V. LOBANOV: «DataPro intends to become the number one operator in the data center market, and it has all the opportunities to do so”
In the past, banks preferred to maintain their IT infrastructure exclusively in-house, believing that this was the best way to ensure the safety of data and to provide information security. But times change, and the financial and credit institutions more and more often have an eye for commercial data centers as an alternative. The reasons why banks come to such decisions and what services they can be offered by DataPro are mentioned by Vladimir LOBANOV, DataPro Development Director, in his interview to NBJ.
NBJ: Vladimir, in your opinion, how have the customers’ requirements changed, in particular, customers of banking institutions to the data centers? Could we say that they became stricter than ever?
V. LOBANOV: Let me answer your question as follows: What we must deal with here is not just changing requirements, but it’s mainly the choice of banks which quite often turn to commercial data centers. If banks earlier created and operated their own data centers, now many credit institutions are willing to consider the possibility of placing their IT infrastructure in commercial data centers. It is also connected with banks’ great attention to the issues on ensuring business continuity and recovery following emergency situations (DRP): on the one hand, there are changes in the banking activities regulation processes, on the other, the market offers reasonable proposals to support DRP for financial institutions (Disaster Recovery Plan – Plan for the business recovery after an emergency situation). International credit organizations working in Russia develop and maintain current DRPs and implement them at the facilities of the leading commercial data centers of the Russian Federation at all times.
NBJ: Are there any other factors pushing banks towards outsourcing?
V. LOBANOV: Of course there are some. The requirements for computational powers are constantly increasing, as data volumes increase literally on a real-time basis. Accordingly, credit institutions need modern platforms for installation of these high-performance systems. If earlier it was possible to deal with only server rooms within the bank, now these rooms do not solve the problem. This is due to expansion or modernization of the IT infrastructure, including the issue of capitalization, i.e. additional investments, planning, time for the purchase and implementation of the project, etc. Now we see that even the major players, who do not suffer from the capital deficit in recent years, consider the cost of ownership and expansion of the IT infrastructure. In most cases, if the calculation is done fairly, that is, taking into account all costs, IT architecture layout in commercial data centers is a more cost-effective solution than creating or expanding own data centers in terms of economy, flexibility, and deployment time.
NBJ: When we talk about outsourcing (no matter in what area), there are issues of information security and data integrity. Could they become an obstacle for banks to use commercial data center?
V. LOBANOV: Large data center operators, including DataPro, built their offers with regard to regulatory requirements for data protection. Our modern engineering infrastructure is designed in such a way that we could easily offer the option of equipment layout in our data center, taking into account not only the increasing demands for power consumption for the equipment located, but also all the safety requirements. In other words, you can create a data center inside a data processing center: allocate a separate room with access granted only to the Customer’s employees to create a separate perimeter-based security, to ensure the required mode of identification and access, etc.
NBJ: In other words, an individual approach is possible: we are not talking here about a box solution, in which nothing can be changed.
V. LOBANOV: Of course not. We understand well that, despite the similar nature of the requirements for the data center, all organizations have critical requirements from the point of business activity that we must consider. We consider this unique and highly qualified approach one of the main competitive advantages of our Company.
NBJ: What do you think banks should first of all look at when choosing a commercial data center?
V. LOBANOV: It is difficult to draw a universal model here, but I’ll try to prioritize main points.
Let’s start with reliability. In the absence of industry standards of data centers construction in Russia, you can use facilities available at the market and certified to the entire line of Uptime Institute Certification (not lower than Tier III) when choosing the platform for your IT infrastructure. This gives some assurance that the level of services guaranteed by the agreement with the availability of 99.982% (downtime shall not exceed 1.6 hours per year) will be provided.
The second very important point is how the selected data center meets your company’s growth at least in the medium term from the standpoints of ownership structure, the level of the selected technologies and development plan. For instance, all DataPro facilities are owned by the Company, and the scale of the selected facilities and technological solutions are able to support the development of IT infrastructure of the largest and most demanding credit institutions. Investment stability of the DataPro project provides our customers with long-term guarantees of financial stability.
The third point is the cost of ownership of the leased infrastructure we talked about earlier.
And the last point (in sequence, but not necessarily in order of importance) which I would like to mention and which we have already discussed is the ability of the data center to support the financial institution’s DRP. I would like to mention here that in the case of a DRP we are not talking about a single action, but a whole complex of measures aimed at minimizing of the risk of emergency situations and possible negative consequences for business to the highest possible degree. Geographically distributed data centers, together with infrastructure available for backup offices layout, allow you to implement full-fledged DRPs of financial companies.
NBJ: Who determines what measures should be taken in this case?
V. LOBANOV: Much depends here on the opinion of the owners and top managers of the business: for some a loss of control over the IT infrastructure may be critical, for others – a loss of communication with external customers or control over ATM network, etc. Thus, a DRP is developed depending on how banks determine their own priorities in this regard. The DRP shall specify in detail the responsibilities of specific departments or every employee in the event of an emergency. By the way, one of the requirements for such a plan can and should be the backup IT infrastructure and back-up offices layout on the basis of a third-party company not affiliated with the financial institution.
NBJ: We have heard that some companies consider loss of the building with operating unit inside as the main risk.
V. LOBANOV: They are right. This is a serious risk that must be considered, as in the case of loss of the building we can talk not only about the damage of the IT infrastructure, but also that the employees will lose the opportunity to get to their jobs and to restore the Company’s normal activities. DataPro offers the following: we have office space located directly in the data center building with total dimensions of about 4000 m2 in Moscow and 1000 m2 in Tver: these areas can be used for arrangement of back-offices of financial institutions that will provide the implementation of DRP.
NBJ: Does this mean that, when choosing a commercial data center, banks pay attention to the level of reliability that is determined by Uptime Institute Classification?
V. LOBANOV: Yes, this is a very important factor. We have decided to certify our data center subject to Tier III Certification requirements, which is the highest level for the Russian commercial data centers. Our Tver Data Center has been already awarded with Tier III Design and soon we expect to obtain Tier III Certification subject to any other parameters for the Moscow Data Center. I would like to mention here that in this case our data centers (both Tver and Moscow) will be two of the few data centers having Tier IIICertification by Uptime Institute. In Russia today there are only two commercial data centers that have the same level of reliability certification. At the same time, we actively support the work of the Data Center Industry Association, which currently creates working groups on the development of the Russian standard for design and construction of data centers.
NBJ: As far as we know, the data center in Moscow is under construction. What are its main characteristics?
V. LOBANOV: In the nearest future we plan to commission the largest commercial data center in the Russian Federation. Under full load it will be designed for up to 3,000 racks with IT equipment and a total capacity of over 20 MW. The data center is equipped with the most advanced cooling system available today in Europe and Russia – EcoBreeze, the principle of which is based on the effect of dynamic cooling.
Another important advantage is that here the company paid attention not only for reliability, but also energy efficiency. For this purpose along with EcoBreeze system diesel rotary uninterruptible power supplies (DRUPS) are used.
NBJ: Why is this moment so important when it comes to commercial data centers?
V. LOBANOV: We have already mentioned that one of the criteria for selecting the data center should be the cost of ownership, and this figure is directly linked to the cost of electric power. If right at the first stage of the project implementation the most economical solution in electric power consumption is taken, the consumer can expect to get the most attractive offer for him in terms of the cost of renting the back-up capacities.
Of course, you can choose the solution which at first glance may seem at the least expensive. But if energy efficiency issues are not worked out, the bank may very likely face a constant increase in the cost of ownership. It will just have to pay more for power consumption at a constant increase in computational power.
NBJ: When do you plan to commission the data center in Moscow under the full load? Did you determine certain time frames for this project?
V. LOBANOV: In August, we commissioned an area sufficient to locate 400 racks, and we will be able to put more than 800 racks for sale by the end of September.
NBJ: Have any banks already expressed interest in the Moscow Data center?
V. LOBANOV: Yes, they have, and those interested range from the largest financial institutions that used to follow a conservative approach and preferred to deploy back-up facilities onto their own platforms to those banks that already have experience of working with commercial data centers.
As I’ve already said earlier, the credit institutions’ attitude towards outsourcing in this issue is changing as the use of commercial data centers is the more cost-effective solution, especially if it is possible to enter into a long-term agreement with data centers service provider. Here we also see one of our competitive advantages. Buildings housing our data centers (in both Tver and Moscow) belong to our Company and the land plots on which they stand are in lease for 49 years. Therefore, in any case it is not a great issue for us to enter into ten-year contracts with our partners. Moreover, this contract can be either standard (for the provision of IT services) or in the form of lease agreement for any process room.
NBJ: The question that always arises when it comes to outsourcing is to what extent are the company’s services available to banks that do not occupy the top positions in different ratings and are, as they were called before, to be average performers?
V. LOBANOV: They are readily available; moreover, they are the most profitable. Medium-sized players tend to avoid the costs of non-core business activities, and creation of own data center falls into this category. The bank, in case it decides to create or construct of its own data center, will inevitably have to hire contractors to design and build a data center, to allocate funds for the purchase of equipment. Quite often, it is necessary to draw current staff members away from their core activity or to find and hire new staff to oversee the implementation of the project and subsequent operation of the data center.
Besides, as I’ve already said, we maintain the most flexible approach in dealing with potential customers: an average bank could rent a necessary amount of racks and gradually increase the capacity as and when necessary. For any of our customers, we are able to offer the most convenient way to provide and pay for our services.
NBJ: Please tell us about the future plans of you Company as a conclusion of our conversation.
V. LOBANOV: In our development strategy these plans are set out clearly and laconically: DataPro intends to become the number one operator in the data center market. I am sure that we have all possibilities to do this.