3 Reasons Why Legacy Telco Facilities Can Make Perfect Data Centers

This audio was created using Microsoft Azure Speech Services

The longest echo lasted 75 seconds and was recorded in Scotland in an empty oil tank measuring twice the length of a soccer field. The central office at your telecommunications company might not be that large, but after converting to the latest technologies and stripping out legacy equipment, it might feel pretty empty.

And you’re not alone. The telco industry has undergone a major evolution. The switch from copper to fiber has readied networks for speed and scale, and the physical switch has become a software switch, shrinking the footprint needed for equipment. What once may have taken up 1,000 square feet now sits on a mere 1×1 square foot.

In parallel, government deregulation is disrupting the market, spawning competition where there was none and narrowing profit margins. They are also reevaluating government subsidies that currently provide a guaranteed return on investment.

All told, telcos are reevaluating business models and looking for alternative and sustainable revenue streams. Fortunately, there is a simple answer: Add a data center to expand your non regulated revenue stream.


Triple Threat

There are three compelling reasons why telcos make perfect data centers:

  1. They are located at the edge.
  2. They have switched from analog to digital, with connectivity included.
  3. They have central offices with tons of free space.

Tilt your head a little, and you’ll see central offices are already a lot like data centers. They’re mission critical facilities with mission critical infrastructures, prime for adaptation to a new economy of digital capacity and availability. Being close to the user with the foundation in place to support the demand for more connectivity, capacity and speed translates into a tremendous business opportunity.


End Results and Where to Begin

Not every piece of the existing infrastructure in the central office will be robust enough, and other equipment will need to be added. Generally speaking there are five key elements needed to convert to a data center: space, power, cooling, racks and security.

You can adopt one of two business models when transforming your space into a new data center — either colocation, where customers rent rack space; or hosted services, which requires deployment of IT equipment as well.
Depending on the size your space can support, a colocation facility can pay back investment within three years. However, the ROI is significantly greater with a hosted services approach.

Want to get started converting your central office to a data center? Register to join our next webinar, Welcome to the Edge: Your Blueprint for Success, where JSA, my colleague Joe Reele, Vice President, Datacenter Solution Architects, and I walk through the steps to convert your central office to a data center.

You can also download the telco site assessment questionnaire to further determine suitability.

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  • We have this discussion internally. This is the first time I have seen a compelling argument for changing business model.

    • Chris.

      If you would like, I am available to discuss this further with your company. Or if you prefer, you can go to SchneiderEdge.com for more information.


      Mark Hurley

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