Whether it’s for small enterprise companies that can’t afford to maintain and operate their own data center, growing companies needing to put their dollars into OPEX rather than CAPEX, or companies looking for updated server environments for consolidation and faster deployment, the use of cloud-based services/XaaS and colocation/multitenant data centers (MTDCs) offers significant benefits.


While they offer the appeal of a fully managed data center with all the required space, power, cooling, bandwidth, security and services, clouds and colocations aren’t for everyone. But let’s first review the key drivers and advantages behind this growing trend.

The Nexus of Forces

The combination of social media, mobility, cloud computing and Big Data—referred to by Gartner as the “nexus of forces”—is putting more information and power in the hands of consumers anytime, anywhere and on any device. And it’s all through the data center.

While data centers were once viewed as supporters of a business model, today they are the business model. With virtually all business now accomplished via the data center, companies are forced to keep up or fail.

Virtualization and energy efficiency are helping many cut costs and keep up with technology trends through their own data centers, but they can only do so much.

With the astronomical CAPEX required to build or upgrade a data center, many businesses are looking outside of their own organization at cloud-based services and MTDCs that provide all the space, capacity and services to turn the data center into a pay-as-you-go business model.

The Advantage to Succeed

With cloud-based services reaching towards a more than $5 billion market, and multitenant hosting space generating nearly $23 billion in 2013, these two growing areas combined deliver the advantages that today’s businesses need to compete.

With monthly fees for these services residing in OPEX rather than CAPEX, growing businesses that don’t have the capital to build out their own data center can get access to the technology they need to keep growing.


Large companies can consolidate and cut costs by removing the restraints of owning and managing several data centers in various locations—and gain access to real data center professionals and the latest technology.

Cloud-based services and open source data are making it easier than ever for companies to try new technologies and fail without the risk of losing it all. And with the advantage of fast deployment, there’s no need to wait for the approval, funding, equipment and time it takes to try it yourself. IT departments can sidestep internal bureaucracy and simply ask their cloud provider for what they need.

All of these advantages are even giving way to the growing business of cloud brokering—third-party individuals whose business is to act as the intermediary between cloud providers and companies to ensure success.

Download our 10 Steps to Holistic Data Center Design white paper

Not for Everyone

While the new business model for data centers is trending towards cloud computing and colocation, it isn’t viewed as the best or only option by everyone.

To maintain total control and detailed understanding of systems and data, some are sticking with their own designed and managed data centers—especially in markets where data protection regulations like HIPAA and PCI-DSS play a role. However, those faced with these requirements can still choose hybrid solutions where regulated data is kept in house and less critical applications are moved to the cloud or hosted on equipment under somebody else’s roof.

For those that over designed their data center and have the space and infrastructure keep growing, virtualization and energy efficiency might just be enough to keep up… for now. The space savings that comes with virtualization and consolidation also comes with higher density. While you might have the space, do you have enough power and cooling (or the ability to get more) to fully utilize that space in the future?

Whether you’re a cloud-based service provider or an MTDC, or if you’re a company striving to continue operating and maintaining your own data center, Belden has the experts to help holistically design and deploy a variety data center environment that ensure the redundancy, bandwidth and scalability to grow your business.

Holistic Design

To learn more about the concept of holistic design, download my white paper on 10 Steps to Holistic Data Center Design.