The Case for Moving Away from In-House Data Centers in Enterprise Environments

by | Colocation, Data Centers

In today’s fast-paced business environment, enterprises must adapt to the changing technological landscape in order to stay ahead of the competition. One key area of concern for many enterprises is their data center infrastructure. In the past, many organizations relied on in-house data centers to store and manage their critical data. However, with the rise of advanced infrastructure trends like cloud computing and data center colocation, traditional in-house data centers are becoming less and less relevant.

According to Gartner, by 2025, 70% of enterprises will have shut down their traditional data centers. This shift away from in-house data centers is being driven by a number of factors, including scalability, agility, and cost savings. In this article, we will explore why enterprises need to be weaned away from in-house data centers and adapt to outsourced data centers in order to stay competitive in the market.

Scalability and Business Agility

One of the key advantages of using outsourced data centers is scalability. With an outsourced data center, organizations can easily scale their IT infrastructure up or down as needed. This is particularly important for businesses that experience spikes in demand or have fluctuating workloads. By using an outsourced data center, organizations can quickly and easily provision new resources, such as servers and storage, to meet their changing needs.

In addition to scalability, outsourced data centers also offer better business agility. By leveraging the resources of a third-party provider, organizations can respond more quickly to changes in the market and rapidly innovate to stay ahead of the competition. This is because outsourced data centers are typically more flexible and nimble than in-house data centers, which can be slow and cumbersome to manage.

However, many CIOs are concerned about the security of their data when using third-party resources like data centers or public cloud services. While this is a valid concern, it is important to note that outsourced data centers are typically more secure than in-house data centers. This is because outsourced data centers are subject to strict security and compliance regulations, which are enforced by the provider.

To ensure that they are making the right choice when it comes to data center platforms, organizations can work with colocation consulting service providers. These providers can help organizations to evaluate their needs and choose the right data center platform to meet their business requirements.

Technological Innovation

Another advantage of using outsourced data centers is access to the latest technological innovations. Cloud-based applications and enterprise-level data center solutions are driven by powerful technologies with a strong global online community. The cloud ecosystem is growing rapidly, and major vendors like SAP, Oracle, Microsoft, and Salesforce are making significant contributions to its development.

This has enabled the cloud community to address various issues relating to outsourced data centers such as security and control issues, risks involved, performance, and user experience. As a result, organizations that use outsourced data centers can take advantage of the latest technological innovations, which can help them to stay ahead of the competition.

Cost Savings

One of the most compelling reasons for organizations to move away from in-house data centers is cost savings. Building and maintaining a data center can be incredibly expensive, requiring significant spending in terms of technology, tools, and other relevant resources. For mid-sized enterprises and small businesses with limited budget options, investing in cloud-based services can be highly beneficial.

By using third-party cloud services, hyper-scale data centers, or outsourced data centers, organizations can save on resource overheads and costs. This allows them to invest more of their budgets into other critical areas of business, such as endpoint and network security, governance tools, and so on.

Benefits of Outsourced Data Centers

There are many benefits of outsourced data centers that make them a better option for organizations compared to in-house data centers. Let’s take a closer look at some of these benefits:

1. Scalability and Business Agility

As mentioned earlier, scalability and business agility are critical factors for the success of any enterprise. Outsourced data centers allow organizations to scale their IT infrastructure according to their changing business needs. They also provide greater flexibility to enterprises in terms of application deployment, data management, and resource allocation.

2. Technological Innovation

Outsourced data centers are equipped with the latest technologies that are developed and maintained by experienced professionals. These data centers provide access to advanced infrastructure trends such as cloud computing, software-defined networking (SDN), and hyper-converged infrastructure (HCI). These technologies enable organizations to streamline their IT operations, reduce costs, and improve their overall efficiency.

3. Cost Savings

Another significant benefit of outsourced data centers is the cost savings they offer. By outsourcing their data center needs, organizations can save money on capital expenditure (CAPEX) and operating expenditure (OPEX). These savings can be invested in other critical areas of business such as network security, governance tools, and more.

4. Expert Support

Outsourced data centers provide access to expert support and technical assistance. These data centers are staffed with experienced professionals who can help organizations optimize their IT infrastructure and troubleshoot any issues that may arise. This level of support is often not available with in-house data centers.


In conclusion, traditional in-house data centers are becoming increasingly obsolete as organizations move towards outsourced data centers. Outsourced data centers provide scalability, business agility, technological innovation, cost savings, and expert support. By migrating to third-party resources such as outsourced data centers, organizations can improve their overall efficiency and competitiveness in the market.

To get the most out of outsourced data centers, organizations should consider hiring a colocation consulting service provider. These providers can help organizations assess their data center needs and select the right data center platform that meets their business requirements. As the trend towards outsourced data centers continues to grow, it is essential for CIOs to reassess their business and technology strategies and consider migrating from in-house data centers to outsourced data centers.