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INFOTECH: Locally Versus Internationally Hosted Data Centres – Making An Informed Decision


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Hosted data centres have become an increasingly appealing option given the rapidly expanding volumes of data organisations are expected to store and process, as well as the cost associated with procuring, managing and maintaining physical infrastructure. Such cloud-based data centres offer a number of distinct advantages, however, organisations do need to bear the locations of these data centres in mind. Certain data cannot be stored outside of South Africa’s borders for legislative reasons, precluding the use of an international data centre in such instances. In addition, storing data internationally can increase bandwidth costs. Furthermore, other issues such as disclosure legislations may detract from the attractiveness of storing data in certain countries. The decision as to whether to host data locally or internationally requires organisations to carefully consider their business needs, the available toolsets and offerings, and any applicable laws and regulations says By AJ Hartenberg, Portfolio Manager: Data Centre Services at T-Systems in South Africa

When it comes to cloud, one of the most well understood benefits is the ability to consume previously capital-intensive solutions on a monthly service basis, dramatically reducing costs and the complexity associated with managing infrastructure. However, there are numerous other benefits to the hosted data centre model, including improved compliance and security. Hosting providers must benchmark against rigorous industry standards, which means that their customers benefit from best practice in multiple areas, including both physical and platform security across all layers of the data centre.

In addition, hosting providers are often far more power efficient than in-house data centres, with certain providers offering a Power Usage Effectiveness (PUE) rating as low as 1.2. This not only helps to improve an organisation’s green credentials, but as power usage is a shared service with the cost passed on to the consumer, can result in significant savings too. Furthermore, when making use of a hosted provider, organisations can access cloud services such as applications, platforms, software and more on top of infrastructure provision.

With significant benefit attached to the use of hosted data centre services and solutions, the question now is not typically whether to use such a service, but whether to use a local or internationally based provider. One of the challenges lies around the location of data, as in some industries legislation precludes certain information from being housed outside of the borders of the country.

However, where this legal requirement does not exist, the challenge is more of a mindset around the need for control. If the legal requirement for in-country data centre storage is not applicable, organisations should look toward finding a provider that offers the most secure platform for their needs. In addition, organisations should consider specific laws in particular countries, for example the Patriot Act in the United States permits the US government certain levels of access to all data stored in the country, which may make this an undesirable location for certain businesses.

Further to these factors, South African businesses should also consider the exchange rate in their decision. An internationally hosted service will be subject to fluctuations in currency, which means that costs may differ every month, making it difficult to ensure predictable spend. In addition, network bandwidth is an important consideration, as international bandwidth may prove significantly more expense than local bandwidth, and may be subject to delays should international links go down, particularly when large data volumes are being transferred.

When choosing a provider, the first and most important consideration is to decide which applications, toolsets and services are required, and whether or not these are available on a locally hosted basis. Based on this, organisations then need to consider the levels of security offered by the providers of the services they need, and then understand the costs and service levels on offer. From there, it is advisable to conduct a proof of concept with the provider, from which point an informed decision can be made regarding future services.

As hosted solutions are delivered as a service, the contract is essential, and ensuring certain aspects are in place will improve service. The cost of services is obviously an important consideration, but other areas also need to be taken into account. Organisations should examine the contract carefully to prevent vendor lock in – elements such as penalties and exit clauses should be understood as this will impact on how easy it would be to move from one provider to another. It is also essential to understand how scalability is affected, in terms of the cost of scaling up or down and how easy this is to achieve. Organisations should also ensure they understand how long data will be kept by a provider should they decide to terminate services, as this will affect ability to transition between service providers.

Hosted data centres, whether locally or internationally based, offer organisations significant advantages in terms of accessing services and infrastructure in a cost effective manner. However, determining which provider is best is a crucial decision. Organisations must firstly understand their needs, requirements and applicable legislation, and then find a service provider that can cater to these and will work with the organisation to develop a contract that is suitable to both parties. Enterprises will then be able to leverage all of the benefits of the cloud, with minimal pitfalls.

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