Cloud computing is the newest technological wave in the data center industry. Like it or not, managers are seeing a steady band of clouds on the horizon. To successfully deal with the changes the cloud brings, companies must recognize and address the repercussions of virtualization and the cloud.

The data center is the focal point for business strategies. In the increasingly competitive global business environment, companies are seeking new ways to streamline their business processes. Front and center is the use of virtualization and cloud technologies.

A recent survey by AMI Partners found small- and medium-sized businesses find virtualization a key driver of market success. It found 75 percent of businesses feel that server virtualization is critical. And why not? Virtualization is a proven way to cut IT costs, improve utilization, and reduce electricity and cooling costs.

But there are also many challenges. To be successful, companies must ensure they have the right tools to unlock its full potential.


What’s clear is there’s no single definition of cloud computing. Truth is, the term means many things to many people. Really, cloud computing is the ability to store computing processes, programs, and information online rather than on a local hard drive. In addition, it streamlines the entire process associated with your IT infrastructure, without costly investments.

And the benefits are undeniable. As Tim Anderson, wrote on the The Guardian’swebsite (June 21, 2010), “Reasons [for implementing cloud] vary, but often include the desire to outsource the maintenance burden of servers and applications; the need to scale systems up or down on demand; the benefit of being able to access your data from anywhere with an Internet connection; and the ability to replace occasional heavy expenditure on IT with regular and predictable operational expenditure.”

But while the benefits of the cloud are undeniable, many companies wouldn’t have taken the leap if they weren’t pushed.


New information is being generated every day. Every e-mail, every application, every piece of data adds to what IDC calls “The Digital Universe.” And it’s the explosion of this digital universe that’s driving virtualization and cloud.

IDC defines the Digital Universe as the amount of data being created and stored each year. According to the firm, this flood of information will reach 1.8 zettabytes in 2011. IDC equates this to enough information to fill 57.5 billion 32 gigabyte iPads. IDC also estimates the amount of information managed by data centers will grow 50 times, while the number of files requiring storage will grow by 75 times (see figure 1).

The more information you have, the more room you’ll need to store it. That means bigger physical data centers.

In a May 2011, Uptime Institute survey, 36 percent of respondents said that they expected their data centers to run out of space, power, or cooling by 2012. To make matters worse, IT budgets continue to be slashed.

That contradiction poses a challenge, and many suggest the cloud is the solution.

fig 1

Figure 1. Storage growth from 2005 to 2015 (projected) Source: IDC Digital Universe Study, sponsored by EMC, June 2011. 



In an effort to combat exploding data and lack of space many are turning to virtualization. As IDC points out, “For organizations to offer their own cloud services, they have to do more than just run virtual servers. They must also allow for virtualized storage and networking, self-provisioning, and self-service—and provide information security and billing. Few enterprises are here yet, so the impact of private clouds on the digital universe today is small. But by 2014, when the virtualized infrastructure is more common, the rate of growth will accelerate.

And by all accounts, the market is responding. Investments in cloud-related expenses are expected to be one of the fastest-growing technology segments in the world. Underscoring this trend, industry  analyst firm Forrester Research recently took a close look at the market. In their recent report, “Sizing the Cloud,” the firm pegs the current cloud market size at $40.7 billion. And analyst firm Yankee Group estimates total cloud revenues to reach $22.3 billion by 2014.


Many firms have tried to get a handle on just how much power is consumed by today’s data centers. First, let’s start with the cost of power, which always seems to be trending up.

The U.S. Department of Energy estimates the price of energy continues to rise, estimating global demand for energy will grow a staggering percent. And it’s the data center that’s consuming a significant amount of this energy.

The Environmental Protection Agency (EPA) reports that data centers consume as much as 20 times more energy per square foot that a typical office building. Their report says energy used to power data centers is as high as 60 billion kilowatt hours—equal to 1.5 percent of all power used in the United States!

This revenue hit is a big liability for companies trying to survive in this tough economic climate. The reality is that the sheer cost of power is making it a liability in the data center. As an article in KM Worldpoints out, “When it comes to computing, power used to be an advantage: the calculating speed of processors. But now IT managers are equally focused on power as a liability: the energy bought and managed to run those processors. By some estimates, data center energy consumption has almost quadrupled in the past decade, as more and increasingly powerful servers are brought online to answer queries, stream content, complete transactions, and perform calculations and analysis in every sector of society and the economy.”

This revenue impact now has the attention of the CFO, as increased costs are impacting the bottom line.

fig 2

Figure 2. According to the Yankee Group, total cloud revenues are accelerating in growth. 2011 Enterprise Cloud Services Forecast: Revolution or Evolution, Cloud is Moving Fast, January 10, 2011. 



Clearly, companies need to pay closer attention to their use and misuse of power in the data center. Data center managers can no longer hide in the back room, hoping to fly under the radar. Their job is now front and center, as inefficiencies in a company’s data center can kill profits. A February 2007 article on the ElectronicsCooling website noted, “Historically, the cost of energy and the cost of the data center power and cooling infrastructure have not been on the radar for most chief financial officers and chief information officers and have not been considered in TCO models…This was a reasonable assumption during the ‘90s, when server power and energy costs were substantially lower. However…power density has been increasing at an alarming rate.”

One thing is clear: Data center managers need to know how much power they’re using and how much they’ll need. But that is not always the case. The Uptime Institute, which surveyed data center owners and operators, reports, “But despite the concern over data center power consumption, many data center managers don’t see an electricity bill. Nearly three-quarters of the organizations surveyed said the real estate or facilities department paid the utility tab. Eight percent of respondents said they had no knowledge of who paid the bill.” Uptime Institute said the situation shows a “huge disconnect with IT and energy consumption.”

So, the need is there, but the tools are not. So, how can CIOs keep a mindful eye on the power they’re using, while planning for the future?


So what’s first? Companies should start by knowing their power paradigm. This is where a proper audit is essential—evaluating the data center power path leading to current servers, the efficiency of existing transformers and even a kilowatt-per-cabinet analysis of existing server rooms. This audit allows companies to optimize their current power distribution and plan ahead for denser server loads.

Recently, Elsa Wenzel reported on the PC Worldwebsite that a proper energy audit is the only way most companies can know how to save, “Sluggish sales and hard-to-get loans might blight the business landscape, but cutting energy waste can bring a big payoff to a small company. To shave liabilities off your profit-and-loss statement, aim to slash your power consumption … An energy audit creates a portrait of the energy demands that matter to your operations—as well as those you can do without—and it can lead to skinny electrical bills and fat tax breaks.”


Knowing current energy use levels and patterns is a requirement for setting energy goals.

That’s where a branch circuit monitoring system (BCMS) comes in. An effective system can monitor down to the server branch and circuit breaker. It provides real-time load currents and voltages. The correct calculations will focus on total power on the panel level (power, apparent power. reactive power, power factor, and load)—as well as the branch level. The right system will provide warning and alarms alerting customers to their adjustable current, and whether a customer is over voltage or under voltage.

System improvements simply cannot be made without taking the right DCiE and PUE energy and power usage effectiveness measurements. These measurements enable companies to deal with higher energy costs, the need for increased data center capacity, and the increase in energy usage.


So what type of power distribution design is right? The straightforward answer is: No one scenario works for everyone.

For some, the traditional raised floor configuration seems a logical choice. But times have changed. The time it takes to build or retrofit a raised floor model could take years—adding extra costs to the process. Some new power distribution systems allow facilities managers to circumvent the raised floor plan. And it doesn’t come at the cost of performance. These modular, overhead bus lines are relatively easy to install and don’t disrupt the concrete structure.

For those who want to develop an entirely new data center, the answer might be quite different. In this instance, a containerized data center—housed either indoors or outdoors with its own power and cooling—could be the right fit.

PDI Inc. worked with PeakColo, a leading private, public, and hybrid cloud solutions provider. The company focuses on helping customers maximize their investments in virtualization and cloud. Key to this is PeakColo’s ability to gain real-time, actionable information on energy usage for its customers. The company quickly realized it was hindered by having to manually calculate and report on customer power usage using handheld meters.

Says Luke Norris, founder/CEO at PeakColo, “Energy costs are quickly getting out of control. When you combine rising prices with the expanding size of today’s data centers, it’s easy to see why efficient energy management is so critical. To help our customers maximize their investments in virtualization and cloud, we needed to keep a close eye on our pass-through energy costs.”

To that end, the company found what it was looking for using a software solution that instantly uploaded client power usage data into the cloud—enabling managers to instantly access information and send customers accurate reports on energy use. Peak Colo ended up saving thousands of dollars due to previously inaccurate billing.


It should be clear by now the ability to audit the energy environment, obtain real-time reports, and predict for the future is key the success of today’s businesses. Now is the time to investigate and align with a partner who can help get a handle on energy use. 

About PeakColo

Company: Established in 2006 in Denver, PeakColo began and continues its focus on the Infrastructure-as-a-Service (IaaS) slice of cloud computing delivering public, private, Hybrid, DR, and custom solutions. As a Type II SSAE16/SOC1 company, PeakColo focuses on consistently sound operational procedures pushed down from our seasoned management team of industry experts.

Industry:Colocation, IaaS solutions

Operational Impact:Returned ROI investment in first month of deployment and reduced administrative costs by thousands of dollars.

Challenge:Automate and manage power utilization to help its customers maximize their investments in virtualization and cloud services.

Solution:To move away from manual power tracking, PeakColo turned to PDI’s PowerMap, a cloud-based power management solution, to help monitor and manage power usage and pass-through energy costs from its five data centers.

Quote:“Energy costs are quickly getting out of control. When you combine rising prices with the expanding size of today’s data centers, it’s easy to see why efficient energy management is so critical.” Luke Norris, founder/CEO of PeakColo.



Performance metrics from the Peak Colo facility. Image credit: PDI