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Spotlight on Cost. Virtualization by Numbers: The Business Case. . Server Infrastructure Optimization. . Agenda. The Theory Hypothetical Company Profile Opportunity Approach Solution Value Compelling Economic Advantages Proposed The Practice Case Studies - PowerPoint PPT Presentation
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<<Customer name>>Server Infrastructure Optimization <<date>>
Virtualization by Numbers:The Business Case
Spotlight on Cost
AgendaThe Theory
Hypothetical Company Profile OpportunityApproach SolutionValueCompelling Economic Advantages Proposed
The PracticeCase StudiesNext Steps
The Company – Contoso AeroEnterprise Profile
Mid size Aerospace and Defense business operating in the United States with 3,000 employees in 3 primary (suburban) locations
Business ProblemNeed to improve availability and quality of disaster recovery systems to meet requirements of the new set of government contracts without driving cost of IT operations up. No projects with Payback Period over 12 months will be approved by the CFOSoftware budget of $500K, Project budget $1M
IT environment 182 production servers and 82 Disaster Recovery servers in DC supporting 3 manufacturing locations growing at 10% annual rate (4 year server life cycle) supporting over 180 applications
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The Opportunity
Consolidation: currently runs at under 10% CPU utilization on averageDisaster Recovery: currently 0.4 DR servers for every Production server ratioHigh Availability: Currently, no clustering implementedGreen: over 60% of peak power usage on idle servers
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ApproachUse server consolidation with virtualization to “pay” for High Availability and Disaster Recovery solution
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As-Is To-BeProduction
Server# of
ServersServer Type
# of Serve
rs
Server Type
VMs to Support
File / print servers 100 2 CPU
Consolidate 182 production servers and 82 Disaster Recovery servers to 57 servers, a 4.6:1 consolidation ratio
E-mail servers 25 4 CPUApplication servers 20 2 CPU Database servers 12 4 CPU Web servers 25 2 CPUTotal Production 182 2/4 CPU 44 4CPU 182DR servers 82 2CPU 13 4CPU 182Total 264 602 CPUs in
total57 4CPU 364
Benefit Overview
Three year net benefits $4,684,753 Three year investment in Microsoft Virtualization
$717,653
Return on Investment (Net Benefits / Total Investment)
553%
NPV Savings $3,719,792 Payback Period (in months) 6
1. Production server consolidation savings are supporting IT services improvements in HA and DR
2. Payback and Investment requirements met3. HA and DR contributes to the ROI4. Power and CO2 emission impact completes the picture
Three Year Benefit Analysis Before Costs After Costs Difference % Difference
Production Server Consolidation and Management Benefits $6,826,946 $2,869,405 $3,957,541 58.0%
Production Server Consolidation Green IT Benefits $1,040,672 $308,157 $732,515 70.4%
Production Server High Availability Benefits (Indirect) $935,234 $236,566 $698,668 74.7%
Production Server Disaster Recovery Benefits (Indirect) $25,693 $12,011 $13,682 53.3%
Three year total benefits $8,828,545 $3,426,139 $5,402,406 61.2%
Benefits 1: Production Server Consolidation & Management
Three year benefit
analysis Before Costs
After Costs
Difference
% Difference
Existing Server Cost Avoidance $2,889,600 $1,432,100 $1,457,500 50.4%
New Server Purchase Cost Avoidance $620,800 $340,200 $280,600 45.2%
Networking Savings $275,880 $80,370 $195,510 70.9%Networked Storage Savings $549,480 $157,890 $391,590 71.3%Provisioning Efficiency Savings $56,187 $6,914 $49,273 87.7%
Change Management Efficiency Savings $976,732 $326,731 $650,001 66.5%
Operations and Administration Efficiency Savings
$1,458,267 $525,200 $933,067 64.0%
Total $6,826,946 $2,869,405 $3,957,541 58.0%
Benefits 2:Production Server Consolidation Green IT Benefits
Three year benefit analysis
Before Costs
After Costs
Difference
% Difference
Power and Cooling Savings $716,919 $261,899 $455,020 63.5%Data Center Space Savings $323,753 $46,258 $277,495 85.7%Total Financial Green Impact $1,040,672 $308,157 $732,515 70.4%Carbon Emissions per Year (in metric tons) 1,469 464 1,005 68.4%
Number of Equivalent Cars Carbon Emissions (per year) 269 85 184 68.4%
Number of Equivalent Trees to Cover CO2 Emissions (per year) 37,667 11,897 25,770 68.4%
Number of Equivalent Homes Carbon Emissions (per year) 158 50 108 68.4%
Indirect Benefits
Production Server High Availability Three year benefit analysis Before
CostsAfter Costs
Difference
% Difference
Total Downtime Avoidance Benefits $935,234 $236,566 $698,668 74.7%
Production Server Disaster Recovery BenefitsThree year benefit analysis Before
CostsAfter Costs
Difference
% Difference
Production Server DR Benefits (Indirect) $25,693 $12,011 $13,682 53.3%
Investment: To achieve these benefits, the investment in Microsoft is expected to be as follows:
Microsoft Virtualization Investment (costs) Total Costs Over Three yearMicrosoft Integrated Virtualization Licensing Costs $524,283Production Server Virtualization Professional Services Costs $156,750Production Server Virtualization Implementation Labor Costs $36,620Production Server Virtualization Training Costs $0 Three year total costs $717,653
Software Investment
Licensing Components:Full WS08 licensing and CALsFull SMSE licensing
Competitive Comparison Table
Competitive Cost Comparison
With Microsoft Server
Virtualization Solution
With Competing
Server Virtualization Solution
Competitive Savings
with Microsoft
Virtualization
Competitive Savings with
Microsoft Virtualization
(%)Production Server Virtualization - Competitive Cost Comparison $458,426 $1,165,096 $706,670 60.7%Return on Investment (Net Benefits / Total Investment) 552.8% 244.9% 307.9%
Three Year potential net benefit: $4,684,753
Case Studies
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Hawaii bank saves money and time by consolidating server environment
“One of our goals was to reduce total cost of ownership. By consolidating the server network with Hyper-V, we did lower ownership costs, including hardware, software, and operational expenses.”Rick Shibata, Technology Infrastructure Services Manager, American Savings Bank
Cut hardware costs Reduced power
consumption Anticipated $30,000
annual savings in server maintenance
Decreased server management and provisioning time
Meeting business needs at lower cost
Implemented Hyper-VTM
virtualization technology in Windows Server® 2008
Installed multiple virtual machines on individual physical servers
Will consolidate up to 30 percent of server environment
Growing server network created increased hardware, licensing, and power costs
Mounting time and staff resources to manage server environment
Needed to efficiently manage server-refresh process
SolutionBusiness Challenge
Results/ Benefits
With virtualization, newspaper reduces costs, gains infrastructure flexibility
SolutionBusiness Challenge
Results/ Benefits
• Reduced Costs -Consolidated Servers with 10-20 to one ratio
• Improved Server Utilization
• Better Disaster Preparedness
• Infrastructure Flexibility
• Less Time Provisioning and Maintaining Servers
The AJC worked with Microsoft and Dell consultants to implement the Windows Server® 2008 Enterprise operating system with Hyper-V™ technology and Microsoft® System Center Virtual Machine Manager 2008
• The newspaper’s IT staff faced critical power and cost problems due to server proliferation
• Needed a better disaster preparedness solution
• Needed a more flexible infrastructure
“With Hyper-V, we get four free Windows VM licenses. We can run virtualized Linux. And we can use off-the-shelf or repurposed hardware. This gives us significant flexibility and cost savings.”Brent Register, Client/Server Engineering Manager, The Atlanta Journal-Constitution
Hospital uses virtualization to speed rollout of new services and improve uptime
SolutionBusiness Challenge
Results/ Benefits
Faster introduction of new services
Higher application availability
Deploy 100 servers instead of 400,
Saved approximately U.S.$1.5 million in hardware costs
Saved $150,000 in additional project-related hardware
Use Windows Server® 2008 with Hyper-V™ technology to speed server rollout
Use Microsoft® System Center Virtual Machine Manager 2008 to reduce server deployment chores
Expand physician and patient-care services
Simplify server requisitioning and provisioning
Reduce server count Reduce the number of
presentation virtualization servers
“We are using Hyper-V to quickly and cost-effectively roll out new services, which makes our hospital a more attractive partner to physicians and other organizations.”Paul Acampora, Manager of Customer Service, Saint Raphael Healthcare System
Next Steps
Use the Microsoft Integrated Virtualization Calculator to measure the financial benefit of implementing virtualizationUse the MAP tool to analyze your IT infrastructure and determine the level of impact of virtualization
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Schedule a meeting to discuss operational costs in your IT infrastructure
Ready Your Team - learn about the Microsoft virtualization solutions that align with your needs.