Sentinel Data Centers, a New York-based data center provider that caters to large enterprises for whom it builds custom high-capacity data halls in its large East Coast facilities, is planning to start offering customers direct private network links to large public cloud providers, such as Amazon Web Services and Microsoft Azure.
Through a partner, Sentinel will be providing “capabilities to direct-connect to basically all of the major cloud providers,” Todd Aaron, the company’s co-president, said in an interview.
Large enterprises prefer to use cloud services over private network connections for both security and performance reasons. Being able to plug directly into AWS, Azure, IBM SoftLayer, or Google Cloud Platform is growing in importance among factors data center customers weigh when selecting a data center provider, and many providers have been expanding cloud connectivity options in their facilities around the world.
Many decisions companies make about their IT infrastructure in general today are made “under the shadow of cloud” if not about cloud directly, Bob Gill, a Gartner analyst who covers the colocation space, said in a presentation at the market research firm’s data center conference in Las Vegas earlier this month. “Cloud and colo are natural-born allies,” he said.
While enterprises can use network carriers to connect privately to cloud services from their on-premise data centers, it makes much more sense to take space in a colocation facility from where they can get that direct access to multiple cloud providers at once, Gill said. Large enterprises rarely use only one cloud provider, so having access to a variety of providers is important to them.
For Sentinel, the decision to build a portal for direct connectivity to cloud providers was driven by both existing and prospective customers, Aaron said. Having the option is appealing even to companies that aren’t currently using public cloud services, he said.
According to him, almost all Sentinel customers are Fortune 500 companies, including financial services firms, pharmaceutical and healthcare companies, as well as large IT service providers. Sentinel has also built a custom data center for Bloomberg in Orangetown, New York, together with Russo Development.
The company will be using a partner to set up the cloud portal, but Aaron did not disclose who the partner would be. Cloud connectivity will be available in Sentinel’s multi-tenant data center sites in Durham, North Carolina, and Somerset, New Jersey, data centers.
The cost of using data center services by the likes of Sentinel in North Carolina recently improved, as the state lowered the investment threshold for benefiting from data center tax breaks that massive data center operators like Facebook and Apple have been enjoying there. Sentinel tenants will be able to take advantage of sales and property tax on IT equipment and sales tax on energy purchases, Aaron said.
The new tax breaks will make North Carolina more competitive as a data center location against other states and especially its neighboring Virginia, which has cultivated one of the world’s largest and most active data center markets. Considering energy rates and tax incentives, the TCO in North Carolina can now be up to 15 percent lower than in Virginia, Aaron said.