The decision to expand into a foreign market presents a unique set of challenges for CIOs. From assessing the logistics and benefits of owning or outsourcing your mission-critical infrastructure to selecting the physical location of your data center, there are a number of important factors or variables to take into account.
Today, organizations need to be both strategic and socially responsible. Selecting the right location for a European data center is as much about power consumption and energy efficiency as it is about proximity to end customers and connectivity reach to target markets. These all need to be aligned before you make your decision on where to locate.
Prioritize Your Enterprise’s Needs
The first thing that CIOs need to address is whether a location meets the technical and strategic requirements of the business. For example, does the location have proper access and connectivity into the target markets that matter most to your business?
Some countries offer greater access to a range of global telecom carriers and this offers CIOs greater flexibility in both cost and reach to key cities across the region. Others, however, are limited to specific national carriers that may have excellent network connectivity within the country, but lack the necessary reach to make them a viable option when seeking to connect to a wider European audience. A data center that is both carrier-dense and carrier-neutral provides the greatest amount of choice.
Proximity to your target market is another important consideration, particularly for those industries that require minimal latencies (i.e. financial services, e-commerce, online gaming, etc.). Finding a data center that has close proximity to your target markets helps to minimize latency by shortening the overall distance that your data travels. This has a direct impact on the quality of service experienced by end customers; the lower the latency, the better the service.
Once these considerations have been factored in to a broad strategic plan, CIOs can begin to discuss the issues of sustainability and efficiency.
Let’s look at a couple of examples of what CIOs should consider in making a data center location choice: the cities of Copenhagen, Denmark, and Stockholm, Sweden.
Copenhagen and Stockholm
While there are many cities throughout Europe that offer proximity and connectivity across the continent, there are few that offer the ecological, operational and financial benefits of Copenhagen and Stockholm. With access to geothermal, solar, hydro-electric and wind generated power, these cities have access to a nearly limitless amount of sustainable energy on demand, making them an ideal location for organizations with high power consumption needs.
From a strategic standpoint, both cities offer connectivity to the Russian market, giving organizations that want to build a customer base within the country the opportunity to do so without the necessity of a physical presence within Russia itself (a substantial benefit given the current political and economic climate).
While both Stockholm and Copenhagen share a great deal of similarities, each has their own defining characteristics.
Stockholm is considered one of the most innovative countries within the EU, and the government has very business-friendly economic policies. It also offers one of the greatest levels of connectivity within the Nordic nations, which provides access to regional carriers and cloud providers across Denmark, Norway, Sweden and Finland.
Copenhagen, on the other hand, offers connectivity to both Iceland and the U.S. (in addition to Russia) via trans-Atlantic undersea cables, giving it a unique level of connectivity to all three countries in addition to continental Europe.
Enterprises can derive the greatest value by collocating in both cities, as combined they are capable of reaching more than 80 percent of Europe’s GDP, giving them a high level of coverage across the continent.
It is also becoming increasingly important for organizations to have a better understanding of regional and national laws. These regulations govern everything from tapping into regional power grids to data privacy.
The recent repeal of the “Safe Harbor” agreement and then the adoption of “Data Shield”, and the uncertainty this volatility has caused, has led many countries to establish new data privacy regulations which require customer data to be held within the country.
This is now forcing U.S and international organizations to prioritize data management and customer privacy.
This entire data center expansion assessment process can be simplified by working with a strategic partner that knows and understands these regional and local complexities, and can help to strike a balance between satisfying your business objectives and being socially responsible.
(About the author: Lex Coors is the Chief Data Center Technology and Engineering Officer for Interxion. He is also a founding member of the Uptime Institute. Lex also holds a position at the Green Grid’s Advisory Council; is active as the Vice Chair for the Governmental Engagement Committee of the Green Grid; and works as a stakeholder for the European Commission DG Joint Research Committee on Sustainability and the European Data Centre Code of Conduct Metrics Group.)
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