On-premise vs cloud? How a prefabricated modular data center can solve the debate

This audio was created using Microsoft Azure Speech Services

In the discussion about data center planning in deploying workloads on-premise versus the cloud, there comes a time when a third option emerges as an optimal choice – prefabricated modular data centers. The modular data center compresses the time invested in planning and building a data center from scratch, quickening time to market for new services.

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The modular option is the focus of this third part in a series of conversations between myself, Thomas Humphrey, North American Business Development Manager for Schneider Electric Modular Data Centers; and Todd Boucher, Founder of Leading Edge Design Group

Joe: How do you see modular data centers playing into the discussion of on-premise vs. cloud?

Thomas: In complex hybrid environments, customers have some combination of cloud, data centers, and edge computing sites. In these distributed environments, a modular option simplifies the process of building a non-traditional data center environment and mitigates risk. From a site development standpoint, you’re dropping a module with a complete data center on a pad. If construction is delayed a couple of days, there isn’t that compounding effect in the construction cycle where everything else gets pushed out. The true value proposition of a modular approach is speedy time to market to produce revenue quickly and lower costs.

Todd: A few factors that have changed in recent years have made modular an important part of the conversation. The first is that today’s data center conversation is not a binary choice between one thing or another. It’s multi-dimensional and involves multiple solutions in both cloud and on-premise. The second factor is the democratization of fiber. There’s been significant investment in making fiberoptic connectivity available outside of the traditional Tier 1 data center market. So, that dynamic has enabled modular data centers to provide value.

Joe: How has modular changed the definition of “data center?”

Todd: For customers, it’s become about how to best deliver services to users. Modular becomes a great option with the right real estate availability, team, and conditions. It’s a great – often cost-effective – solution that helps deliver services quickly and reliably. That is attractive to customers, and it’s why it has gained a lot of popularity.

Thomas: The maturity of the modular market has grown by leaps and bounds from 10 years ago. This goes back to the customer understanding their own capabilities and desire to manage a data center construction project. A small regional bank or hospital might have a great IT staff, but how many data centers do they build in their career? Maybe one, maybe none. Alternatively, they can go to Schneider Electric or another vendor that provides modular data centers and has built thousands of them. And they can get the same designs that can be reused in many applications. So, there’s shared learning in building modular data centers. Every time we have a tweak from customer input, we’re engineering that into our designs, creating designs that have been tested and confirmed to perform better.

Joe: Let’s talk about speed to market. When a client concludes they need a data center fast, how do you decide if it should be modular?

Todd: A customer undertaking this process the right way asks, “What do I need?” Then, they have to consider the budget approval process to determine if they can start six months from now or in the next fiscal year. As soon as that funding becomes available, they have a window to spend that money based on when the capital is allocated. So, speed to market definitely matters, and for customers that evaluate their needs the right way, this is a critical part of that conversation – thinking about what their utilization of capital is, and how it aligns to what’s available in the options open to them.

Joe: So, it’s not just about speed to market, from what you’re saying. There’s also a predictability component.

Todd: Yes, predictability matters. Forecasting should be part of any planning process, from the initial planning stage all the way through commissioning. And this should be a consistent process. Modular tends to be more predictable because there are fewer on-site construction factors to consider. 

Thomas: With traditional construction, you typically hire an architect and engineering firm to design the space. Then, you put the project out to three bids, which takes time. Then, the general contractor has a submittal process, so there are all these benchmarks that go into ultimately starting the construction. Whereas with modular data centers, we compressed it all to before you cut your purchase order. You have to make all those decisions ahead of time, resulting in a shorter construction cycle. A modular data center option is a practical choice to scale out data center capacity with its speed of deployment, standardization, and ease of planning.

Joe: How do modular data centers contribute to sustainability strategies?

Thomas: Sustainability is another key advantage of a modular data center. For instance, modular structures can be built with more sustainable materials such as recycled steel and helical piers vs. permanent structures made of concrete, which is energy-intensive.

Todd: A traditional data center design involves a bunch of disparate components. You have to engineer the detailed monitoring systems into that design for the customer to extract and incorporate data out of those systems into their ESG and sustainability reporting. Whereas a benefit of modular is that those systems are integrated together, they talk to each other, and the data is readily available. For customers prioritizing sustainability, that element of data reporting and manageability can be of great value.

To wrap up our series covering on-premise vs cloud deployments, one key takeaway is clear — data center planning is not a one-size-fits-all endeavor. Data center stakeholders need to be thoughtful in their approach and evaluate all of their options. Specific business needs should drive the selection of the solution, complemented by a holistic conversation that defines what directly and indirectly affects your business. The good news is there are multiple approaches for a growing hybrid IT environment. While the cloud remains a viable option for many applications, modular data centers are also a practical choice to quickly scale and meet the increasing needs of data centers today and tomorrow.

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