Haas: The Driving Force in IT Procurement

Mark Twain famously said, “The report of my death has been grossly exaggerated.” The same quote could apply to enterprise data centers.

For years, IT industry analysts have been reporting the demise of onsite, corporate-owned data centers, predicting that organizations would move all of their IT infrastructure to the cloud. That simply hasn’t panned out. While organizations have migrated many applications and workloads to the cloud, some remain onsite due to performance, security, or privacy concerns. 

What’s more, many organizations are taking a hard look at their ever-increasing cloud budgets compared to falling prices for IT hardware, and bringing workloads back onsite. In a recent IDC survey, 71 percent of respondents said they planned to move some or all of their public cloud workloads back into private IT environments over the next 24 months. In its 2023 Technology Spending Intentions research report, Enterprise Strategy Group (ESG) finds that 42 percent of organizations plan to expand their existing on-premises data center footprint over the next five years.

The Hardware-as-a-Service Model

That’s not to say that organizations are abandoning the opex benefits of the cloud. ESG’s research found that 35 percent of organizations plan to transition to a consumption-based, Hardware-as-a-Service model for purchasing data center infrastructure. 

With Hardware-as-a-Service, organizations pay a set monthly fee for servers, storage systems, networking gear, and other equipment that is installed onsite. Unlike a traditional lease, the Hardware-as-a-Service model bases pricing on the number of users or a committed amount of capacity. Most programs include pre-provisioned buffer capacity to support future growth.

Hardware-as-a-Service offers many of the benefits of the cloud, such as conserving capital and aligning technology investments with business outcomes. Organizations can try new solutions with less risk and accelerate IT initiatives by eliminating long capital approval processes. They are also freed from forecasting their IT requirements for the next three to five years and paying upfront for that much capacity. IT costs are tied to actual usage.

Greater Agility, Simplified Management

Like the cloud, Hardware-as-a-Service allows for greater agility. Organizations can scale up capacity to support business growth or scale down to reduce costs. Short-term contracts can even be used to support specific projects or fill resource gaps while waiting for equipment to be purchased. Some Hardware-as-a-Service subscriptions allow customers to customize a solution with equipment and software from multiple vendors.

Best-in-class solutions also incorporate all the services needed to implement and manage the solution long-term. The fully managed model helps organizations to control costs, reduce operational overhead and fill IT skills gaps.

Because of these benefits, Think Market Intelligence expects the Hardware-as-a-Service market to see a compound annual growth rate (CAGR) of 11.18 percent through 2027. The Network-as-a-Service category is expected to grow twice as fast — Emergen Research forecasts a 22.4 percent CAGR through 2030.

ESS by Rahi

Rahi’s Elevate Subscription Services (ESS) encompass wired and wireless networking, security, audio/visual, and collaboration tools in a turnkey Hardware-as-a-Service solution. It includes professional configuration and implementation by Rahi engineers to accelerate time-to-value. Additionally, a full suite of managed services is delivered through Rahi’s Network Operations Center. Solutions from well-known industry leaders are available within the ESS solution.

While many vendors require a three-year commitment for subscription-based procurement, ESS is built on a one-year framework that gives customers greater flexibility. It is proven to reduce costs by an average of 30 percent annually and increase IT efficiencies by 25 percent.

Many organizations are expanding their onsite data center footprint, but are looking to transition to a more flexible, opex model for IT procurement. Contact us to learn how ESS delivers all the benefits of Hardware-as-a-Service backed by Rahi’s experts.