How to Estimate Data Center Expansion Costs

So now you want more. You want additional data center facilities to add servers, data storage units, racks, cabling, and network connections because your current data center is already maxed out. Data center expansion sounds like the way to go if you can get budget approval. The question is: what should go into the budget?

Building It and Running It

Even if the initial estimate for constructing an add-on facility raises eyebrows, you must also factor in operational costs. The total cost of ownership, or TCO, is the overall metric to use. IT hardware and software vendors have been using this concept for decades, so it should be easy to grasp regarding data center expansion.

Specifying the New DC Facility

If you already have one data center in operation, will the additional one be more similar? Not necessarily, for the following reasons:

• Data center technology continues to evolve (a DC over 7 years old is considered to be obsolete by industry observers Gartner, Inc.)
• Your own business needs may have evolved. Perhaps you started with Tier 1 facilities, but now you need Tier 4 (or even vice versa).
• Your first DC was over or under-dimensioned. There’s no point in repeating earlier mistakes.

Floor space, availability/business continuity, power requirements, and desired location are major factors determining the right choice of a site. However, grabbing a site first because it is affordable, available, or both and then trying to shoehorn new DC facilities into it is the wrong way around.

Numbers for Budgets Don’t Come Out of Hats

They are unlikely to come from publicly available web pages, either. Web pages can hint at what’s in store and quote sample figures for costs per square foot or per megawatt of power. However, even if you end up in the right ballpark for your project, this may be no more than a coincidence.

Budgeting typically needs to be zero-based (from scratch), starting with business objectives (capacity, security, future needs) that are then accurately translated into DC building characteristics and features.

Extra Bits and Pieces

Data center expansion is already a complex matter for the reasons given above. Two further things can upset an otherwise carefully prepared budget:

• You forgot to include items such as the possible cost of moving systems and data between the current DC and the new facility.
• Factors like LEED project and construction criteria help make the new facility as ecologically friendly as possible.

Wow, Is It Really Going to Cost That Much?

Some additional data center facilities are very big-ticket items. After spending around $120 million on its data center facilities in Singapore, Google signed off on a $380 million expansion. Budgets can also be bigger than funds available, whatever the levels under discussion. If so, other solutions may be preferable. They may include the use of colocation facilities, where all-in monthly fees can be easier to handle and more affordable.

Is modular design the solution for easy expansion of data centers? Share your opinion with us with a line or two in the space for comments below.

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