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Cloud vs. Colocation

cloud computingThe conventional wisdom says that utilizing the cloud is almost always a more cost-effective solution than the alternatives. However, there may be some instances in which colocation may actually cost you less than cloud solutions.

How is this possible? Well, according to a study by the Google Senior Manager of Production Network Engineering and Architecture, Vijay Gill, if you have an environment that uses highly-utilized servers, colocation may actually make more sense.

While there have been a number of critiques of Gill’s work, the fact of the matter is that he makes a convincing argument. The example he used was of a high-utilization environment that would cost approximated $120,000 using Amazon Web Services and only around $70,000 using colocation.

The analogy that Gill uses is that of travel. If you travel between two cities, such as Detroit and Chicago, it might make sense to ride the bus if you only go once a quarter. If you make the trip three or four times each week, you can see where it would become less expensive to buy a car for your travel.

If you’re running your server infrastructure at 100 percent utilization, it only makes sense that the cloud can’t really offer you anything in the way of improved duty cycles. It makes sense to provide an in-house based colocation solution.

For a company like Google, getting 100 percent utilization might be a reasonable focus. After all, you’re talking about serious amounts of resource needs, from server resources to storage to I/O. A company of that size has much more flexibility when it comes to getting peak efficiency out of their hardware.

For companies that don’t get as much in terms of mileage or utilization from their servers, however, the cloud is probably still a better option. The colocation math doesn’t scale down to companies that don’t have the internal resources to make 100 percent utilization a company priority. Companies that have lower utilization will almost always be better off with the cloud.

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Unitiv, Inc., is a professional provider of enterprise IT solutions. Unitiv delivers its services from its headquarters in Alpharetta, Georgia, USA, and its regional office in Iselin, New Jersey, USA. Unitiv provides a strategic approach to its service delivery, focusing on three core components: People, Products, and Processes. The People to advise and support customers. The Products to design and build solutions. The Processes to govern and manage post-implementation operations.