There are two other compelling reasons for firms to consider going local with their data infrastructure, the first of which is the tightening of sovereignty laws all over the world. These regulations require information to be stored and processed within specific geographical borders, normally with a view to boosting the local economy, protecting the power grid or supporting data privacy. As a result, companies working in affected countries or regions are having to rethink how and where they gather, store and share information to stay compliant.
The second reason is the planet. Hyperscale data centers face growing scrutiny from policymakers and the public around their energy consumption and climate footprint. In fact, at the current rate of growth, data centers are expected to account for around 10% of global electricity use by 2030. Local facilities, especially those designed with energy efficiency and renewable sourcing in mind, may offer a more manageable and environmentally friendly approach — for both organizational and supply chain decarbonization strategies.
A hybrid model: what business leaders can do now
Of course, this move from vast, centralized data lakes to a network of smaller, distributed ones is a significant shift, especially as many organizations are well accustomed to the scale, agility and control of hyperscale cloud providers.
The future therefore lies in a hybrid strategy that combines the flexibility of the cloud with the performance and compliance benefits of localized networks. Here are five steps business leaders can take to start building tomorrow’s data infrastructure today:
- Assess your data flows and latency needs.
Where do your data flows originate? Where are your users? And what functions will require you to connect multiple disparate data lakes? Asking (and answering!) these questions will help you determine which parts of your operations are latency sensitive and begin preparing for how they could run locally. - Tailor your strategy to local requirements.
From the General Data Protection Regulation (GDPR) in Europe to emerging laws in the US and Asia, take the time to understand the different sovereignty regulations and policy hurdles that may impact your data handling — then prioritize infrastructure investments in those areas. Bear in mind, too, this may include state-level legislation. For example, Northern Virginia currently has a moratorium on data center builds due to the pressure being placed on the power grid. - Create sovereign cloud zones for compliance.
Once you have identified the specific applications and geographies where low latency is especially important, it’s a good idea to establish sovereign cloud zones that keep data within specific national boundaries to establish compliance without sacrificing performance or security. - Consider new markets.
To support a blend of centralized and localized infrastructure, you may wish to look beyond traditional regions in North America or Europe. Tertiary markets in, for example, Central or Latin America may offer shorter lead times for deployment, lower energy costs and other financial incentives for foreign firms that shift their operations there. - Embed sustainability and cybersecurity in your data strategy.
To support your sustainability commitments and comply with privacy regulations, try to be transparent about energy usage, carbon emissions and standardized cybersecurity across your local data facilities. This will enhance credibility and trust among stakeholders. You could also investigate innovative renewable power sources, such as small module nuclear reactors and thorium.
