Data centers, which initially made their major appearance in India in mid 1990s, have matured into essential business drivers. As is visible today in many Indian organizations, data centers have evolved from being looked at, as mere 'technological fancies' to actual business requirements.

The earlier argument of poor connectivity going against centralized infrastructure in India is no longer valid. With factors like swift connectivity from multiple service providers, easily available technical expertise, and decreasing implementation costs, India is all set to emerge as an important data center hub of the world.

With the launch of data intensive services such as video calls, Live TV, video-conferencing, high-speed online gaming and so on, the need to store and launch various application-based services is expected to fuel greater spending on building storage infrastructure. These factors are poised to increase in the opportunity in the Indian data center services market.

Why are Data Centers important?

Data in India usually comes from telcos, financial services, and banks, call centers and the new source now being added in is social media. These organizations require customer/supplier interaction over the organizational network. Even the slightest downtime or performance lag can cause irreparable loss of valuable customers, reputation, and business damage. It can also be detrimental to employee productivity levels, especially for businesses dealing with outsourcing.

Distributed infrastructure models can be fatal for such businesses. These models usually produce multiple information silos, which are highly failure prone, hard to manage, harder to detect/recover from failure, and difficult to scale.

This is why it is beneficial for organizations to deploy data centers. Data centers also offer cost benefits on fronts like hardware, IT capital expenditure, and management/administration.

Types of Data Centers:

Co-Location Data Centers-For an organization with a small IT team, hosting at an external Internet Data Center (IDC) is more viable. All the data and applications are owned by the organization. Only the hosting services are hired.

In-house data centers-In the case of large organizations, it is always best to use the organization's own data center to have the best performance, management, security, and accessibility

Data center standards

In India there are many best practices and standards used widely. Some of these are for power, data cabling, dust & humidity levels, and heat convection.

IT Infrastructure Library (ITIL) and IT Service Management (ITSM) standards are becoming increasingly popular with data centers.

The Road Ahead

Indian data center services market is projected to grow at a 23-percent CAGR till 2012 to touch Rs. 11,800 crore.

“A virtualization-led consolidation strategy seems to be the common thread across most data centers in India, which would lead to moderate capacity growth,” said Naresh Singh principal research analyst at Gartner. “Indian data center managers are becoming increasingly concerned about facilities (power, cooling and space) and disaster recovery (DR) for reasons of cost optimization and business continuity.”

“Indian telecommunications service providers such as Reliance, Tata, Airtel and Sify have rapidly expanded their data center business during the last three years, adding several hundred square feet of data center space in the Tier 1 cities — primarily in Mumbai, Delhi, and Bangalore,” said Naveen Mishra, principal research analyst at Gartner. “Carrier-neutral hosting providers such as Netmagic and CtrlS have had strategic investors funding them to expand their operations by building new sites in cities such as Mumbai and Bangalore”

Other players are entering the market, including Indian telecom service providers, such as Tulip, BSNL and MTNL; and system integrators such as Dimension Data (earlier Datacraft Asia), SIS and Trimax.

When it comes to data center-driven businesses, telecom, and BFSI segments lead the field. The main reasons for this are the data heavy nature and interaction with end users that are typical to both industries. These requirements call for a centralized data center-based architecture.

Another area that is going to start adopting data center-based operations is the manufacturing segment. With enterprise applications like ERP and CRM churning out huge volumes of data, data management is required even for function-centric distributed applications.

Gartner Research also implies that there is a general increase in interest by the investor community around data centers in India.

By: Pooja. Thakkar