Business-Driven Architect

Brenda Michelson

What does that cheap server really cost?

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Kenneth G. Brill, executive director of the Uptime Institute, has an eye opening piece in Forbes on the full cost to purchase, house and run cheap ($2,500) servers.  In his work, Brill aggregates facility related server costs that are typically dispersed across several budgets:

"Data-center building depreciation is often carried separately from data-center mechanical and electrical equipment. Utility bills often go to a centralized energy function. Site operation costs for technicians, security staff, power and cooling equipment maintenance, property taxes and other costs are often split between facilities and IT budgets. Nowhere is the total picture consolidated."

What Brill found is that "Annual facility costs will exceed the cost of a "cheap" server in two years in the best case scenario, or 14 months in the worst."  In other words, "Spending $2,500 on a server really means spending between $8,300 and $15,400 in facility capital to provide the necessary space for housing the server and powering it."

Other interesting data points:

"--Just the electricity required to provide power and cooling will exceed the cost of the server in six years. Utility bills virtually never go to IT, and often don't go to facilities either, which inhibits conservation."

"--For an organization with 5,000 servers, the industry rule of thumb is that up to 30% are technologically obsolete. This means that up to 1,500 servers can just be unplugged with no negative impact on data-center production. The savings: $12 million to $23 million recovered in data-center facility capacity, $700,000 in annual electric savings and 6,000 annual tons of reduced greenhouse gas emissions. These savings result merely by telling the "kids" to turn off the "lights" when they leave the room."

Brill then continues by asking what this turns the lights of habit could mean for companies and the economy -- not to mention the environment:

"If we did this on a broad national scale, do we really need to be building all the new data centers, or could we defer a large portion of this investment into the future? Our companies and economy would be far better off if that money went into new application development instead of bricks and mortar!"

While $15k might seem like small money, Brill concludes with an example of a $22 million blade investment that didn't account for facilities in the purchase decision:

"One company's IT department decided to invest $22 million in blade servers but forgot to inform facilities. The facility investment required to merely plug-in the blades was an unplanned $54 million. An additional unplanned $30 million was required to run the blades over three years. So what appeared to be a $22 million decision was really an enterprise decision of over $106 million."

I've only provided some excerpts here.  I think this article is a "must-read" not just for managers and senior IT executives, but for all IT professionals making server line-item requests.  How can you help shift investment dollars from facilities to the delivery of business capability?

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Brenda Michelson, Principal of Elemental Links, shares her view on architectural strategies, technology trends, business, and relevance.

Brenda Michelson

Brenda Michelson is the principal of Elemental Links an advisory & consulting practice focused on business-technology capabilities that increase business visibility and responsiveness. Follow Brenda on Twitter.


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