Building a Data Center TCO Model | Cyxtera

Cyxtera Technologies • October 03, 2017 • 2 minute read

Colocation in Data Centers

Enterprises with on-premises data centers are constantly juggling the capital and operational expense decisions that come with owning and operating their own data centers. These decisions typically become more difficult when either the data center is no longer enough for the business, the infrastructure has to be replaced, or the business is looking for greater efficiency and bandwidth that it can’t get on their own. As a result, many enterprises move to a hybrid IT infrastructure model, leveraging off-premises data centers in some shape or form.

At this time, a choice has to be made about which implementation and/or transition strategy to utilize. Some businesses choose a cap-and-grow model in which they cap investments in their legacy facility and keep it in production with the current assets. As they grow and invest in new infrastructure, they move them to a cloud or colocation data center. In full data center migration, an enterprise’s IT infrastructure, applications and other assets are moved to another operating environment. This is a complex process and, if not planned and executed carefully, could result in significant disruption. Other businesses go workload by workload, analyzing the portfolio of systems and applications to identify the optimal deployment model for each, be it public cloud, colocation or something else.

Whatever model is chosen, enterprises should consider key costs involved with building, operating and maintaining a data center. These include but are not limited to: real estate and facility costs, critical infrastructure costs, staffing costs, opportunity costs and additional operating costs. Businesses also need to understand the total cost of ownership (TCO) of their data center ecosystem and what it means for their go-forward strategy.

Enterprises should perform a TCO analysis on a regular basis and involve multiple stakeholders. They should avoid cutting corners on things like rigorous commissioning or reacting based on what other companies are doing. They need to make sure they’ve captured all applicable costs and look for efficiency opportunities throughout the process.

Cyxtera recently hosted a webinar, “Building a Data Center TCO Model,” featuring Scott MacIntire, Uptime Institute’s director of client engagement. The first of our new series of monthly webinars designed to further educate people on the multiple benefits of colocation, it focused on factors including data center migration, real estate, workload capability, operating costs and others. Participants asked questions about who should be involved in building a TCO model, when the TCO modeling process should begin, how to factor a service provider’s quality into the equation and much more.

If you missed the webinar, you may replay it in its entirety. Please also join us for upcoming Inside Colocation webinars that include:

  • Demystifying Data Center Tier Ratings – October 11, 2:00-3:00 pm ET; presented by Keith Klesner, Senior Vice President of North America at Uptime Institute.
  • A Major Factor in Data Center Selection: Location, Location, Location – November 14, 2017; 1:00pm – 2:00pm; hosted by Shawn Novak, VP Data Center Solutions, CBRE.
  • Reduce Your Disaster Recovery (DR) Risk with Data Center Colocation – Mid-December, 2017; hosted by Nader Hantour, Lead Solution Engineer at Cyxtera.

Registration for the October 11 webinar is now open. For more information about our data centers and colocation, please visit

Views and opinions expressed in our blog posts are those of the employees who made them and do not necessarily reflect the views of the Company. A reader should not unduly rely on any statements made therein.