Business Hardware

Data Centers Cut Budgets

About half of data centers are responding to the economic crisis by cutting their budgets an average of 15% for 2009, according to a new survey by the AFCOM Data Center Institute.

While the overall cuts were "surprising low" in the view of Jill Eckhaus, the CEO of the Association for Computer Operations Management (AFCOM), she said she doesn't want to minimize the impact those cuts will have on the 49% of affected data centers.

Eckhaus said the low number of data centers making cuts indicated their importance to the businesses. And while half are cutting, the budgets for the remainder are staying the same or going increasing.

That's important, because it wasn't long ago when data centers "used to be known as the money pit," she said.

For those data center managers that are cutting budgets next year, a large percentage of those cuts are aimed at big ticket items, including: IT equipment, 21%; IT support equipment (such as cooling systems), 16.5%; and staff, 14%.

This survey was initially conducted in May with 300 responses from managers of large data centers, which make up much of the association's membership. But in response to the economic downturn, a follow-up survey was conducted in late November. It prompted 133 responses.

The survey also found that 86% of the data center managers will expand their use of virtualization to either cut back or reduce the need for new physical servers.

About 13% of the managers said they had planned to increase or add software-as-a-service (SaaS) as an alternative to internally hosted applications.

With Travel budgets being slashed, nearly 70% of the respondents said they plan to increase their use of video conferencing next year to reduce travel cost.

Of the survey respondents, 23% said they planned to use cloud computing. And of those without plans to adopt cloud computing, 49% said it wasn't applicable to their data center strategy, while 16% raised concerns about security, 11% raised issue with the reliability of providers and an equal percentage cited cost issues. About 13% said they weren't confident with cloud service providers.

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