Summary: We caught up with management at the UK’s Daisy Group to get more detail about its Azure public cloud services and internal use of Azure as it looks to consolidate its data centre footprint.
Footprint: Daisy Group has made a number of acquisitions in its 15-year history, which have left it with a range of data centre arrangements with some 2,000-2,500 racks across around 20 sites in the UK. Around half of its data centres have footprints in the low hundreds of racks range. The remainder are small and typically related to individual customer contracts. It owns the freehold on one data centre, in Birstall about 10 miles south of Leeds in northern England, which provides 350 racks across 12k sqft in four data halls. It also has 18 recovery centres across the UK each of which has computer room facilities for business continuity (BC) contracts.
Market: Most customers still require a data centre presence as part of a hybrid strategy, although Daisy has current capacity and is freeing up more as it migrates customers into public cloud. As networks have got faster and public cloud a more viable option, Daisy sees less of a need for ‘local’ data centres, ie. those that are geographically close to the customer. Customers are demanding high quality facilities at the lowest price point, and often the two are best served by the larger data centre providers that have built at scale.
Consolidation: Daisy’s aim is to reduce the number of existing data centre locations, but which ones will depend on customer demand and the timing will depend on when leases expire. Decisions will be made on a case-by-case basis. New contracts, either with existing or new customers, will be directed to Daisy’s larger, more strategic data centres. Daisy expects to have a ‘significantly consolidated’ estate in five years. The ideal scenario, as long as it met customer requirements, would be to have deployments in large data centres in four key locations: East London, West London, North England and Scotland.
Internal cloud strategy: Daisy has been using AWS and Azure internally for services delivered via portals to customers, with AWS primarily used by its internal developers. It has decided to shift more internal workloads to cloud and selected Azure as its main provider, although it will still continue to use AWS. Between 1k and 2k VMs are candidates to be moved to Azure. It selected Azure for a number of reasons that included the existing partner relationship, the active Microsoft sales team in the UK, the scale of Microsoft’s operations, in particular its developer operation and pace of innovation, and the needs of its mainly Windows customer base.
Customer cloud strategy: While the public cloud providers have the advantage of scale and are able to devote significant resources to innovation, Daisy believes it has a key role to play because it has UK data centres for governance issues, it knows its customers and their IT environments, and it is a trusted MSP and advisor. Recognising the growing appetite for public cloud services to deliver greater agility and quickly provision new services, Daisy decided the best way to serve its customers was to become an expert in one provider. It chose Azure although it has provided and will continue to offer other public cloud services to meet specific customer requirements. It views Azure as a ‘business-friendly’ cloud, due to its local locations, work around compliance and security, and transparency in how it works. It is also straightforward to move customers to Azure, as they are in the main SMEs running Microsoft infrastructure stacks. Daisy has been building up its Azure skills over the last couple of years and around 150 of its 400-strong solutions engineering team have been fully trained. It has also built out reference architectures, templates and product portfolios within Azure, along with complementary managed services offerings covering on-premise, data centre and cloud.
Demand: Daisy has around 600k customers and is seeing strong demand for public cloud services, ranging from using Azure for DR, deploying on a workload-by-workload basis to multiple customers moving their entire IT environment to Azure. It is also seeing interest from new customers. In the main, customers are not just migrating their existing configurations but are modernising/optimising their infrastructure to work in Azure, so Daisy is seeing more demand for PaaS deployments than IaaS.
M&A: M&A has been a key strategy for Daisy to diversify its service portfolio and grow throughout its history, and management sees opportunity for further acquisitions to strengthen its public cloud offering. There is the potential for acquisition to give scale, but the greater opportunity could come through acquiring expertise and intellectual property around specific areas, workloads and capabilities. Daisy has a good scale operation to deliver what it calls data centre optimisation, ie. considering what workloads will run best in different environments and migrating them over. But as customers move to Azure they are able to access other services such as AI, data analytics and IoT, and they are eager to do so.
Angle: Daisy’s moves are a good snapshot of how infrastructure providers are moving to an asset-light model – running more workloads on cloud both for customers and internally. That hasn’t eliminated the need for third party data centres, but it can be seen how demand/need for data centre footprint will moderate over time. Hosters and service providers have already mostly shifted to colocation and have long been out of the business of actually building data centres. But as Daisy’s case shows, this is a process that is still ongoing. Cloud has been the driver of change.
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