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Data Center Sourcing Process For Cost Savings
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Data Center Sourcing Process For Cost Savings

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If you have not received a cost reduction for your outsourced Data Center Colocation provider in the last 18 months you could be missing out on up to a 50% reduction. It is worth going through a......

If you have not received a cost reduction for your outsourced Data Center Colocation provider in the last 18 months you could be missing out on up to a 50% reduction. It is worth going through a formal RFQ process and evaluating options based on: Provider, Geography, Support Strategy, and configuration.

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  • 1. DATA CENTER COLOCATION SAVINGS OPPORTUNITYIf you are operating an outsourced Data Center site and have not renegotiatedyour contract in the last 18 Months you have an opportunity to save up to 50%Proposed Presentation Notes:Silicon Valley IT CIO ForumSpring 2013Santa Clara MarriottBill Kohnen
  • 2. Data Center Sourcing Strategies• Geography Drives Center Cost• Big variations prices fromcompanies perceived as high endand others with little real difference• Capacity of a given provider in alocation• Do you need physical presencenear data center?• Technology at a specific site• Required configuration • Who and where?• Savings 10%• Reduction of floorspace andoptimized powersavings of 30%• Potential Savingsof 50%• Potential savingsof 30% or moreProvider LocationSupportStrategyHardware andConfigurationBest Total Cost Solution ConsidersConclusion: Many companies cut outsource data center cost in half
  • 3. Region Cost per rackWashington DC 2700BangaloreNew YorkSan FranciscoSanta Clara 1400SeattleNew JerseyOaklandChicagoPhoenix 950VirginiaDallas 800Jacksonville 550Cost Per rack by regionBest Total ValueLocations
  • 4. Range of Prices Between Providers illustration$0$10,000$20,000$30,000$40,000$50,000$60,000Washington SeattleHighAverageLowest16 %16%53 %28%
  • 5. Make your current provider answer immediately• Options to reduceand improve yourcost andperformance• Does currentprovider havelimitations thatpreventoptimization?• Ability toCompete withlower costregions• Competitivenessrelative to otherproviders.• Past, Present, FutureProvider LocationSupportStrategyHardwareandConfigurationBest Total Cost Solution Considers
  • 6. You should review your Outsourced Data Center CostsData Center Cost often makes up largest portion of IT operations budget.Data Center space has become a commodity.If you have not changed providers recently big opportunity to save up to 50%.If you chose to switch it is common industry practice for your new provider to giveyou additional incentive to move.Even if you stay with your current provider going through a formal RFQ processwill allow you to negotiate a reduction.There are “free” services that offer to manage the rfq process for you. They getpaid a commission by the data center companies.The planning and cost to do a formal RFQ and make visits to potential newplaces are worth the effort and commissions will go to you as further savings.