Leveraging a Global CDN or Building Data Centers: Which Should Your Enterprise Choose?

Sharon Bell is the Director of Marketing for CDNetworks, a global CDN provider that helps online businesses reach and delight their audiences around the world.

How do enterprises scale globally online? In general, they either build localized data centers in target regions or leverage a global content delivery network (CDN).

The decision requires weighing available resources with specific goals. For example, some goals might be to accelerate dynamic content, establish e-commerce in Asia, mitigate latency or Time to Interact (TTI) for users in Europe, or decrease global data management and security costs. To successfully and specifically scale an enterprise online, the following essential resources must be examined, measured, and properly allocated.

Budget

Building a data center network can be expensive to construct and maintain, costing about $1.6 million for a 1000-square-foot data center. Ongoing operating costs amount to about 65 percent of the data center build. Other costs include mandated fire protection, power and cooling supply, finding an adequate location and acquiring building permits, a specialized general contractor, physical security, and labor costs, including an expanded IT staff.

Outsourcing to a CDN provider does not require as many upfront costs. Even though staff to maintain a CDN from the customer standpoint is drastically reduced, extra expenses may be required to train current IT staff to remotely access the CDN through the provider’s cloud portal. The ongoing costs (and features) for CDN services vary from provider to provider, but they typically involve a monthly fee based on amount of traffic. The expense also depends on the specific content acceleration services employed. Sites with mostly static content will be cheaper to optimize globally on a CDN. While static may be cheaper, accelerating dynamic content with an application delivery network (ADN) add-on provides a more engaging user experience and may lead to wider site use.

Time

Time as a resource has ample facets when it comes to content acceleration options. Time to ROI can take a few years for a data center build; however, developing proper infrastructure with a data center as opposed to a CDN allows for significant control over the way in which content is distributed. The control that comes with decision making, including where to place the data centers, can yield peace of mind that content is delivered as efficiently as possible with minimal latency. Therefore, the data center is as good as the enterprise behind it. Since a content delivery network and infrastructure are already built, the time to ROI is considerably shortened when looking to reach a country supported by the chosen CDN.

Site performance KPIs like Time to First Byte (TTFB) and TTI in the target regions are required to decide whether to build data centers or leverage a CDN. Basics such as general latency due to target distance from the origin, network topologies, peering points, and the type of content to accelerate are essential factors to consider. The question only the enterprise itself can answer is, based on the variables unique to us, could our own data center or an existing CDN get our content there faster? And, is this a reliable method?

Scalability

Both a CDN and an enterprise’s own data center network can scale. As discussed above, however, a global CDN can help an enterprise scale quicker, since the network is already built and has the ability to handle spikes in traffic. Conversely, some CDNs may have more difficulty optimizing sites with certain SSL security and/or SPDY functionality than native data centers.

No matter which content acceleration route is taken, the site itself should be optimized for acceleration. Utilizing CSS sprites, enabling HTTP compression, leveraging browser caching, etc. will ensure content doesn’t take unnecessary trips or add TTI for unnecessary components. The larger the scale, the greater likelihood that revenue could be lost from slow load times. Speaking of large scale, e-commerce titan Amazon witnessed a sales drop of 1 percent for every 100ms of website loading delay.

Server Security

The level of security an enterprise maintains is also essential to protect it against threats and earn consumer or client trust on the site. The established CDN infrastructure provides protection against large-scale DDoS attacks, downtime and site crashes, and data loss. On the other hand, the enterprise’s network affords it a thorough and historical understanding of what is required to operate and protect the best interests of the enterprise.

Though the enterprise would have insight into how its data functions with a CDN, deciding not to outsource keeps control close, and theoretically, security measures on a tight leash. The question is whether the enterprise can adequately maintain the security of its servers in a different geographical region with its unique security and financial threats.

Cultural Liaisons

If entering a region with a different culture and/or mother tongue, the enterprise needs cultural liaisons to communicate effectively with its audience. If not on staff or contracted already, a cultural liaison is an extra expense required to understand how to approach the market as well as local regulations on behalf of the enterprise.

When electing to build a data center, employing cultural resources and creating good ties with the target region should be considered. The budget must include the cost of liaisons as well as a local network of influencers. Some CDN providers offer cultural liaison services as part of content and/or application delivery acceleration. This might appeal to enterprises because of their pre-established ties with local governments and insider knowledge on how to acquire appropriate permits and licenses.

Which Should Your Enterprise Choose?

Choosing whether to leverage a global CDN or build a data center network is a balancing act. How an enterprise values the time it takes to get up and running (CDN) as compared to their desired level of retained control (data center) are core factors of the decision. All resources should be weighed, budget items must be listed, and time-value-money (TVM) should be discussed. There is no formula for the right decision; however, thorough research with the goal in mind will help an enterprise determine whether it is best to build a data center network or leverage a global CDN.

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