24 May 2013 | Gareth Willmer

Ian McVey, director of enterprise and systems integrator segment at Interxion, believes a well-crafted data centre strategy could help carriers and other players seize on the growing potential for big data. Gareth Willmer asks how.


Ian McVey, director, enterprise and systems integrator segment, Interxion  

Ian McVey, director, enterprise and systems integrator segment at Interxion, takes personal inspiration from the impact technology can have on both corporate and consumer life. In fact, he reflects on technology’s rapid evolution by using one of the most personal experiences anyone can have.

“My first son was born in 2008,” says McVey. “We took cameras in and then got home and emailed the photos. By 2012, when my second son was born, we had smartphones and uploaded direct to Facebook… It’s a stark contrast of how quickly technology develops and how it can impact on our lives.”

This type of experience, which would doubtless strike a chord with a vast number of new parents worldwide, is also indicative of the proliferation of data that has taken place in recent years and led to growing talk of the opportunity for ‘big data’.

As McVey points out, Facebook’s daily upload volume of 250 million photos would be 80 Eiffel Towers high if stacked.

McVey has been with Interxion for just over 15 months, but has more than 15 years of industry experience. This length of service means he has viewed the industry from multiple different angles and gives him good insight into the burgeoning world of big data, in which the immense volumes of information whizzing about are ripe for analysis to help improve internal processes and ultimately customer experience.

“With big data there’s a triumvirate of business, IT and networks that has to be brought together,” says McVey. Having worked as a strategy consultant at LEK Consulting as well as held various sales and marketing roles at companies such as Microsoft and Cable & Wireless, McVey appears well positioned to understand how these business areas can knit together in unison.

During this time, McVey has seen firsthand how software can provide a strategic insight, while working in outsourcing has also given him an understanding of how huge outsourcing contracts can be managed and the commercial aspects of corporate versus consumer IT. “IT is undoubtedly a strategic enabler for a company,” he says. “While IT assets are commoditising, it is the configuration of those assets that gives companies their strategic edge.”

In an article on the use of data centres to exploit the opportunity for big data, McVey writes how it is nothing out of the ordinary for a company to generate a staggering 2.5 quintillion bytes of data in a day: “Pushing the amount of data that must be processed and managed to unimaginable levels,” he says.

He writes: “Because of the requirements for power and low-latency connections that such data growth entails, many companies have become more inclined to outsource their big data needs to co-location data facilities. In turn, this has created a huge demand for co-location space as additional processing grounds for big data.”

It seems then that if carriers can find an effective data centre strategy to harness this huge flood of information at their fingertips, they could tap into major new revenue streams. “I think we’re at the tipping point: current computational costs are allowing a large amount of data to be crunched,” says McVey.

Carrier choices

McVey says carriers need to think about the implications of where they build data centres to make the most of the opportunity for big data, with their choices ultimately serving either to help or impede them in their progress as they roll out cloud services. “Data centres need to rapidly grow in a commercial and agile way to help enterprises,” he says.

“As you build out Infrastructure-as-a-Service or big data solutions, be very careful where you’re building it out. At the end of the day, companies that correctly locate their solutions will have a strategic advantage over those that don’t, both on the carrier and on the seller side.”

He says a successful strategy will take a blend of carriers’ own well-placed data centres and their use of third-party carrier-neutral providers like Interxion. “If we’re to be humble about it, we couldn’t service the demand for every data centre requirement globally,” says McVey.

Rather, he emphasises that carriers have an opportunity to use Interxion for partnering to connect up their enterprise customers into its sites, with the company’s 33 European multi-tenant data centres catering for an array of different clients in different industries. He also points out that purchasing bundles of power means co-location data centres can often offer power at a lower cost than a private data centre.

McVey says that “for big data, we’re a retail mall. You can come into our facility and cross-connect to all other retailers”.

These cross-connects could prove key to an effective big data strategy, with the ability to reduce latency between companies in the same data centre and connect communities in different sectors to improve analysis of big data. In his article, McVey gives the example of a mobile provider cross-connecting its database with an advertiser’s data on customer demographics.

Interxion has followed a strategy of creating different communities of interest in its data centres, with McVey outlining how the company started by connecting carriers together and has applied the same principle to other sectors, starting with financial services, then digital media and now cloud services.

“This provides a richer community to connect into,” he says. “By creating the ‘community of interest’ for particular big data solutions, this creates value by definition for carriers to connect into for their enterprise customers.”

In terms of carriers needing to optimally locate data centres for big data, McVey refers to an example of a carrier building a data centre on the Isle of Man and wanting to connect to another in London to analyse data in Reading. “What are the implications of connecting all this together?” he asks. “The network latency and time for computing analysis could mean the data is delivered too late.” Choices like this, he says, could be key.

McVey says that “it’s slightly early days for building hybrid cloud and big data infrastructure solutions,” but he expects big data to have a “massive impact” in the long run and drive an increased demand for international bandwidth significantly beyond that currently predicted by some key industry forecasts.

Carrier moves and outlook

Ultimately, says McVey, carriers stand to gain from more business diversity and significant revenues if they can harness big data, as well as overcome market challenges: “They are suffering a lot from over-the-top services and the carrier business model is struggling to get a return on capital investment.”

McVey also points to the fact that carriers are introducing cloud services and need to assess the business case in that area: “It’s similar to any carrier outsourcing service – how do we ensure a competitive infrastructure?”

If carriers can gain a grip on this area, big data could make a significant contribution as a fresh business service. Telefónica has noted exactly that opportunity, with McVey citing the company as a carrier at the forefront of developing big data as a service through the launch of its Telefonica Dynamic Insights business unit in October 2012.

Telefónica’s new unit aims to provide global companies and public sector organisations with analytical insights through the use of data sets, including machine-to-machine (M2M) and mobile network data.

Its first product, Smart Steps, is geared towards providing retailers, public bodies and event organisers with anonymised, aggregated mobile network data to show trends on footfall by parameters including time, gender and age.

Deutsche Telekom for one has also said it plans to target the link between M2M initiatives and big data as a way to seek new revenue streams, especially by using M2M to analyse big data trends.

Strategic advantage of cloud

Carriers could attempt to further benefit by making their enterprise customers more aware of the opportunity for big data and stopping them from, as McVey terms it, viewing the network as a “poor relation” to their business strategy.

He points to an Interxion study which indicates that only a quarter of businesses have explored and made a successful business case for big data.

“There is a lack of understanding coming from the corporates. They are, quite rightly, thinking about the business problems but not also looking at the role of the network in their business solutions.”

In addition, McVey says carriers have “a very strategic advantage with the cloud in that they can offer an end-to-end SLA”.

He says that having to sort out SLAs with different providers can be a “big prohibitor” to enterprises today and make things more complicated. “The carrier has a very good opportunity here,” he says.

One concern that inevitably rears its head with any reference to terms like “big data” and the mining of huge data sets to uncover trends in areas like customer behaviour and financial transactions is that of data privacy. McVey agrees this is a key issue that relates not only to data sovereignty in terms of keeping data within a country, but also to data privacy in terms of not using someone’s personal data under data protection.

He stresses that regulations in this area mean that carriers and service providers offering cloud services must again think carefully about where to locate their data.

“Interxion facilitates this by being present in 33 data centres in 13 cities [and] 11 countries across Europe. So partnering with Interxion means service providers and carriers can build a cloud infrastructure that complies with these regulatory requirements,” he adds.

McVey concludes that for the carriers, big data could represent a significant revenue stream that would provide a contribution to their fixed cost assets, ie. the network, and ultimately protect their margins and profitability.