Focus on Core Business and Leave ‘Time-consuming’ IT Operations to Experts, Says eHosting DataFort at Data Centre Strategies Middle East 2010

Published June 2nd, 2010 - 07:43 GMT

Up to 80 per cent of IT budgets are being spent on operations and maintenance in organizations across the region leaving little time to focus on their core business, according to Yasser Zeineldin, CEO, eHosting DataFort, the region's leading Managed IT and advisory services provider and a member of TECOM Investments.

Zeineldin put forward his views at the Executive Leadership Roundtable during the two-day Data Centre Strategies Middle East Forum and Exhibition held recently at the Injazat Auditorium in Abu Dhabi.

Moderated by Ghazi Atallah, Managing Director, neXgen Advisory Group, the roundtable brought together some of the most knowledgeable industry representatives in the region including George Pawlyszun, Director of Strategy and Business Development, Injazat Data Systems; Anthony Foy, Group Managing Director, Interxion; Bryce Nelson, Chief Technology Officer, Kulacom Communications SPC, and Steve O'Donnell, CEO, Meeza.

During the session, Zeineldin presented the challenges businesses across the sectors and the data centre industry face in the Middle East today. With the help of statistical data, he suggested that issues including data centre space, power and cooling, aligning IT with business activities and making the most out of tighter budgets are some key concerns for companies. Managing the rate of change of technology and developing a public/private cloud strategy was also ranked high on the agenda among organisations in the region.

In spite of this, Zeineldin also presented data to suggest that the Middle East shows encouraging signs in the uptake of outsourcing IT to third-party managed service providers. He drew the audience's attention to market research reports that reveal regional organisations are already shifting their business models to one that is more intensive in operational costs over a business model that requires huge upfront capital investment.

Zeineldin said: "Organisations in the region are realizing the need to convert from a CAPEX to OPEX business model. Tying up your liquid assets into IT equipment which then requires additional costs to hire a specialized workforce to maintain and update is a costly exercise. However, in following a pay-as-you-go model, businesses are able to take advantage of a third-party managed service provider that has the latest IT infrastructure and a specialized team of engineers and consultants to help manage the mundane daily operations of IT. At the same time, businesses also lower their risks through mitigating their financial costs over a period of time."

Zeineldin identified the scenarios including when it would be ideal for businesses to either lease data centres from a managed service provider or build one of their own.

He added: "Companies can benefit from either of the two models depending on their financial model and a number of other factors. For example, a company requiring a small-sized data centre with low availability and uptime should consider leasing a data centre rather than building one itself as it is more cost-effective. However, a medium-sized company requiring only low availability and low uptime may find it more cost effective to build its own data centre.

"At the end of the day, if a company lacks the necessary skill sets, technologies or IT infrastructure required for handling day-to-day operational activities, it would be ideal to consider leasing data centre services to a third party service provider that can take care of tasks including backup, storage, security, monitoring and network management."

Discussing the concept of Cloud Computing, Zeineldin emphasised the need to consider offering services including virtualization, hybrid data centres and the private cloud before introducing public cloud services to enterprises in the region.

He pointed out: "Cloud services are already being used in the region by individuals and small-sized companies. Even though there is a big push to use 'Cloud' services for larger enterprises, government entities are more inclined to move parts of their IT infrastructure towards a 'Private Cloud' service since challenges over the legal framework and security protection of enterprise data is yet to mature."

According to a Gartner report in 2009, nearly 29 per cent of IT budgets in companies that have in-house data centres is allocated to people costs with 50 per cent spent on hardware & software. Figures in the Economist Intelligence Unit (EIU) report also suggest a faster rate of implementation of new technology in the UAE and other GCC countries. With an increase in IT spending of 12.4 per cent in 2009, the UAE is set to spend almost US$5 billion in IT by the end of 2010.

Following the Executive Leadership Roundtable, the audience raised a number of questions on the benefits of choosing co-location versus managed services and the vast opportunities for the data centre industry in the region thanks to its global strategic location and significantly low cost of power.

eHosting DataFort was also honoured with the 'Best Co-location Service Provider' at the Data Centre Strategies Awards 2010.

The two-day forum and exhibition attracted some of the region's major managed service providers, telecom providers and government entities.

With world-class data centres that have resilient and scalable infrastructure and round-the-clock managed operations, eHosting DataFort has a wide network of technology and channel partners based in the GCC and MENA regions, Europe, North America and Asia-Pacific. 

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