What Enterprise Leaders Need to Know About the Hidden Economics of Exabyte Storage
Your company could be overpaying for storage—not because you bought the wrong drives or chose the wrong vendor, but because the true economics of enterprise storage remain largely hidden from view.
As someone who manages over 300,000 hard drives holding three exabytes of customer data, I will share some of the hidden economics of exabyte storage that I have uncovered.
Bigger Isn’t Necessarily Better
As a company’s storage needs grow, you might think that drive sizes would also need to grow. Although it might seem that a larger drive makes the most economic sense, this isn’t always the case. While we’ve recently welcomed 20TB drives to our data centers, we deliberately maintain fleets of smaller capacity drives for many workloads.
Hard drives can only perform a set number of input/output operations per second (IOPS). As the size of drives increases, the more these IOPS become a contentious resource. This creates what I call the “triangle of tension” between storage capacity, reading performance, and writing speed.
You can store more data on a 20TB drive, but you can only read and write as fast as that one drive allows. Meanwhile, five 4TB drives offer the same capacity with five times the potential IOPS through concurrency.
This IOPS limitation can quickly become the dominant economic factor for businesses with real-time access requirements, far outweighing the apparent cost savings of higher-density drives.
Rebuild Costs Beyond Hardware Replacement
When hard drives fail, the cost of replacing the drive can go far beyond just replacing the hardware. For larger drives, the rebuild process can take hours and even days, thus increasing costs that rarely are taken into account when initially planning costs.
Due to the time it takes to rebuild, this hidden cost presents as reduced productivity and customer satisfaction rather than simply a line item on your storage budget. In addition, longer rebuild times create an extended window of vulnerability to additional failures. If the storage system is already under heavy use, this only increases the risk of failure.
To best protect data and avoid loss, I recommend implementing the 3-2-1 backup strategy. In this strategy, three copies of the data are kept to best protect against any sort of failures. Two of the copies are located on different types of media and the last copy is kept at an off-site location. This strategy best prepares enterprises for any drive failure risk, thus allowing businesses to save money in the event that one of the drives does fail.
How Egress Costs Are the Silent Killer
The most overlooked aspect of enterprise storage economics is what happens when you need to move your data. According to a Gartner analysis, egress costs can silently consume 10-15% of cloud bills, but I’ve even seen instances where it reaches 40%. For a media company with 22 million customers, simply changing their storage strategy saved $800,000 annually in egress fees alone.
These mobility costs don’t appear in your initial capacity planning but can quickly become one of your most significant operational expenses. The real value of your data isn’t just in storing it but in using it when and where you need it. Many enterprises optimize for the former while completely neglecting the latter.
For organizations building multi-cloud strategies, this often-overlooked economic factor can render an otherwise sound architecture financially unsustainable at scale. What appears as a minor line item in your initial planning becomes a significant budget constraint as your data volumes grow.
Navigating the Evolving Global Regulations
As data sovereignty requirements have evolved to a global mandate, it is vital for enterprises to stay on top of these changes. The United Nations Trade and Development reported that 71% of countries now have data protection legislation.
These regulatory requirements create a hidden economic burden that’s rarely factored into storage strategy. The penalties for non-compliance can be existential—Meta’s $1.3 billion fine for EU privacy violations illustrates the scale of risk. For enterprise leaders, this requires incorporating geographic dispersion costs into your storage economics from day one.
A Guidebook for Enterprise Storage Leaders: 3 Steps You Can Take Today
As a leader for an enterprise with data storage needs, I’ve shared a few changes you can make today to transform your storage economics.
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Profile before purchasing: Extensively document your actual workload patterns—IOPS requirements, read/write ratios, and access frequencies—before making major storage investments.
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Calculate your true data mobility costs: Most enterprises dramatically underestimate how often they’ll need to move data between systems. Map your data workflows end-to-end and identify potential movement patterns before selecting storage architectures or vendors.
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Build for geographic flexibility: Classify your data as low, medium, or high sensitivity, then map these classifications to geographic and architectural requirements. This approach not only prepares you for current regulations but also creates the flexibility to adapt as requirements inevitably evolve.
The enterprise storage landscape has fundamentally changed. Today’s enterprises need infrastructure that can accommodate workloads that didn’t exist five years ago while complying with regulations that didn’t exist three years ago.
Storage is no longer just an infrastructure cost—it’s a strategic asset that can either enable or constrain your organization’s future. The most successful enterprises are those that look beyond the spec sheet economics to understand the hidden factors that actually determine their total cost of ownership.
Don’t wait until you’re trapped in a poor architecture to reassess your storage economics—the time for action is now.
