As we live more and more of our lives online and exchange of digital data becomes more essential to keep businesses running. Digital exchange requires huge computing and networking equipment that resides in a centralized physical location called a data centre.

A data center is a specialized computer room that houses the computing and storage hardware for an organization or business. The core components of a data center include servers that house the power of processing to transform raw data into useful data, and storage devices that store the data on a robotic tape or hard-disk drives. In addition, a data center relies on communication and networking equipment acplc such as switches, routers and endless miles of cables to facilitate the flow of information between servers.

The term « data center » began to be employed in the early 1990s, as IT operations grew and the cost of networking equipment allowed companies to house all their networking equipment in a centralized space. Nowadays, companies can choose to construct their own data centres on their own premises or work with third-party service providers which offer cloud, managed and colocation services. Third-party solutions are typically a more energy-efficient and cost-effective alternative to facilities on premises.

Many of these third-party options also offer more flexibility in terms of policy management. For instance the data center may offer multiple environments for policy management in a single location, allowing IT to limit the workload of data with distinct policies that meet compliance demands across geographies and business units. This can reduce security risks and improve the information governance.