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Data Centers Explained

You may have heard the term “data center” and wondered what it means and even asked yourself, “What does a data center do?” Data centers are centralized locations for storing, processing, and managing large amounts of data, providing businesses with a reliable, scalable, and secure infrastructure for running their mission-critical applications and services.

In this article, we will take a look in more detail at what a data center is, what a data center does, and why it’s important in the modern world of cloud computing, big data, and the growth of the internet.

Table of contents

What services do data centers provide?

Data centers play a vital role in modern businesses, allowing them to manage large amounts of data and offer several services. There are a few areas, particularly, where data centers add value to an organization:

  • Email and file sharing: Data centers enable organizations to store and share large files and documents securely and efficiently. This is useful for remote teams or those operating in multiple locations. By centralizing data storage and providing reliable access, data centers help to ensure that email and file sharing are seamless and efficient.
  • CRM and ERP: Customer relationship management (CRM) and enterprise resource planning (ERP) systems are crucial for managing business operations and customer relationships. Data centers provide a secure and reliable infrastructure for these systems, ensuring that data is always available and accessible. This helps organizations to make better-informed decisions, improve customer satisfaction, and optimize business processes.
  • Machine learning: Machine learning is becoming increasingly important for many organizations, as it provides the ability to analyze vast amounts of data and extract valuable insights. Data centers provide the high-performance computing infrastructure necessary for machine learning, enabling organizations to develop and deploy sophisticated models and algorithms.

Data centers are so vital to the running of many organizations that the locations of the data centers for high-profile companies such as Microsoft are kept secret, to prevent attacks.

The different types of data centers

There are several types of data centers, each designed to meet specific needs and requirements.

Enterprise data centers

These are owned and operated by individual organizations to meet their IT needs. Enterprise data centers are usually large, complex, and highly customized to meet specific business requirements, often around things like security, reliability, and compliance. They are often located in the same geographical place as the organization they support (on-premise).

Managed services data centers

Managed services data centers are owned and operated by third-party service providers who offer managed IT services to businesses. Managed services data centers provide a range of services, including hosting, storage, security, and network management. Organizations lease the infrastructure rather than buy it.

Colocation data centers

These are third-party data centers that provide space, power, cooling, and physical security to multiple organizations. Colocation data centers offer a cost-effective way for organizations to outsource their data center needs while retaining control over their IT infrastructure. This means that the organization is still responsible for the servers, storage, etc.

Edge data centers

These data centers are smaller facilities located closer to end-users or applications that create or consume data. These data centers are designed to provide low latency and high bandwidth connectivity to support real-time applications and services.

Hyperscale data centers

Hyperscale data centers are massive facilities designed to support the computing and storage needs of large-scale applications and services. They’re typically owned and operated by large technology companies, such as Google, Microsoft, and Amazon.

Cloud data centers

Cloud data centers are owned and operated by cloud service providers, such as Amazon Web Services (AWS), Microsoft Azure, or Google Cloud (GC). Cloud data centers provide cloud computing resources, such as virtual machines, storage, and networking, to businesses and individuals on a pay-as-you-go basis.

The major core components of a data center

Every data center, regardless of the type (as described above) will have some common core components that help it function.

  • Servers: These are the primary computing devices that store and process data.
  • Storage systems: These devices provide the space needed to store data, including hard drives, solid-state drives (SSDs), and storage area networks (SANs).
  • Networking equipment: This includes routers, switches, racks the servers are stored in, network cabling, and other hardware that facilitates the communication between servers, storage systems, and end-users.
  • Cooling systems: Data centers generate a lot of heat due to a large number of computing devices. Cooling systems are used to maintain the optimal temperature range for the equipment to function properly.
  • Power systems: Data centers require a significant amount of power to operate, so power distribution units, backup generators, and uninterruptible power supply (UPS) systems are used to ensure a continuous and reliable power supply.
  • Fire suppression systems: To protect against the risk of fire, data centers are equipped with fire suppression systems that can detect and extinguish fires quickly and efficiently.
  • Physical security systems: Data centers store sensitive and valuable data, so physical security systems such as surveillance cameras, access control systems, and security personnel are used to ensure the protection of the facility and its contents.

Data center infrastructure

Data centers are designed with a tiered approach that reflects the level of availability and redundancy built into the infrastructure. The tiered approach ranges from Tier 1 to Tier 4, with each tier representing an increasing level of availability and redundancy. These levels are defined by the Uptime Institute.

  • Tier 1: A basic data center with a single path for power and cooling distribution. This tier provides 99.671% availability and is typically used for small businesses or non-critical applications.
  • Tier 2: A redundant data center with multiple paths for power and cooling distribution. This tier provides 99.741% availability and is typically used for small- to medium-sized businesses or non-critical applications.
  • Tier 3: A concurrently maintainable data center with multiple paths for power and cooling distribution and at least N+1 redundancy for critical components. This tier provides 99.982% availability and is typically used for medium to large-sized businesses or critical applications.
  • Tier 4: A fault-tolerant data center with multiple paths for power and cooling distribution and 2N+1 redundancy for critical components. This tier provides 99.995% availability and is typically used for large-sized businesses or mission-critical applications.

The support infrastructure of a data center includes equipment that contributes to its security, availability, and reliability. Some of the key components of the support infrastructure include:

  • Uninterruptible Power Supply (UPS): A device that provides backup power in the event of a power outage. A UPS ensures that critical systems remain operational during an outage and can also protect against power surges and spikes.
  • Computer Room Air Conditioner (CRAC): A device that maintains a controlled environment within the data center by removing heat generated by the computer equipment. CRAC units are designed to provide cooling in a precise and efficient manner.
  • Heating, Ventilation, and Air Conditioning (HVAC) systems: These systems provide the infrastructure for cooling and heating the data center. The HVAC system includes ducts, filters, and fans to ensure that the air temperature and quality within the data center are optimal for the equipment. Security systems: Data centers are high-security facilities that require strict access controls to protect against unauthorized entry. Security systems may include biometric scanners, security cameras, and other advanced access control measures.

Why invest in data centers

Investing in data centers is a strategic move for businesses looking to stay competitive and efficient in the digital age. In this section, we will take a look at the reasons for investing in both cloud and on-premises data centers, including some reasons common to both.

  • Security: Data centers provide physical and logical security measures to protect data and applications from cyberattacks and other security threats. Data centers implement multiple layers of security, including firewalls, intrusion detection and prevention systems, and encryption, to ensure the confidentiality, integrity, and availability of data.
  • Efficiency: Data centers are designed to be highly efficient, with optimized power and cooling systems, server virtualization, and energy-efficient hardware. This reduces energy consumption, lowers operating costs, and minimizes the carbon footprint of the data center.
  • Competitive advantage: Investing in data centers can help organizations stay ahead of the competition by providing faster and more reliable access to data and applications, enabling them to make better-informed decisions, improve customer satisfaction, and optimize business processes.

Why invest in cloud data centers

Cloud computing is becoming the go-to for modern applications and data needs. For this reason, many organizations invest in data centers hosted in the cloud.

  • Scalability: Cloud data centers offer a scalable infrastructure that can grow or shrink as business needs change. This means that organizations can quickly respond to changes in demand and adjust their IT infrastructure accordingly.
  • Reliability: Cloud data centers provide redundancy and failover mechanisms to ensure the availability and reliability of digital services. This reduces the risk of downtime, data loss, and other disruptions that can negatively impact business operations and customer satisfaction.
  • Cost-effectiveness: Cloud data centers can be more cost-effective than building and maintaining an in-house data center, especially for smaller organizations. By outsourcing their IT infrastructure to a data center provider, businesses can reduce capital expenses, such as server and storage hardware, and operating expenses, such as power and cooling.

Why invest in on-premises data centers

  • Control: By having an on-premises data center, businesses have complete control over their hardware and infrastructure, allowing them to tailor their setup to their specific needs and requirements. This can be especially important for businesses that have strict security or compliance regulations.
  • Performance: In some cases, on-premises data centers can provide faster and more reliable performance than cloud-based solutions. This is especially true for businesses that need to process large amounts of data or have real-time processing needs.
  • Cost: Depending on the scale of the business and its needs, an on-premises data center can be more cost-effective than relying on cloud services. This is particularly true for businesses that have predictable workloads and do not need to scale up or down frequently. However, it's worth noting that on-premises data centers require significant upfront capital investment and ongoing maintenance costs, which can be a barrier for smaller businesses or those without specialized IT staff.
  • Legacy Systems: Some businesses may have legacy systems or applications that are not easily migrated to the cloud. In these cases, an on-premises data center may be the best option.

In addition to these benefits, investing in data centers also enables businesses to take advantage of emerging technologies, such as artificial intelligence, big data analytics, and the Internet of Things (IoT). Data centers provide the high-performance computing infrastructure necessary for these technologies, enabling businesses to gain insights and make predictions that can drive innovation and growth.


In this article, you have learned more about what a data center does, the different types, what the core components are, and why it’s worth investing in them.

Data centers underpin many organizations and their applications, providing essential services. In fact, MongoDB makes use of data centers to host the infrastructure required for your Atlas clusters.


The following are a selection of frequently asked questions about data centers: