Deciding to deploy on-premises infrastructure can present many potential issues for the modern service provider and getting it wrong can be costly. Historically, the only real option for hosting environments on-premises involved large outlays of capital and taking on equally large amounts of risk in the hopes of properly monetizing the equipment. However, as the industry has evolved and on-demand becomes increasingly popular, a new avenue has emerged for service providers with full-stack on-premises cloud offered in a consumption model.
Rather than having to invest capital to purchase storage and compute servers to host on-premises, companies like Zadara provide the option to host these resources delivered as a service freeing up capital expenditure. Hundreds of service providers have made the switch to grow their revenues and lower risk while enabling them to take on customers with a wider range of hardware requirements.
In this blog we’ll take a look at how on premises infrastructure delivered through a cloud consumption and management model is helping to change the service provider industry, specifically as it pertains to areas of risk and economics for their customers.
The Perils of Provisioning Risk
Service providers who host data on-premises are well-acquainted with the risks of over or under provisioning. They are required to predict their future infrastructure needs accurately. This enables them to allocate resources in a manner that maintains the organization’s competitive edge while sustaining business operations. Effective provisioning holds significant importance for service providers, as it not only influences pricing but also impacts the capacity and speed at which new customers can be brought on board.. In short, provisioning infrastructure for current and future needs is existential for service providers.
In this regard, being able to consume on-premises hardware in an OpEx model is a major advantage. Because resources can now scale up and down much quicker and at a significantly lower cost than in a CapEx model, service providers can now avoid the guessing game involved with provisioning. Moreover, because their hardware is so much nimbler, service providers deploying such environments are now able to more easily serve customers who require either temporary environments, or whose risk profile was initially too high to justify purchasing the necessary equipment to support them.
For AsureStor, a Zadara service provider partner who specializes in backup, being able to consume on-premises hardware in an OpEx model has revolutionized their business. When dealing with multiple customers who occasionally needed to restore data simultaneously, they initially needed to significantly overprovision resources, a scenario that was rare, yet critical to their business. However, thanks to Zadara, they can now simply spin up extra servers in the event of a peak in demand. Thus, they have been able to reduce their own risk exposure and take on more clients.
Consuming on-premises hardware utilizing an OpEx model as a service provider can be economically transformational. The act of doing away with massive capital expenditures frees organizations from the three to five year hardware refresh cycle that monopolizes funds which could be easily invested elsewhere in the business. Also, because Zadara offers free hardware upgrades for the life of the contract, customers can fully break free of ever needing to worry about refreshing their hardware ever again.
However, beyond freeing up huge amounts of financial capital, Zadara’s solutions can also liberate large amounts of human capital thanks to fully managed resources. The advantage of this is that the customer no longer has to dedicate time to monitoring the health of the system or dealing with broken equipment. For example, should a drive need to be replaced, the customer’s only responsibility is to physically replace the drive and the rest of the backend is handled remotely by Zadara engineers who specialize in storage and compute infrastructure.
A special feature of Zadara, which serves to improve the economics of their on-premises solutions even further, is the fact that service providers can now monetize unused capacity without having to dedicate either human or financial resources. Zadara operates a program called the Federated Edge, which essentially acts as a collective wherein unused capacity at a service provider’s location can be utilized by a different Zadara customer who will then pay a fee to the service provider for hosting their data. This is especially advantageous in cases where customers are looking for backup locations in different geographies.
Built for Service Providers
The Zadara on-premises model has been revolutionary for the service provider industry. By allowing organizations to free up huge amounts of financial and human capital, they have offered huge amounts of internal flexibility as well as the freedom to expand one’s base of potential customers.
For our part, Zadara has aided this in crafting storage and compute solutions that are made specifically for service providers, and we are currently supporting hundreds of such organizations who themselves represent thousands of customers.
To learn more please feel free to speak with one of our cloud specialists.