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— Blog

Out with the Old, and in with the New Infrastructure

Val Walsh, Senior Vice President
March 29, 2019

Infrastructure serves a vital role in ensuring business operations run smoothly, efficiently and cost effectively. For example, infrastructure underpins everything a large bank does – from retail transactions to fraud detection. And, no matter how stable existing infrastructure appears on the surface, it is vital to ensure that it remains appropriate for the ever-changing environment.

Our latest research has revealed that almost a third of the UK’s largest financial services institutions say that legacy infrastructure is one of the biggest issues they face when preparing for the industry’s newest technology.

As businesses and their tech requirements grow, upgrading legacy systems becomes more costly to sustain. Whilst some may argue that there is also a financial cost attached to outsourcing your infrastructure, the benefits of doing so often far outweigh the financial burden of maintaining outdated systems.

Five ways an infrastructure face-lift will benefit your company:

1) Improved functionality

One of the biggest headaches that companies face is whether their existing infrastructure can support and integrate the constantly-evolving technological advancements. Over a third of IT decision makers in the UK’s largest financial services companies have said that artificial intelligence (AI) is the next big technological revolution.

Without a doubt, AI is going to revolutionise every industry, making businesses faster and cheaper to operate, creating new opportunities and expected to add approximately £10 trillion to global economic activity by 2030. Processes that are already seen as the norm in the financial services industry, such as fraud detection and stock trading, will continue to be made possible by AI.

This rise in AI applications will bring about a host of new demands for data. It will require complex data processing and a high level of compute to ensure that businesses can welcome AI with functioning arms. Outdated infrastructure is difficult and costly to upgrade to the standard required to facilitate AI operations. Outsourcing providers, on the other hand, build their infrastructure with the focus on interconnection—they are constantly redesigning their infrastructure to evolve with new technologies, so businesses can benefit from a purpose-built environment without having to worry about costly iterative updates to their own infrastructure.

2) Lowered operation costs

As legacy infrastructure gets older, the underlying processes and applications also become more expensive to maintain. It is also true that older systems require an environment that will still cater to the older iteration of operating systems and out-dated hardware.

Alternatively, outsourced provision, such as public cloud or colocation, provides instant update to your infrastructure without major capex output. A cloud-based system will instantly provide a virtual network and new technologies like standardised application programme interfaces (APIs) that bring down the high legacy system operational costs.

3) Scalability

Without a doubt, the needs of enterprises have moved further and wider apart than the original software that was initially set in place. This rolls on to the issue of scalability—if original systems lack the ability to scale, which is true of many systems, companies can’t reach their full potential, and may not keep up with the evolution of their business model. Furthermore, if key partners in a business’ network have upgraded their systems, there becomes a misalignment in systems, which could be to detrimental to the overall bottom line.

Outsourcing to providers allows businesses to focus on their core competencies and offerings. Scaling should be left to someone who can better monitor usage and resources to match demand. This will have a huge advantage over those who have to worry about their own infrastructure failing them at crucial moments.

4) Increased security

The issue with legacy infrastructure is the fact that hackers have had a long time to determine loopholes within its security systems, leaving data in a vulnerable state. Many legacy programmes were built with functionality in mind, and security often takes a backseat.

On the other hand, outsourced providers like data centres are designed to protect against both physical and digital data breaches. Where ensuring old infrastructure can protect data from attacks is incredibly expensive on an individual basis, data centre partners aggregate the cost of security across their customers meaning your increased security comes at a lower cost.

5) Centralised integration platform

Outsourcing infrastructure means that companies benefit from all their data and connections being held in – and connected to – one single place, instead of the multiple different servers and networks that often make up legacy infrastructure.

This will deliver important benefits: quicker on-boarding of new applications, real-time data transaction views, and end-to-end governance. Companies, especially those in trading or stockbroking, benefit from faster and better service for customers and efficient end-to-end data flows.

What can data centres do to help?

To seize the new technological opportunities, such as from the rise in AI, and to ensure that they benefit from these opportunities, companies will need to meet new processing and interconnectivity demands.

This challenge is leading many to look to cloud and data centre partners for the purpose-built infrastructure, rapid low-cost interconnection and simple management that these complex data environments can provide. In the next two years, 48% of large financial services businesses will move their workloads to the cloud wherever possible and just 27% expect their workloads to remain on-premise. Data centres are a simple and secured solution to ensure that you move to the cloud without the great financial cost of implementing it in-house.

More likely than not, companies would not have previously faced this level of exponential technological growth. Data centre providers offer the foundations that help them deal with the growth in data. Through colocation or public cloud, data centre providers deliver cost-efficient, purpose built, secured and maintained infrastructure. Companies across all industries are able to rely on the tailored solutions to ensure that they are supported for the next big technological revolution.

The future is becoming increasingly data-driven and key decision makers need to put infrastructure investment high on their agendas. Whilst there is an initial financial sacrifice, firms can expect to see a healthy return on their investment (ROI) in the long-term.