Sustainable future: a world without private datacentres?

July 7, 2022 Mark Turner

The suitability of private datacentres for companies everywhere - both in terms of environmental and financial sustainability - is a question that’s growing in importance. Many organisations are concluding that they would be better able to deliver on their green targets, save money, and create a fit-for-purpose IT estate by winding down their private datacentres and moving to public cloud solutions.

In this article, we’ll look at the current state of private datacentre sustainability, and then explore why public clouds are becoming increasingly attractive to enterprises everywhere.

Private datacentres - unsustainable and expensive

There is no getting away from the fact that the environmental cost of datacentres is considerable. As reported in Computer Weekly, it has been estimated that 20% of all the power generated in the UK in the next few years will be used to power datacentres, but that only 21% of the power datacentres use is generated from renewable sources. This level of power consumption paints a bleak picture for any organisation attempting to reduce their carbon footprint. And if your organisation is committed to refreshing technology to ensure the best performance, then the cost of junking old technology needs to be considered - though if you don’t refresh your technology, the decrease in power efficiency will also add to your carbon footprint.

It is also worth noting that, according to Business Leader, 75% of customers choose to work with organisations because of their sustainability credentials; Microsoft tells us that 98% of investors use sustainability credentials to evaluate non-financial performance. Quite apart from the valid and pressing environmental reasons to go green, sustainability can have a positive business impact: 75% of all UK businesses reported commercial benefits after improving their sustainability efforts.

Thinking of financial sustainability, average running costs for a large datacentre vary from $10 million to $25 million per year. Some of that is in hardware and real estate that depreciate with time, but as much as 80% of that cost is in power generation - and power is getting more expensive. In September 2021, Data Center Dynamics reports, power prices had jumped from £50/MWH to £2500/MWH over the previous six months, and the trend looks set to continue. As we’ll see below, the savings that public datacentres can offer make it difficult to justify the expense of a private datacentre.

In short: as companies look to get leaner and greener in 2022, private datacentres tick neither box. Sandy Simcox, Head of Cloud Portfolio Management at Claranet, observes:

"We're seeing huge demand for services such as FinOps and GreenOps, which allow customers to understand, manage, and track their costs and carbon output. Organisations are looking for business cases for new technologies that show strong cost management, accurate cost forecasts, and how they'll contribute to their organisation's sustainability targets."

Public datacentres offer a way forward

Public datacentres such as the Azure public cloud offer an exciting alternative for organisations ready to move away from private datacentres. Their operating model allows public cloud providers to achieve greater cost savings and carbon reductions through economies of scale in power generation, cooling, physical security, and more, that private companies would struggle to manage on their own. And because running the datacentre is their sole focus, public cloud providers are better able to refresh their hardware to keep operating at maximum power - and environmental - efficiency.

Public datacentres are also investing heavily in renewable energy. Microsoft, for example, has committed to purchasing 100% of its electricity from renewable sources by 2030.

These factors mean a number of things for organisations that switch to the public cloud:

  • Datacentre operating costs are reduced (by around 80% for Azure customers).

  • Your datacentre switches from a Capex cost to an Opex cost that’s more flexible (and almost certainly lower).

  • Your business benefits from the datacentre provider’s sustainability efforts, such as Microsoft’s 100/100/0 commitment.

As Musidora Jorgensen, Chief Sustainability Officer at Microsoft UK puts it, “We are on the path to reducing and removing Microsoft’s carbon footprint, and this environmental commitment extends into our cloud operations. Microsoft’s investments in carbon neutrality and renewable energy, in addition to design decisions and benefits of scale, provide up to 93% greater energy efficiency and up to 98% greater carbon efficiency than traditional enterprise datacentres. As we continue to invest in greater amounts of renewable energy and carbon reduction and removal, we expect those benefits to grow even larger.”

Because a public cloud provider often gives you access to newer and better technologies than you might have in a private datacentre, moving to a public cloud such as Microsoft Azure also helps you achieve business modernisation faster. Innovations such as serverless implementations, container-based computing, and elastic architecture all help to further reduce your technology footprint and use of resources, and make your organisation better able to meet the needs of customers and employees.

The journey to the cloud: challenges, and a possible solution

The shift to the public cloud is already happening. According to Gartner, 10% of organisations have already shut down their datacentres; by 2025, they predict that 80% of organisations will have done so.

With energy costs rising rapidly, every day you delay this decision could be costing your organisation. The first step is to thoroughly analyse your current environment, understanding where you are now, what infrastructure you want to move, and what your requirements might be. That in itself may feel like a mammoth task, and - if done traditionally - can take months, especially for global organisations with multiple users and applications, or large volumes of data.

One solution to the challenge is to look at a non-traditional migration path, such as the Microsoft Azure VMWare Solution, or AVS. AVS is a stepping stone to a full cloud migration that lifts and shifts your infrastructure, as-is, into the Azure public cloud. Your organisation’s apps and systems will continue to work in exactly the same way, and - if handled correctly - AVS can be done with zero downtime, avoiding the risks and costs associated with that. Once your organisation is migrated using AVS, you can establish a roadmap and timeline for full cloudification, knowing that your organisation is already taking action to become more environmentally and financially sustainable.

A case study of AVS

In this article, we’ve made the case that migrating away from private datacentres and embracing the public cloud can help make an organisation far more sustainable and reduce costs. AVS has the potential to make the migration far less painful, and far quicker, than a traditional migration could be, helping organisations avoid the looming energy cost crisis and giving them a solid foundation for building a cloud-native IT estate that delivers the full potential of cloud computing. But, as with most things in IT, talk is cheap - unless it can be backed up by results.

Kier Construction group recently used AVS to migrate to Azure Public Cloud, with support from Claranet. The full case study can be read at the link below, but key headlines to note are that, in just three months, they:

  • Successfully moved 640 of their 1,400 virtual servers to the cloud.

  • Decommissioned a further 600 servers, vastly reducing their IT footprint.

  • Migrated 135 of 262 applications to the cloud.

Mark Turner, Cloud Business Director for Claranet, adds:

“The IT team at Kier have an exciting time ahead as they move to a cloud-native architecture that ultimately makes the business more competitive, agile, and carbon neutral. We were proud to help Kier decommission its first two datacentres, and to continue supporting the business with embedded FinOps to ensure its Azure cloud estate is as lean as possible.”

With more and more organisations facing the realities of rising energy costs, mounting pressure to go green, and the need to make their infrastructure fit for the modern age, public cloud is now the clear future.

The public cloud’s scope for next-generation computing, its relative sustainability compared to private datacentres, and its flexible cost structure all make it a strong contender for the future of enterprise network infrastructure. And, as long as organisations can navigate the complexities of the migration with the support of tools like AVS, these benefits could be delivered at record speed.

Mark Turner

Mark Turner
CLOUD DIRECTOR
Claranet

Claranet builds a fast and secure new future for Kier with Azure VMware Solution - Find out more

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