Business Case Report

Build Or Colocate? The ROI Of Your Next Data Center

August 20th, 2013
SV
Sophia Vargas
RD
Rachel Dines
With contributors:
Doug Washburn , Eric Chi

Summary

Data centers are running low on space, power, and cooling capacity. When it comes time to provision new data center capacity, IT infrastructure and operations (I&O) professionals face a critical decision: build or lease. So what should you do? Forrester evaluated the leading approaches to expanding data center capacity, comparing traditional data center building, modular building, and leasing from a colocation provider. We applied Forrester's Total Economic Impact™ (TEI) analysis to a generalized facility starting at 500 kilowatts (kW) with an annual IT power consumption growth rate of 10% and found that, while modularly built data centers are more economical than their traditional counterparts, leasing is still the lowest-risk solution for many organizations. This report, and the TEI model that accompanies it, will help I&O professionals decide when to lease and when to build a data center given their unique circumstances.

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