint, alternative energy use and
equipment disposalare now being included in corporate
responsibility statements, creating greater pressure to
make advances in these areas. The impact of this trend
will not be limited to on-premise technology decisions. To
be meaningful, reporting must include the full data center
ecosystem, including colocation and cloud providers. As
this practice grows, sustainability will rise to the level of
availability and security as must-have attributes of a high-
performing data center.

Higher power density a key consideration for tomorrows data centers

In 2016, data centers will need to be more efficient and achieve higher density, according to John Schmidt, Data Center Solutions
Lead at CommScope.

From a service provider and colocation perspective, there will be a large growth in providing distributed computing, he said. A key
area of growth will be in point-of-presence (PoP) data centers, supporting content delivery networks for service providers as well as
promoting network virtualization and software-defined networks.

A combination of growth within PoP and colocation will increase the need for interconnecting or peering between service providers,
said Schmidt.

The higher the density, the better, according to US-based Forsythe Data Center Solutions.

IoT is taking off and data is ever-growing. Servers must be able to handle the increasing demand of power, cooling and network
bandwidth. Servers with higher densities allow enterprises to quickly scale their business.

Forsythe advises that, when analyzing a data centers capabilities, it is imperative to ensure it is able to handle various applications
of all densities, with clear plans for updating cooling design and location strategy to offer peace of mind.

In todays rapidly changing IT environment, its impossible to know what you will need a few years down the road. Select a colocation
provider who can evolve with you without requiring you to make significant changes to your contract, IT environment, data center
space, and building systems. The ability to grow your data center space without a lot of work is important, as it helps ensure your
IT environment can grow while still operating.

Also find out if the facility is designed for a higher-density environment or if they need to make special accommodations to support
a high-density equipment load.
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Data center trends
for 2016 and beyond

5. The neighborhood data center moves in As with every industry, disruptive forcessecurity, sustainability,
The growth in digital content consumption and data speed and costsare driving change in the way data centers
collection is challenging the centralized data center model. are architected, constructed and operated. This should continue
While large data centers will continue to provide the majority throughout 2016 as the ability to deliver applications and
of computing, they will increasingly be supported by edge content to users while collecting and analyzing data becomes
facilities, or neighborhood data centers, that provide low- more critical to business success, said Hassell.
latency content and applications to users or data processing
and logic for IoT networks. As these micro data centers,
operating as satellites to a central facility, proliferate on
corporate campuses and in high-density residential areas,
their success will depend on the use of standardized,
intelligent systems that can be remotely managed.

Security and compliance considerations

The move towards multi-tenanted and hosted data center facilities is creating a need for greater security. According to Forsythe Data
Center Solutions, while many IT conversations focus on cyber security, your data centers physical security is also critical. Authorized
personnel and vendors are often the source of security breaches.

Moving to a colocation data center with strong physical security not only prevents unauthorized access but also keeps your data in
compliance with your industrys regulations.

Many colocation data centers are beefing up their physical, building infrastructure and logical security. For example, they are adding
more cameras and physical security checkpoints. They are also redesigning their command centers looking at how the room
is set up, what tasks they can perform from it, who can access it and how easy it is to see into it. Built-in redundancy also has a
security benefit no downtime means no loss of business or your reputation.

A few years ago, it wasnt critical for your colocation provider to have Uptime Institute certification. With increased demands from
customers who are always on and want to do business with you 24/7, this certification matters.

Be wary of data centers that dont have the actual certification, advised Forsythe. Often data centers will claim they are designed
to the Uptime compliance standards without having the actual stamp of approval. Knowing that your data center meets the
requirements and is verified by the Uptime Institute will allay fears from senior leaders, the board and employees. It will also set
proper expectations to the business around availability, redundancy and uptime.

You may also want to consider other compliance requirements based on your industry such as Health Insurance Portability and
Accountability Act (HIPAA) and PCI Security Standards. Can your provider ensure that you comply with these regulations? Can your
colocation provider withstand an audit on your behalf? Do they use a change management tool to manage every facet of their
business operations?

When selecting a colocation provider, its vital to have an in-depth understanding of your compliance requirements and security risks.
Conduct a vulnerability assessment to identify your areas of weakness and ways you can address them. When you understand your
risks, you can make the best use out of your limited security budget.
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Data center trends
for 2016 and beyond

Why DC trends point to a future of

interconnections and ecosystems

F
aced with lingering global economic uncertainty this year,
increasing efficiency, optimizing resources and reducing
the cost of doing business will continue to be top priorities
as enterprises try to negate the effects of slowing growth.

Businesses will be looking at more automation or outsourcing

infrastructure to service providers that can run it more efficiently
for them, says Clement Goh, managing director of Equinix
South Asia. Many will be looking to optimize IT infrastructure,
which is now one of the core components of the business as
well as a significant cost of doing business.

For example, the prospect of a more cost- and latency-effective

way of connecting stakeholders has galvanized many large
enterprises in the region to consolidate widely distributed
network infrastructures into major hubs such as Singapore and
Hong Kong.

Enterprises are also adopting the cloud at a faster pace with

82% of enterprises reporting a multi-cloud strategy, according
to RightScales State of the Cloud Report 2015. By outsourcing
IT infrastructure to the cloud, organizations can reduce costs,
IT manpower and resources needed in-house, and the burden of
keeping up with higher technology refresh cycles.
Conversely, Goh notes that the digital economy is also driving
services-driven businesses to innovate and create new revenue
streams. With the Internet of Things and cloud services,
companies selling maintenance services for hardware, for
example, could gather and analyze information sent back from
sensors embedded on the hardware to initiate preemptive
maintenance or predict potential product failures.
Ready to roll
The implication is that enterprises should no longer view IT
as a cost center, but a revenue-generating center. You can
launch solutions or services which can generate revenue for the
company through the technology options that are within our data
center, Goh says. To consolidate your network, we provide the
carriers, or to implement cloud strategies, we have the cloud
service providers, and to launch online content services, we
provide the infrastructure for the distribution of content.
This reflects a key factor of Equinixs success its focus on
making it easy for its enterprise customers to do business
within an ecosystem of cloud providers, network providers and
content providers on its infrastructural platform. Speed to
market and lower latency when providing those services will
give them the competitive advantage, Goh adds.
Clement Goh, Managing Director of Equinix South Asia
Specifically, the interconnections within the ecosystem have
been a significant enabler of enterprise growth. Equinixs
Enterprise of the Future survey found that the number of
enterprises worldwide deploying interconnections will more
than double by 2017 to 84% with Asia Pacific mirroring this
accelerated growth more than other parts of the world. Indeed,
84% of Singapore companies intend to be interconnected by
2017, compared to 14% today. Those companies that have
deployed interconnections have realized at least $10 million in
value from both revenue opportunities and cost savings.
With more services being launched online, be it on the internet
or the private network, interconnections help both large and
small enterprises to not only share information but also reach
millions of customers around the world, Goh says.
Interconnections become even more critical in the context of the
Top 10 Data Center Trends, which highlights the many demands
of an always-on world placed on IT organizations. Equinix
ecosystems provide IT organizations the option to leverage
on the expertise of service providers to provide the proven
solutions and consume them as utility, Goh suggests. This
way, businesses will be equipped to focus on addressing their
business challenges and seizing opportunities as they emerge.