Wall Street & Technology is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Data Management

04:00 PM
Tony Bishop
Tony Bishop

Are Modular Data Centers the Answer To Better Efficiency?

As technology organizations look to transform the service delivery model to be more agile, on-demand and cost-effective, modular data centers may provide the means to get there.

Can modular data centers actually streamline data center operations, reduce complexity, maximize efficiency and decrease costs?

Financial firms face a crisis in complexity unlike any they have ever faced before. Myriad challenges -- ranging from de-leveraging, increased regulatory oversight, new competition and product commoditization -- are forcing firms to rethink almost every aspect of the business.

Banks now have to organize their business processes in a completely different manner. Today, the focus has clearly shifted to discovering how to transact business in the most efficient and effective means possible. And in order to become an efficient organization, firms need to improve how they leverage information and make better decisions, faster.

At the center of these changes is technology. Financial firms' enterprise IT organizations face a conundrum: how to help the business become more efficient and make better decisions, while facing budget cuts, skill set shortages and increasing demand from all lines of the enterprise. To do this, leading organizations are looking to transform the service delivery model to be more agile, on-demand and cost-effective. One of the biggest barriers to transforming the delivery model is the data center facility.

The good news is, there appears to be one trend that is starting to take shape that can help remove this barrier: a modular data center. The 451 Group, an industry analyst firm, describes the emerging modular data center technology trend in the report "Data Center 2.0 -- The Industrial Evolution." The research points to the maturity of modular data center technology and data center infrastructure management automation. Modular data centers have substantial economic, operational and time-to- market advantages over traditional data center facility approaches, according to 451 Group.

[7 Tips for Moving to a Global Shared Services IT Model]

Recent market announcements seem to validate the modular data center trend. For example, in a recent press release, Goldman Sachs announced the selection of IO, a provider of modular data center technology, as its preferred global modular data center provider.

The press release states that Goldman's selection signals a shift from the large real estate-based infrastructures to flexible and sustainable modular installations. In addition to greater operating and capital expense savings, Goldman Sachs expects to enhance energy conservation and power usage effectiveness (PUE) associated with its data center facilities through its service agreement with IO. "IO's innovative technology and services will allow Goldman Sachs to scale its data center operations more efficiently and further advance the firm's broader commitment to environmental stewardship and reduced carbon footprint," said Don Duet, global co-chief operating officer of Goldman Sachs' technology division, in the release.

As both a former user and operator of data centers, it excites me to see the integration of the data center via technology into the IT delivery model, as Goldman Sachs is doing with IO Data centers. This is a significant validation and likely indication that the velocity of modular data center technology is going to increase. This technology innovation should enable firms to transform their entire businesses, starting at the foundation of their IT value chain -- the data center. Any architect or engineer will tell you that successful systems require a simple and scalable foundation.

Modular data center technology appears to be one of the key mechanisms for IT organizations to leverage in order to transform their delivery models, improve efficiency, enhance agility and reduce risk. Modular data centers are a trend that seems to be trending upward.

Tony Bishop is an IT and data center technologist. The author of "Next-Generation Data Centers in Financial Services -- Driving Extreme Efficiency and Effective Cost Savings," Bishop is a former technology executive for both Morgan Stanley and Wachovia Securities.

As Chief Strategy Officer at The 451 Group, Tony is responsible for integrating the firm's value chain to create maximum impact for its enterprise, vendor, and service provider clients. Additionally, he serves as co-head of newly formed 451 Advisors, a strategy, planning, and ... View Full Bio
More Commentary
A Wild Ride Comes to an End
Covering the financial services technology space for the past 15 years has been a thrilling ride with many ups as downs.
The End of an Era: Farewell to an Icon
After more than two decades of writing for Wall Street & Technology, I am leaving the media brand. It's time to reflect on our mutual history and the road ahead.
Beyond Bitcoin: Why Counterparty Has Won Support From Overstock's Chairman
The combined excitement over the currency and the Blockchain has kept the market capitalization above $4 billion for more than a year. This has attracted both imitators and innovators.
Asset Managers Set Sights on Defragmenting Back-Office Data
Defragmenting back-office data and technology will be a top focus for asset managers in 2015.
4 Mobile Security Predictions for 2015
As we look ahead, mobility is the perfect breeding ground for attacks in 2015.
Register for Wall Street & Technology Newsletters
5 Things to Look For Before Accepting Terms & Conditions
5 Things to Look For Before Accepting Terms & Conditions
Is your corporate data at risk? Before uploading sensitive information to cloud services be sure to review these terms.