Gartner says IT managers can cut colocation costs in Europe by moving North

Amsterdam, Frankfurt, London and Paris represent the major colocation centres for multinational and Pan-European businesses. However, power costs in Norway and Sweden have fallen by five per cent since 2010, while the EU average has risen by around 13 per cent in the same period. Moreover, combined with efficiencies from using outside air cooling there is a clear economic and environmental advantage to hosting IT infrastructure in the northern part of Europe.

‘It’s important to weigh up several key decision factors when considering moving workloads away from the major colocation hubs to Northern Europe,’ said Tiny Haynes, research director at Gartner. ‘However, in most organisations there are several IT functions such as data warehousing or browser-based apps that simply do not warrant the significantly increased running costs of colocation in a major hub.’

Gartner has outlined some key decision factors to consider in the decision to move north:

Network latency: Some applications like VoIP systems and virtual desktops need a low latency environment to function well, while others simply do not. Categorise applications and assign them a suitable location accordingly.

Application requirements: Some applications are standalone, while others are integrated with a range of connected systems. If the application is interdependent, it’s best to keep all the constituent parts within the same data centre infrastructure to avoid timeouts.

Security compliance: Data protection laws vary between countries, and certain data or applications that use data may not be suitable for use outside specific geographies.

Power availability: Consider not just the availability to your rack, but also to the data centre and the country itself.

Cooling costs: Consider both the ongoing power usage effectiveness as well as the cooling methods available.

Price: The price of per kilowatt (kW) of infrastructure as well as per kilowatt per hour should be evaluated.

Support: This should either be in-house support from technical teams nearby or support provided through the supplier.

‘If considering these factors reveals an opportunity to move workloads and applications to another location, it’s also very important to properly map out the costs over a lifecycle,’ said Mr Haynes. ‘A cost estimate should be considered over at least three years and take into account several price components that make up the total cost.’

Common colocation costs include:

Colocation setup: The vendor charge for the commissioning of space with power, network and cooling infrastructure.

Migration: Cost of moving hardware and applications between data centres, including project management, transportation and even staff out-of-hours costs.

Rental: Cost per kW for the data centre space and infrastructure.

Power Consumption: Cost per kW per hour for energy used.

Support: Cost of remote hands or in-house travel.

Decommission: The removal charge from the provider at the end of the contract.

‘Once these criteria are applied, it’s likely that most organisations will find some workloads that can be moved to a lower cost location without impacting performance,’ said Mr Haynes.

More detailed analysis is available in ‘Save Up to 50 per cent on European Colocation by Choosing the Right Location.’ The report is available on Gartner’s Web site at

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