data center decisions: build versus buy

Data Center DecisionsData Center Decisions“Build versus Buy”“Build versus Buy”

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2010 Excipio Consulting, LLC. All Rights Reserved. This document is proprietary and confidential and may not be duplicated,

redistributed, or displayed to any other party without the expressed written permission of Excipio.

Jeff GilmerSenior Partner612.978.4493

[email protected]

Data Center Review

Agenda

1) Data Centers Todayo Trends

2) How do I “Evaluate” my Data Center?o Operationalo Facilities

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3) “Consolidation”, What does this really mean?

4) How do I know when we are going to run out of Data Center capacity?

5) How Mature are my Data Center Services?

6) Build versus Buy?

Of all respondents 71.3% indicated they are actively engaged in Greening, however only 42.2% have a “formal” Greening Initiative.

Results experienced of implementing Green measures are:

1) Power Efficiency (using less power) 60.8%2) Cooling Efficiency 51.4%3) Water Usage (Reduction) 11.5%

Trend 1: Greening of Data Center Services

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The major obstacles data centers have faced in implementing Greening techniques have been:

1) 39.4% reported not having enough money in their budget2) 29.6% blamed procrastination (discussion no implementation)3) 22.7% lack of senior management commitment4) 20.4% lack of a clear definition of Greening

2009/2010 AFCOM Data Center Trends Survey Results & Analysis

Data Center consolidation has historically been cyclical in this industry. As the economy suffers, more and more companies have traditionally looked to consolidation as a method of saving money.

Of all respondents 62.1% either already are in the process of consolidating one or more data centers, or seriously considering it.

More than half of these respondents (52.1%) plan to relocate their newly consolidated data center to another existing facility, or build an entirely new one.

Trend 2: Data Center Consolidation

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new one.

In determining the location of these new facilities, the number one consideration reported was:

1) The availability of sufficient power (67.1%)2) Susceptibility to local natural disasters (46.6% )3) Proximity to other company facilities (30.3%)4) Availability of sufficient water supply (20.5%)5) Availability of local work force (17.1%)


Data center services are always changing with the adoption of new technologies. The technologies with the highest levels of adoption in today’s data centers are:

1) Virtual Processing (72.9%)2) Web Applications (70.4%)3) Automation (54.8%)4) Cluster Computing (50.0%)5) Cloud Computing (14.9%)

Trend 3: Emerging Technologies in Data Center Services

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Surprisingly, there is a significant rejection of Cloud Computing at this point (only 14.9% of all data centers have adopted), yet this technology has been considered by an additional 46.3%, but never implemented.

These are very interesting figures as Cloud Computing gets all the press and hype but the reality is the adoption rate still lags more traditional and proven technologies.


Data Center Assessment

o Operationalo Facilities

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“How do we determine our future Data Center Strategy?”

Phase I – Data Center Operational– Operating Systems– Applications– Technology– Data Storage– Infrastructure

How do I “Evaluate” my Data Center?

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– Infrastructure

Phase II – Data Center Facilities– Facilities Capacity and Capabilities– Power– Cooling– Fire Suppression– Telecomm– Security

Phase I – Data Center OperationalOperating SystemsA review operating systems in order to leverage the redundancy and maximize the resource utilization. Examples include: H/P–UX, UNIX, AIX, Solaris, Windows NT, 2000, Advanced Server, Datacenter, Linux, Netware, etc.

ApplicationsThe review will include current server applications in use, versions and the potential to consolidate different applications, partition or utilize alternative technologies.

Hardware Technology (Servers)A review of the current server environment including server mix; Blade, Commodity and Enterprise class.

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Enterprise class.It also includes a review of the potential for optimizing the current environment including; physical consolidation, virtualization, application stacking and life cycle management along with other options.

Data & StorageStorage analysis should include local server drive storage, Data Back-up/Restoration, Data Retention, NAS and/or SAN options as well as Disaster Recovery process related to data handling capabilities.

Infrastructure ReviewThe LAN/WAN components and connectivity requirements along with switches, routers, firewalls and other connectivity points.

Phase II – Data Center Facilities

ObjectiveTo review the Current Data Centers for the ability to meetthe current and future requirements defined in the DataCenter Operational review.

The Facilities Assessment includes a review of all Data Center/Computer room facilities and related equipment including:

- Capacity, Environmentals and Physical Components

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- Capacity, Environmentals and Physical Components- Maintenance Schedules- External Connectivity- Physical Security, Monitoring, Testing and Documentation - HVAC, Fire Suppression, Wiring, Power, Redundancy- Sensors, Space Requirements, Utility Costs, etc. - Data Center Facilities Staff Knowledge and experience

“We always seem to be running out of power or cooling in our Data Center? Is this common?”

Data Center Capacity Drivers:

Physical Space

How do I know when we are going to run out of Data Center capacity?

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o Physical Spaceo Rack Space, Ceiling Height, Floor Weight

o Powero Main Power Feed, Facilities Draw, Actual Power to Rack, Equipment

o Coolingo External, Internal, Ambient Air, In-Row Solutions, Raised Floor Height

How Long will my Data Center “Survive”?

# TonsNumber of

Units

BTUs per

TonMin BTUs Max BTUs

Building air supply - - 12,000 - -

Cooling capacity per Unit 20.0 15 12,000 3,600,000 3,600,000

Cooling capacity per Unit 12.0 3 12,000 432,000 432,000

Cooling capacity per Unit 5.0 2 12,000 120,000 120,000

Total Cooling Capacity 346 4,152,000 4,152,000

Physical

Devices

Typical

Watts per

Device

Typical

BTU per

Device

Min BTUs Max BTUs

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Cooling demand

WAN 118 135 460 (54,297) (90,495)

LAN 61 77 262 (15,972) (26,620)

Storage & Backup 92 427 1,455 (133,882) (223,137)

Telco 42 310 1,057 (44,373) (73,955)

Servers & Mainframes 701 433 1,478 (1,035,742) (1,726,237)

Estimated Cooling Demand (1,284,266) (2,140,444)

Less estimated efficiency loss 30% (1,245,600) (1,245,600)

Available Cooling Capacity (BTUs) 1,622,134 765,956

Cooling Adequate (Yes/No/Insufficient Data) Yes Yes

Cooling Redundant (Yes/No) Yes Yes

Maximum Number of Servers 1,799 1,012

Minimum Cooling Required (Tons) 211 282

Methodology Explanation Examples

Upfront

Cash

Investment

Technical

Risk

Outage

Risk

Support

Impact Risk

Resource

Impact

Compression

Conslidate like servers on existing

hardware or retire

applications

File and print Low Low Low Low

Immediate

decrease in

workload

Re-platform

Migrate applications

from expensive

platforms to

commodity servers.

• File and print

• Utility servers

• Itanium to

quad core

Low Low Moderate Low

Shift in

workload,

typically no

decrease

Rolling Migration

Consolidation of

servers as

equipment is

replaced during

• Virtualization

• Application

stacking

• Physical

Moderate

Moderate

due to

changes in

OS and Low Low

Increased

resource

cost due to

extended

Consolidation – What does this really mean?

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replaced during

regular lifecycle

refresh intervals

• Physical

replacement

OS and

App

versions

extended

timeline

Mass Refresh

Purchase of new

servers with new

technologies and

migrate en masse

• P2V• 3-5 year lease

agreements

High High High

Initial

increase, followed by

tapering of

support

Increased

resource

cost during

transition

Outsourcing

Migration of key

systems to third

party hosting

facilities to avoid

upgrades to the data

center

• Web services

• B2C systems

• SAAS

• Systems with

24x7 uptime

requirements

Low Low Low Low

Reduces or

reallocates

internal

support

staff

This chart provides example methodologies which may be utilized in the consolidation of Data Center operations. One, some or all of these may be implemented depending upon the environment, business requirements, risks and costs.

Actual Client Results

Corporate EntityCorporate Entity

Organization Background

- Three Primary Data Centers, two production, one Disaster Recovery- 30+ remote Data Centers/Computer/Telecomm rooms- Approximately 5,900+ servers, (Mainframe, Midrange and Wintel)

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- Approximately 5,900+ servers, (Mainframe, Midrange and Wintel)- Estimated 10,000 remote and 20,000 corporate users

Issues

- Client was reaching maximum Data Center power capacity- Client had upgraded their Data Center cooling to maximum capacity- They were looking for a way to extend the life of their Data Centers- They needed to reduce their Data Center physical foot print


Clients Solution

- Implement server virtualization in their environment- The internal server team made this decision with management support- Plan was to complete server virtualization in four years

Issues with Client Approach

- They were approaching the solution from a single view – virtualization

Internal Client Solution

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- They were approaching the solution from a single view – virtualization- The Client did not have an overall Data Center Operational Strategy- The VP wanted to validate the internal virtualization process

Operational Review identified Issues

- Operating Systems – Client had 43 different O/S versions- Applications – Identified 1,743 different applications and versions- Servers – 66% of the production servers were older than five years- Storage – diverse storage and under capacity - WAN/LAN – Appropriate for the enterprise- Staff – The staff had limited virtualization experience


Clients Server Virtualization Results

- The solution would be completed with internal staff- The solution would reduce the server counts from 5,972 to 4,031- The virtualization would be complete in four years- Server virtualization would save the Organization $6M over 5 years

Is Server Virtualization worth the Effort?

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Client Issues still present

- Operating Systems – Client had 43 different O/S versions- Applications – Identified 1,743 different applications and versions- Servers – over 50% of the servers were older than five years- Storage – diverse storage and under capacity


Complete Data Center Strategy Results

- Operating Systems – The 43 O/S versions were reduced to under 10- Applications – 1,743 applications/versions were reduced to 890- Servers – reduced from 5,972 to 2,167, all five year old servers replaced- Storage – Additional storage was purchased to meet capacity - Staff - Internal staff supported with eight external staff

Is a Data Center Enterprise Strategy Beneficial?

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- Staff - Internal staff supported with eight external staff- The solution was completed in 15 months- The solution incorporated: physical consolidation, compression,

virtualization, application stacking, storage and limited re-platform.

Financial Results

- Organizational NET Savings of $26M over five years.

How Mature are my Data Center Services?

o Collocationo Managed Collocationo Outsource

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o Outsourceo Service Stackso Cloud Computing

Data Center Services Maturity Model

Basic Services Advanced Services

Collocation Managed Outsource Sourcing Cloud

As the Data Center Services mature, the ability to provide services on an “As Needed” basis to the end user client maximizes efficiencies and is typically more cost effective.

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Basic Services Advanced Services

Data Center Collocation

“Power and Pipe”

Vendor Responsibilitieso Building Facilitieso Security: 24 x 7 security and alarm monitoring o Power: AC and DC power with emergency generators o Cooling: HVAC redundant design with air distribution

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o Cooling: HVAC redundant design with air distribution o Fire Detection: Detection and suppression technologieso Cabinets and rackso Network: WAN bandwidth

Client Responsibilitieso All assets owned by Client: server, network, and storage hardwareo Resources to support all hardware, OS, and applicationso Tape backup and rotation responsibilitieso Disaster Recovery responsibilitieso Monitoring and Service Desk capabilities

Data Center Managed Collocation

“Managed Services”

Vendor Responsibilities

Same as collocation plus the following services:o Implementation and support of hardware and OSo Performance monitoring of all hardwareo Tape backup and rotation responsibilitieso Updates, patches, log maintenance, troubleshooting, security

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o Updates, patches, log maintenance, troubleshooting, securityo DBA support to triage and perform routine maintenanceo Managed Networking: user access, firewalls, IDS/IPS, anti-virus o Virtual infrastructure Management: utilization, failover, performanceo Standardized support processes: continuous process improvemento Service Desk integration (single service desk at the enterprise level)

Client Responsibilitieso All assets owned by Client: server, network, and storage hardwareo Resources to support applicationso Disaster Recovery responsibilities

Data Center Outsource Services

“People, Processes, Product”

Vendor Responsibilities

Same as Managed Collocation plus the following services:

o All resources are provided by vendoro Assets are owned and responsibility of the vendoro Processes and methodologies to manage IT operations

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o Processes and methodologies to manage IT operationso Software support for the commodity applicationso Application performance metrics and reportso Multi-level Disaster Recovery plano Service coverage is 365 x 24 x 7o Help Desk is the vendor’s responsibility

Client Responsibilitieso Custom applications, (test, development, support)o Custom DBA work (new enhancements, development)

Applications

Operating Systems

Software As a Service

Platform As a Service

Traditional IT Structure Service Sourcing Structure Cloud Computing

Data Center Service “Stacks”

Solutions are

“Services are Sourced”

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Operating Systems

Mainframe, Servers

Data, Storage, DR

WAN, LAN, Network

Data Center

Facilities


Infrastructure As a

Service

Client

Internet

Solutions are deployed

“On Demand” with

“Pay as you go” type of service.

Data Center Cloud Computing

Applications

Operating Systems

Software As a Service


Traditional IT Structure Service Sourcing Structure Cloud Computing

“Services are Sourced via the Internet”

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Mainframe, Servers

Data, Storage, DR

WAN, LAN, Network

Data Center

Facilities

Infrastructure As a

Service

Client

Internet

Solutions are deployed “On Demand” with “Pay as you go” type of service via the Internet

NOTE: There are no standard industry common components to “Cloud Computing”

Data Center “Build versus Buy”

o Are there advantages to making a long-term commitment to build a Data Center, or would we be better off utilizing a current hosted facility to meet our needs?

o What can I get for my investment?

o What is the best use of my money?

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o Do I upgrade, build new, or use an external provider?

o Do I address production, DR and test/development environments differently?

o What is a Tier Level and how important is this as opposed to a business level?

The decision to own the facility

The benefits of owning and building include:

o Typically the lowest cost long-term optiono If the strategy includes consolidation of other DC’s return on

investment can be as soon as four years but less than ten.o The Client owns and controls the facilityo The Client can make independent decisions without impact to other

“Building a New Data Center”

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o The Client can make independent decisions without impact to other vendor provided requirements.

The disadvantages typically are:

o Significant upfront initial investmento Long-Term process which may require an interim solutiono Requires a long-term commitmento May not offer the technical and business flexibility

“Buying (Sourcing) a New Data Center”

The decision to buy Data Center Services

The benefits of sourcing DC services include:

o Typically the lowest up front cost optiono Implementation can occur quickly in relative termso The Client can take advantage of already implemented policieso The option provides for technical and business flexibilityo It does not require a long-term commitment

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o It does not require a long-term commitment

The disadvantages typically are:

o Typically higher long term costo Will require some conversion to providers requirementso May not provide a long-term solutiono Control of the facility is by the vendor

$400,000

$600,000

10-year Projected Costs

New Data Center Collocation Managed Services Outsource

“Build versus Buy Cost Comparison”

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$0

$200,000

Ye

ar

1

Ye

ar

2

Ye

ar

3

Ye

ar

4

Ye

ar

5

Ye

ar

6

Ye

ar

7

Ye

ar

8

Ye

ar

9

Ye

ar

10

This client example shows the cost of collocation and build are the lowest. The cost to build becomes more cost effective around year 7.

“Hybrid Options – Common Solutions”

The decision of a hybrid solution

“ A hybrid solution requires a prioritization of the Data Center services from the operational assessment. Upon completion of the operational assessment, the services are ranked and Data Center services are provided based upon criticality.”

An Example of this might be:

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An Example of this might be:

o High criticality services (applications and infrastructure) are placed in a managed collocation external type of service.

o Mid criticality services are placed in a standard collocation service.o Low criticality services are consolidated into limited current Data

Centers with specific upgrades.o Commodity services could be outsourced to a “Cloud” solution.

Thank YouThank You

QuestionsQuestions& &

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& & AnswersAnswers

Sponsors SummarySponsors Summary

Excipio Consulting Organization

Who We Are – Overview

Excipio Consulting has experts with many years of IT experience. They perform a wide variety of IT/IS assessments for organizations. This includes, Desktop, Network and Service Desk Management, Data Center operations and facilities, Application evaluation and integration, Shared Services Catalogs and Cost Models along with client RFP creation and vendor analysis.

Specific to Data Centers, Excipio has completed over 400 Data Center

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assessments in the last 30 months, for both public and private organizations ranging in size from 350 to over 100,000 employees.

This includes organizations such as the States of Minnesota, Washington, Michigan and Pennsylvania, private companies of US Bank, Carlson Companies, MD Anderson, Baxter Labs, Lowes and others.

Excipio helps clients focus on assessing growth, capacity, consolidation, risk and financial benefits related to operating your own data center or location of your equipment with an external partner. Key evaluation topics focus on the most effective and efficient ways to understand and determine your future Data Center strategic “Road Map”.