Experts Debate Banking 4.0 Impact on Data Centers and Edge Computing

Financial Services organizations such as banks, investment firms, and insurance companies are now facing the challenge of what to do with their existing on-premise enterprise data center assets. Are these data centers now obsolete and are cloud, colocation and edge computing the answer?

Technology trends such as Banking 4.0 are driving a continuous rethink regarding how IT architectures are being deployed. With “banking in the palm of your hand” becoming more the norm than the exception, enterprise data centers, many of which are 10 years old or even older, are having difficulty aligning technologies to adapt to changing marketplace needs. A recent webinar entitled “20/20 Vision: Physical IT Infrastructure for Financial Services” provides expert inputs on this issue from Bill McHenry, JP Morgan Chase (retired), Kevin Sanders, EYP Mission Critical Facilities, and Hugh Lindsay, Schneider Electric.

Finding the Right Balance: Edge Computing, Cloud or Both?

A principal question that emerges is how a hybrid (a mix of on-premise, cloud and edge computing architectures) IT approach should be properly balanced. Points of view differ but several observations were presented as considerations when evaluating enterprise data center investments:

• Enterprise data centers are in a fluid, transitional state – Many institutions are moving away from ownership of traditional enterprise data centers. Instead, partnerships with colocation providers are forming and loads are being migrated to other locations. However, a baseline capacity of on-premise data center capacity is still deemed mandatory for specialized protection, regulatory accountability and control measures.

• Applications and data centers are two faces of the same coin – The physical data center and the application portfolio that it supports are now more intertwined than ever. Changes in applications require changes in the data centers that support them.   One side of the coin cannot be changed without having a profound effect on the other. When this interoperability is neglected, performance and responsiveness are compromised.

• Anticipated capital outlays will force changes in investment behavior – Most financial services firms don’t want to spend money on data center technological upgrades, yet their data centers are rapidly becoming antiquated. That will force a large scale move towards data center downsizing over the next couple of years with cloud and colocation services filling in the data center processing power void.

• Big data means that data physical designs require more density – As the need for higher density compute and storage grows, existing lower density data centers will change. Higher power draws per square foot will produce more heat. Closer collaboration between IT staffs and application portfolio owners will be required for new, more efficient data center designs to emerge. This will imply more thermal containment, more power, and the flexibility to move power around.

• High performance computing (HPC) on the horizon for banks – Digitization and the rise of the Internet of Things (IoT) is driving an intense need for optimized data analysis. HPC infrastructures, once the domain of governments, research labs, and universities are starting to appear within banking environments. In fact, the banks will want to keep these facilities within their tight control for both latency and security reasons.

Despite differing opinions, experts agree that successful hybrid data center models will require the proper mix of enterprise, colocation, cloud and edge data centers in order to quickly adapt to changes in the marketplace.

Access Financial Services Webinar NOW

Hybrid IT data center infrastructures will play an important role in helping financial industry stakeholders implement digital transformation and successfully enable them to deploy on premise, cloud and edge computing solutions that bring Certainty in a Connected World. To learn more about options for evaluating finance industry enterprise data center strategies, view the OnDemand webinar “20/20 Vision: Physical IT Infrastructure for Financial Services.”