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As we spend more of our lives online and in the digital age, the exchange of information becomes increasingly necessary to keep businesses running. This digital exchange requires massive network and computer equipment, that are housed in a central physical location called a datacenter.

A data center is a computer room that houses storage and computing hardware for an organization or business. The primary elements of a data center include servers, that house the processing power needed to transform raw data into usable information, and storage devices that hold this data on hard-disk drives or robotic tape. A data center also relies on networking and communications equipment like routers, switches and miles of cables to help the flow between servers.

In the 1990s, when IT operations grew and businesses began to use cheap networking equipment to house their networking hardware in central locations, the term « data center » was the first to be used. Businesses can either construct their own data center on their premises or work with a third party provider of data center services who offer colocation and managed services. Third-party providers typically offer the most cost-effective and energy efficient alternative to data centers that are on-premises.

Many of these options from third parties also offer greater flexibility in policy management. For instance the data center may provide multiple policy environments in a single location which allows IT to limit the workload of data by having distinct policies that satisfy the requirements for compliance across all geographies and business units. This can greatly reduce dataroom security risks and improve overall information governance.