In-House Data Center

To Own or Not to Own; the Pros and Cons of IaaS In-House Data Center Ownership

Recently, I was featured on GigaOM, discussing the pros and cons of in-house data center ownership for public cloud infrastructure-as-a-service providers. With the widespread media attention dedicated to recent outages, including Amazon’s latest downtime, it’s evident that maintaining consistent data center uptime can be a real challenge. So, are IaaS providers able to deliver resilient data center facilities in addition to their public cloud infrastructure offerings?

To begin with, the article describes that there are certain advantages for cloud providers operating data centers in-house. For example, those include greater control, capacity, power, and security. However, there are also challenges, such as geographic expansion, connectivity, location, costs and lower-tier facilities that often outweigh the benefits.

Pros of in-house data center ownership

  • High degree of control over facilities
  • Guaranteed capacity and easier expansion planning (within one building anyway)
  • Potential for greater power efficiency through specialization
  • Easier security management with a single-tenant facility

To Own Or Not To Own Pros And Cons Of A IaaS In House Data Center Ownership2

Cons of in-house data center ownership

  • Limited geographic expansion abilities
  • More limited connectivity options
  • Tendency to choose locations away from premium areas and network hubs
  • Tendency to run lower-tier facilities
  • Distracting to the core business
  • Very capital intensive

To conclude, running a data center is nothing like running a cloud. In fact, it can be a big distraction from IaaS providers’ core competency. Besides, with everything from security and redundancy to power and cooling requirинг to be operating at peak performance, running a data center is a full-time job. Consequently, by focusing on the cloud and not the data center, public cloud IaaS providers don’t need to make tradeoffs between investing in the data center over the cloud. Thereby, they ensure the cloud is continually operating at maximum capacity and performance with the best resources available.

Finally, the full article may be viewed at, and I’d be interested in hearing what you think on the matter. Should public IaaS cloud providers run their own data centers? Have the benefits of using a third party data center provider outweighed the drawbacks? If you have any thoughts on the subject, please feel free to leave them in the comments section below.


About Patrick Baillie

Patrick is co-founder of CloudSigma, and comes from a career working in Investment Banking Technology, as well as having previously ran his own business.