Increasingly, data centers are no longer tied to a physical location, but instead offer flexible and scalable infrastructure that can be virtualized, growing and adapting with your business needs. Welcome to the world of the virtual data center.

A virtual data center is a collection of virtualized computing resources, such as servers, storage, and networking components, that are deployed and managed as a single entity. It provides the same functionality as a physical data center but with added benefits by using virtualization technology.

By leveraging the power of virtualization technology, businesses can enjoy numerous benefits such as cost savings, increased productivity, and enhanced security measures. Let’s dive into the realm of virtual data centers and explore how they can transform the way your organization manages its IT resources.

Understanding the Virtual Data Center

Virtual data centers use virtualization technology to create an abstract representation of a physical data center, offering a centralized framework for delivering IT resources as a service.

Virtual Data Center with Multiple Servers and Cloud Computing Resources

Benefits of virtual data centers include:

  • Renting virtual infrastructure from cloud service providers
  • Enabling remote employees to access corporate resources securely
  • Ensuring compliance with corporate policies
  • Providing a flexible and efficient IT infrastructure solution

With the ability to work in various cloud computing deployment models like:

Virtual data centers are revolutionizing data center architectures and maximizing the potential of cloud computing, processing power, and data storage.

Virtualization Technology

Virtualization is the foundation of virtual data centers, enabling the creation of multiple simulated environments or dedicated resources from a single physical hardware system. This technology is employed in virtual servers, also known as software-defined data centers (SDDCs), which are created from traditional, physical servers.

Virtualization Technology Glows with Neon Cubes Hovering Over Dark Circuit Board Future

Hypervisors play a key role in virtualized data center solutions by facilitating the creation and management of virtual machines (VMs), allowing resources such as CPU, memory, and storage to be dynamically allocated among existing virtual machines or new ones.

The distinction between virtualization and the cloud is crucial to understanding how a virtual data center maximizes their benefits. While virtualization enables the formation of multiple simulated environments or dedicated resources from a single physical hardware system, the cloud is a platform that provides access to a pool of scalable resources over a network connection.

By efficiently allocating processing power among multiple virtual machines, virtualization can help organizations make the most of their IT resources and optimize their data centers.

Components of a Virtual Data Center

A virtual data center (VDC) primarily consists of:

Virtual Data Center Components Machines VMs Networking Storage Hypervisor Management Orchestration Side-by-Side
  • Virtual Machines (VMs): VMs are software-based emulations of physical computers that run on the hypervisor. Each VM has its own operating system, applications, and virtual hardware resources like CPU and memory (RAM)
  • Virtual Networking: This enables communication between VMs within the VDC and with external networks. It includes virtual switches, routers, and load balancers that are software-defined
  • Virtual Storage: This provides a centralized, software-defined storage pool for VMs. It allows for flexible allocation of storage resources and enables features like snapshotting, replication, and data deduplication
  • Hypervisor: This is the foundation of a VDC. It is a software layer that allows multiple VMs to run on a single physical server, enabling efficient utilization of hardware resources
  • Management and Orchestration: These tools are used to control and automate the provisioning, configuration, and monitoring of the VDC components. These tools help in managing the lifecycle of VMs, optimizing resource utilization, and ensuring high availability
  • Security: These components in a VDC include virtual firewalls, intrusion detection and prevention systems (IDPS), and access control mechanisms. These components help in protecting the VDC and its workloads from unauthorized access and cyber threats

Server virtualization is a key component of the compute aspect, allowing for the efficient allocation of processing power among multiple virtual machines (VMs). Compute virtualization utilizes a hypervisor to generate multiple, separate VMs, while network virtualization abstracts network resources from their physical hardware, enabling IT administrators to easily migrate workloads across data centers without being affected by the physical hardware.

Storage virtualization is a vital component which helps in pooling multiple storage resources. This eliminates the necessity for using siloed storage systems. It also allows IT administrators to dynamically allocate capacity to each application on-demand, thereby improving flexibility and scalability.

By combining these components, a virtual data center can provide organizations with a powerful, flexible, and efficient IT infrastructure solution.

Advantages and Benefits of Virtual Data Centers

Adopting a virtual data center can bring numerous advantages, including resource optimization, agility and scalability, and increased security. These benefits not only lead to cost savings, but also enable businesses to adapt quickly to changing market conditions and scale their IT infrastructure as needed.

Server Facility with Optimized Resources and Scalability

Below is further detail on the advantages of adopting a virtualized data center:

1. Resource Optimization

One significant advantage of virtual data centers is resource optimization, which enables cost-efficient allocation of IT resources and reduced management and maintenance costs. By allowing one resource to emulate multiple resources, virtualization technology helps organizations maximize the use of their IT infrastructure.

Virtualized data center services offer businesses the following benefits:

  • Cost-effective solution
  • Flexibility to pay-as-you-go, based on resource usage
  • Scalability to easily add or remove resources as needed
  • Improved disaster recovery capabilities
  • Enhanced security measures to protect data

These benefits can have a direct impact on a business’ bottom line, as they enable more accurate forecasting of operational costs and effective financial resource management. With the ability to rent virtualized infrastructure from cloud service providers instead of purchasing and maintaining physical data centers, organizations can enjoy a more cost-effective and capital efficient IT infrastructure solution.

2. Agility and Scalability

Virtual data centers offer businesses increased agility and scalability, allowing them to:

  • Rapidly adjust to fluctuating market conditions
  • Expand their IT services and infrastructure as required
  • Quickly respond to new market opportunities and changing customer demands
  • Boost their capacity to scale in accordance with the demands of a growing business
  • Procure additional IT services and resources in a matter of minutes when responding to changing business needs or new opportunities
Agility alongside Scalability with Stacks Increasing in Height and Arrows Indicating Upward Growth in Scale

IT administrators can further expedite the process of setting up virtual servers and desktops by utilizing pre-configured images or master templates, or by cloning an existing virtual machine. This allows virtual servers and desktops to be set up in minutes, providing businesses with agility and scalability.

3. Enhanced Security Measures

Virtual data centers not only offer cost and agility benefits, but also provide enhanced security measures an services. These measures include encapsulated data traffic (such as the VXLAN protocol), simplified governance, and centralized policy maintenance. By abstracting data traffic and network resources from their physical hardware, virtualized data centers can provide an additional layer of security, protecting sensitive information from potential threats.

Moreover, having a strong security posture across all virtualized assets is essential to ensure the protection of business information assets and maintain compliance with industry regulations. By implementing cloud-native security solutions and maintaining agile security measures that can be mapped in real-time to virtual infrastructure management tools, organizations can effectively safeguard their virtual assets and ensure the ongoing security and compliance of their IT resources.

Implementing a Virtualized Data Center: Best Practices

Implementing a virtual data center requires careful planning, design, and ongoing monitoring to ensure a seamless integration with existing IT infrastructure and the maximization of its benefits.

Virtualized Data Center with Planning and Design Tools

Let’s take a closer look at the best practices for implementing a virtual data center, from planning and design to choosing the right tools and platforms, and ongoing monitoring and management.

Planning and Design

The planning and design process for implementing a virtual data center involves aligning business and technology goals, obtaining buy-in from stakeholders, and creating a roadmap for implementation. This ensures that the virtualized data center aligns with the organization’s overall objectives and has the support of key stakeholders, setting the stage for a successful implementation.

Creating a roadmap for implementation is essential and it should outline the steps required to implement the virtual facility and its services, including:

  • Selecting appropriate tools and platforms
  • Integrating with existing systems and processes
  • Monitoring and managing the virtual environment on an ongoing basis

Choosing the Right Tools and Platforms

Selecting the right tools and platforms for a virtual data center is critical to ensure its success. Some of the most widely-used virtualized data center platforms include VMware vSphere, Microsoft Hyper-V, Citrix Hypervisor, Oracle VM VirtualBox, and Red Hat Virtualization (RHV). These platforms offer unified management of virtual machines, networks, and storage, as well as self-service portals for users to access their virtual resources.

When implementing a virtualized data center, it’s also important to consider the deployment options that best suit your organization’s needs, including on-premise, cloud-based, and hybrid deployments. Each option has its own advantages and drawbacks, so carefully evaluating your organization’s specific requirements and constraints will help you choose the most suitable deployment option.

Monitoring and Management

Ongoing monitoring and management of a virtual data center are crucial to ensure its smooth operation, performance, and security. Utilizing centralized tools and automation can simplify the management of virtual environments, reducing costs and increasing agility. Moreover, monitoring and managing system data can help detect and address any potential issues, such as system outages or data loss, ensuring business continuity.

Besides performance and reliability, ensuring proper security measures are employed is of paramount importance in a virtual data center. Some key security measures to consider include:

  • Implementing controls to safeguard the integrity of business information assets
  • Applying technology and physical measures to secure and protect the data center’s assets and resources
  • Maintaining continuous vigilance through monitoring and surveillance systems

Real-World Examples of Virtual Data Center Success

Real-world examples of virtual data center success can provide valuable insights into the benefits of adopting this technology across various industries and use cases. Let’s explore two case studies that showcase the advantages of implementing virtualized data centers and how they have transformed the way these organizations manage their IT resources.

Virtualized Data Center with Successful Real-World Examples Case Study

Case Study on J.P. Morgan – Efficiency, Scalability, Cost Reduction

J.P. Morgan, a leading global financial services company, was able to enhance efficiency, improve scalability, reduce costs, and strategically align with its modernization goals by implementing a virtual data center.

By outsourcing the maintenance and management of the physical data center to a cloud service provider, the company’s IT administrators were able to focus on more strategic tasks, leading to increased productivity. The virtualized data center also provided a more cost-effective solution, as the company could rent virtual infrastructure from the cloud provider instead of purchasing and maintaining physical data centers.

More specifically, the virtual data center offered the following benefits:

  • Efficiency: Migrating 60% of its in-scope applications to virtual data centers has led to a 30% increase in efficiency for J.P. Morgan, reducing its hardware asset count by 16,000
  • Integration of Cloud: Virtual data centers and a multi-vendor public cloud strategy have become pivotal in J.P. Morgan’s IT architecture. Of the company’s total IT infrastructure, 38% now resides in the cloud, showing alignment between cloud integration and virtualized data centers
  • Legacy to Virtual Migration: J.P. Morgan’s strategic shift to virtual data centers is evident in the ongoing migration. On track to move approximately 95% of its applications out of legacy facilities by year-end 2024, the company’s push towards virtualized data centers is focused
  • Markets Regulatory Reporting Platform: This platform is J.P. Morgan’s public cloud-hosted data warehouse that leverages virtual data centers, allowing scalability to 2.5 billion trades per day. This migration has resulted in monthly running costs decreasing by over 50%

J.P. Morgan’s commitment to virtual data centers is at the core of its modernization strategy. From efficiency gains to cost reductions, the emphasis on virtualized data centers has positioned the company for future innovation and growth.

Case Study on Carrier Global – Global Scalability and Cost Reduction

Carrier Global specializes in intelligent climate and energy solutions, offering a wide range of products and services across HVAC, refrigeration, fire safety, security, and building automation technologies.

Carrier Global Supply Chain Manufacturers Global Transportation by Truck Ship Plane Partnership with AWS
Source: Carrier Global.

The company embarked on a mission to transform its IT infrastructure, aiming to migrate 4,000 workloads to virtual data centers over 36 months. Its strategy involved leveraging virtual data centers and cloud migration services from Amazon Web Services (AWS). Throughout the process, Carrier:

  • Exited 1,300 servers supporting 350 applications and decommissioned 370 servers
  • Shut down 14 traditional data centers
  • Standardized its network across 675 global facilities

The virtual data center led to the following benefits:

  • Global Scalability: 70% of internal workloads moved to virtual data centers in eight global regions
  • Cost Efficiency: Achieved an annualized cost reduction of $2.4 million
  • Network Transformation: Transitioned from high-cost networks to software-defined networks, enhancing accessibility and security

Carrier’s adoption of virtual data centers marked a significant transformation in their approach to IT management. By consolidating data centers and embracing cloud technology (including collaboration with AWS), they successfully executed a strategy that led to cost savings and enhanced scalability.

Challenges in Virtualized Data Centers

While virtual data centers offer numerous advantages, adopting this technology also comes with challenges, such as ensuring proper security, managing complexity, and ensuring seamless integration with existing IT infrastructure.

Server Facility with Proper Security Measures

Let’s explore these challenges in more detail and discuss potential solutions to overcome them.

Ensuring Proper Security

Ensuring proper security in a virtual data center is of paramount importance, as it protects sensitive business information and maintains compliance with industry regulations. Implementing cloud-native security solutions and maintaining agile security measures that can be mapped in real-time to virtual infrastructure management tools are essential for safeguarding the virtualized data center.

In addition to securing the virtual data center, it’s also crucial to maintain a strong security posture across all virtualized assets and services. This includes:

  • Implementing controls to safeguard the integrity of business information assets
  • Applying technology and physical measures to secure and protect the data center’s assets and resources
  • Maintaining continuous vigilance through monitoring and surveillance systems

Managing Complexity

Managing complexity in a virtual data center can be challenging, as it involves dealing with various difficulties that arise when operating a virtualized infrastructure – such as scalability, high availability, and diverse workload management. However, by simplifying the management of virtual environments through centralized tools and automation, organizations can reduce costs, increase agility, and optimize the performance of their virtualized facilities.

Seamless Infrastructure Integration

Seamless integration of a virtual data center with existing IT infrastructure is essential for a successful implementation. This requires careful planning and design, selecting appropriate tools and platforms, and consistently monitoring and managing the virtual environment.

In addition to planning and design, organizations should also consider the deployment options that best suit their needs, including on-premise, cloud-based, and hybrid deployments. By evaluating their specific requirements and constraints, organizations can choose the most suitable deployment option and ensure a smooth and seamless integration of their virtualized data center with existing IT infrastructure.

Frequently Asked Questions

What is a Virtual Data Center (VDC)?

A virtual data center (VDC) is a pool of cloud-based infrastructure resources, such as computing, storage, and networking. These resources are pooled together and presented to users as a single, unified resource. It eliminates the need for an on-premise data center while providing the capability to deploy additional resources as and when needed.

Virtual Data Center VDC with Servers Standing in a Glow of Neon Lights on a Cybernetic Digital Floor

What is a Traditional Data Center vs Virtual Data Center?

A traditional data center utilizes a physical location where computer systems and associated IT components store and process data, whereas a virtual data center utilizes cloud-based resources instead and is not confined to a specific geographical location. Virtualized facilities are software-defined, requiring less equipment, power, cooling, and space than physical data centers, and also have the ability to quickly scale into either a public or private cloud when more resources are needed. This makes them more cost-effective and efficient than physical data centers.

Is the Cloud a Virtual Data Center?

Yes, the cloud is a virtual data center. It provides the same capabilities as a traditional data center, but using a collection of remote servers that are hosted and maintained by a cloud service provider like Amazon Web Services (AWS), Microsoft Azure, or Google Cloud. This enables an organization to quickly deploy additional infrastructure resources as needed without having to purchase, configure, and maintain physical IT hardware. Cloud computing offers many advantages over traditional data centers, including scalability, cost savings, and increased flexibility.

What are the Reasons and Benefits to Run Virtual Datacenters?

Running virtual datacenters reduces the need for physical hardware, simplifies maintenance processes, and offers benefits such as cost savings, scalability and improved resource utilization. Additionally, a virtual datacenter can offer faster application deployment times, increased security, and improved disaster recovery capabilities.

What Resources and Infrastructure Do Virtual Datacenters Provide?

Virtual datacenters provide a pool of computing resources and infrastructure, including virtual machines (VMs) or virtual servers, storage, and networking capabilities. These resources can be easily provisioned, scaled, and managed through a centralized software platform, allowing organizations to build and operate their IT environments and virtual datacenter in a flexible and cost-effective manner.

Mary Zhang covers Data Centers for Dgtl Infra, including Equinix (NASDAQ: EQIX), Digital Realty (NYSE: DLR), CyrusOne, CoreSite Realty, QTS Realty, Switch Inc, Iron Mountain (NYSE: IRM), Cyxtera (NASDAQ: CYXT), and many more. Within Data Centers, Mary focuses on the sub-sectors of hyperscale, enterprise / colocation, cloud service providers, and edge computing. Mary has over 5 years of experience in research and writing for Data Centers.


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