Why Data Centers are Necessary for Enterprise Businesses

David Pasztor
September 18, 2020

As data has become an invaluable asset in the industrial world, data centers have become the powerhouses of many enterprise businesses. The need for power and data keeps increasing as the digital revolution pushes forward.

To meet current and future data management needs, every enterprise business needs the right infrastructure. And it’s no secret that cloud computing is the right solution for more and more businesses.

However, 37% of workloads in the U.S are still run on-premise. Moreover, the global data center infrastructure market will grow from around $155 bn in 2019 to about $230 in 2025, according to Research and Markets. So, why are data centers still necessary for many enterprise businesses?

Security and Control

A business that uses cloud technology gives full control of its IT environment to its cloud provider. An enterprise that has its own physical data center will have an easier time staying on top of its mission-critical IT assets.

If you have your own data center, you can easily change your security parameters, such as access controls. This makes it easier to prevent data breaches.

Organizations that have on-premise data centers can easily manage server bandwidth, power, and cooling. This allows an enterprise to easily identify inefficiencies in its network and optimize the deployment process.

While it’s true that there are many cloud providers that offer a great level of visibility to their customers, they still have full control of the customers’ servers. This can be a huge problem for enterprises that are in the finance, insurance, or healthcare industry.

Let’s say an industry examiner pays a visit to your financial organization. If you are using a third-party cloud-based system, they may want to take a look at your cloud provider’s third party audit report.

There are many cloud providers that have never had external audits of their IT. You may receive a lower security rating or your reputation with your customers may suffer if your cloud provider hasn’t had an independent third party audit.

Or let’s say you are the CIO of a larger company or a CEO of a small enterprise. If your sensitive data gets leaked or your systems go down, the board of directors will demand an explanation. They won’t like it if you tell them that the problem has happened because you’ve left the security updates, maintenance, and patches to someone outside of your organization.

Even a solid SLA (service level agreement) doesn’t eliminate all the risks of letting someone else handle your data. So, for many businesses, building an on-premise data center is the safest option.

Data Center Expertise

Compared to professional data center certifications, cloud certifications are relatively new. Even though cloud certifications are growing in prominence, data center training courses and certifications are well-established in the industry—and so are the experts who hold them.

It’s easier for an enterprise to find experienced employees that can take care of data centre safety, maintenance, networking, infrastructure, and other traditional, established tasks than it is to find seasoned experts in cloud deployment.

Troubleshooting is much faster when you have the expertise you need in-house. A cloud-based help desk that has to respond to thousands of customers on a daily basis is unlikely to provide the same level of knowledge and service as seasoned data center support staff.

So, having an on-premise data center is a great way to reduce unplanned downtime. Data management comes much easier when you have in-house experts that are very knowledgeable about your specific deployments.

Transparency of Management

Businesses that rely on cloud computing don’t always have the ability to ensure that they are making the most of available resources and that their applications are performing to meet SLAs.

Many cloud providers offer basic metrics only. Because of this, businesses that use third-party cloud services are often unable to customize reports to get the KPIs (key performance indicators) that matter to them.

An on-site data center that uses smart devices such as intelligent PDUs (power distribution units) with environmental sensors allows an enterprise business to collect all the data it needs to support its decision-making process.


On-premise data centers allow a business to configure its applications or hardware and allocate resources in the ways it sees fit. Moreover, they can make changes at any time. When a business has its own data centers, it can determine which of its physical assets will house its applications.

A business that has its own physical data center can use a range of uninterruptible power supply (ups) systems, intelligent rack power distribution units (iPDUs), and other hardware. It’s not tied down by a single vendor.

On the other hand, a business that has partnered up with a cloud provider doesn’t have the ability to fully customize and control its overall data environment and applications. If a cloud provider decides to make changes to its cloud management systems, its customers cannot prevent them.

If they want to migrate from one cloud service to another, the process can be time-consuming and expensive. Because of this, on-premise data centers are a must for enterprise businesses that are constantly focusing on growth.


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