Apple in Enterprise

8/9/2019 Apple in Enterprise

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AppleinEnterpriseacostmodelanalysis

In17thcentury,anapplechangedtheworld.In21

stcentury,Applesetsoutto

changeitagain

2008

NiranjanNandakumar([email protected])

iSchoolatSyracuseUniversity

05/01/2008


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Executive Summary:

Apple Computer, founded in 1976, is known to have played a significant role in

shaping the personal computing market over the years. Although they have had their

share of ups and down, which has seen Microsoft gaining significantly over them, a stage

has reached now, where Apple can boast of entering the enterprise market through its

reliable and feature filled product line.

This paper is an attempt to build a cost model for analyzing the enterprise market

and understanding the cost effectiveness of an Apple solution and a Microsoft-Dell

solution in the IT division of a small, mid-size and a large organization. The analysis has

been done over three years in a typical IT investment, and the total costs incurred in both

solutions have been calculated based on hardware, software, maintenance and IT staffing

costs.

Results have been obtained for two scenarios a mid-size organization with an

employee base of around 500 and a large organization with 10,000 employees. Based on

the analysis, it has been found that although the hardware costs in case of an Apple

solution can be high, the software licensing costs incurred in a Microsoft-based solution

can negate this. In most organizations, this high hardware costs has been the cause for

reluctance to purchase Apple products for its IT deployments. The reliability of Apple

Mac computers and its dependence on the UNIX platform can actually reduce this cost

difference even further, through decreased maintenance costs and lower number of

experienced IT staff required to support and maintain it.

This paper further tries to throw light on some of the technical challenges that

still stand in the way of Apple from successfully entering the enterprise market.


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TableofContents

Introduction: ................................................................................................................................................................4AnalysisofTechnology:...........................................................................................................................................5Scopeofthisproject:.................................................................................................................................................7Hardwareusedforthecostmodelanalysis: ..................................................................................................8Assumptions:................................................................................................................................................................8ScenariosAnalyzed: ..................................................................................................................................................9Analysisoftheresults:..........................................................................................................................................13SensitivityAnalysis: ...............................................................................................................................................14SensitivityCharts: ...................................................................................................................................................16Conclusion:.................................................................................................................................................................17Insightsfromthecostmodel: ............................................................................................................................18References:.................................................................................................................................................................20AppendixA:TechnicalSpecifications:AppleSolution............................................................................21AppendixB:TechnicalSpecifications:DellMicrosoftSolution...........................................................24


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Introduction:

For long the enterprise IT infrastructure market has been dominated by PC and

Microsoft Windows based solution for server infrastructure and RAID subsystems. In the

recent years, the emergence of open source Linux and Apple solutions have been seen as

a threat to this dominance. This paper attempts to build a cost model for the IT

infrastructure requirements and compare the cost effectiveness of Apple Solution with the

existing Microsoft-Dell solution.

Although attempts have been made to deploy Mac as a replacement for PCs as

user desktops and laptops, there has been very little progress in breaking the barrier at the

data center level of IT in an organization. As the Macworld editor-in-chief Jason Snell

points out1, Clearly, the price tags for PCs are lower -- at least at the low end. However,

we recently tested the speed of high-end Macs and PCs, and they're comparable -- for

comparable prices -- in many areas. So, it's probably most realistic to say that while the

cheapest PCs cost less than the cheapest Macs, the cheapest Macs are probably

comparable with PCs that cost a similar amount

Once seen as a computer for marketing and media companies, Apple has started

to come out of its veil, spreading into a wide variety of business environments through its

highly reliable product line and competitive pricing. The sections that follow throw light

on some of the technological competencies of Apple that are compared to the existing

Windows-based solution and finally present the results of the cost model analysis,

providing insights to what can be seen in the future.

1Mac vs. PC: The truth About TCO James Maguire, 11/22/2003,

http://www.newsfactor.com/story.xhtml?story_id=22738&page=1


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Analysis of Technology:

As stated earlier, Apple has made a substantial improvement over the recent

years, in an attempt to gain an entry into the enterprise market. The solutions that are

being offered in the server and storage sectors have grown to match the already existing

infrastructure. The Apple server solution - Xserve2 - provides enterprise class server

solutions with up to 8-core processing power and 3 TB of internal storage. Apple also

provides solutions for storage, through its Xserve RAID with storage capacity of up to

10.5TB in each 3U enclosure. Together with third party hardware such as Promise V

Trak RAID subsystems3, and Xsan4, an enterprise-class storage area network (SAN)

solution, Apple competes with the existing solutions for IT infrastructure in large and

small organizations.

In the software side, its Mac OS X Server (Leopard) has had proven track record

of seamlessly integrating with the existing Windows-based solutions as support for small

work groups within large organizations. The table below briefly illustrates the features

that a Mac OS X Server offers and the analogous features in the existing solutions.

2 Xserve - http://www.apple.com/xserve/

3Promise RAID storage solutions -

http://store.apple.com/AppleStore/WebObjects/BizCustom.woa/9084006/wa/PSLID?nnmm=browse&mco=A58D4EFB&node=home/shop_mac/mac_accessories/promise&wosid=VfVytU3PsyXB2Xl8wcK2pnSaf

Cr

4Xsan - http://www.apple.com/xsan/


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5

As Ryan Faas6 points out in his article on Whats new in Leopard Server,

Leopard Server provides easy-setup servers for many small businesses, and includes a

new simplified setup process and systems management interface. The table shows that,

most of the common applications and solutions required for a complete deployment in the

IT department of an organization, are offered by Apple through its Mac OS X Server.

One of the most notable among the features offered, that requires special mention

is the Open Directory, which is analogous to the Active Directory in Windows based

solutions for directory services. Apart from its ease-to-use interface to add on to the

features that are essential to the enterprise user management, Open Directory

enhancements in the latest version of Mac OS X Server (leopard) supports cross-domain

authorization. This allows an Open Directory master to be bound to another LDAP-based

directory server, including Active Directory. The Open Directory master can then

authorize access to services for users whose accounts reside in the directory system to

5 Technology Overview - http://cluster.earlham.edu/detail/cairo/doc/xserve.pdf

6 Whats new in Leopard Server Ryan Faas, 10/28/2007, Computer World,

http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=9043839


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which it is connected via Kerberos6. It involves enhanced directory integration

capabilities with other directory services such as the Active Directory. This can prove

beneficial to small organizations, which typically plug on to their client network, apart

from having their own network.

However, even though technologically Macs have proven its competency, there is

a common notion that has been lingering on, ever since Macintosh was launched in 1984

that hardware costs of Apple Computers can be less cost effective than its counterparts.

The cost model discussed in the sections that follow is an effort born out of the curiosity

to understand the real cost margin between Apple solutions and the existing Windows-

based solutions.

Scope of this project:

The primary focus of this project will be on small and medium size businesses,

which are typically the startups. The migration of a large and established organization to

Apple solutions can prove to be less cost effective. Some of the typical requirements for a

small business organization include user-end services such as file and print services,

user / directory management, web server, mail server and collaborative services such as

wiki and chat management. The project also targets systems and infrastructure required

for desktop management tools for software deployment, image creation, monitoring and

troubleshooting, security, and high performance computing.


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Hardware used for the cost model analysis:

Following are the hardware used for the cost model analysis of both Apple and

Dell-Microsoft Solution. More details on the technical specifications of the hardware can

be found in Appendix A and B.

Laptops Macbook Pro, Macbook, Dell Vostro, Dell Precision.

Desktops iMac and Dell Optiplex 755

Servers X-Serve, Dell PowerEdge R300

RAID Subsystem

Promise VTrak E-Class 16x 750 SATA RAID with X-san

Dell PowerVault MD3000i with EMC Navisphere Management Suite

Assumptions:

In the development of the cost model and its analysis later, there were some

assumptions made. These assumptions will be used to study the scenarios that will be

discussed in the sections that follow. They will then be varied to study the effect of the

assumptions, during the sensitivity analysis, to better understand the cost model and

further generalize the same. Following are the assumptions made.

1. The maintenance costs incurred over the span of three years, in case of an Apple

solution is 40% less than that for a Dell Microsoft solution. This assumption has

been made due to the fact that Mac systems and servers are highly reliable

compared to the windows based PCs.

2. Due to the UNIX platform and the ease-to-use nature of the Apple solution, it has

been predicted that the IT Staff required to support this would be significantly less


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than that for a Microsoft-based solution. For the purpose of this cost model, it will

be assumed that the reduction in IT Staff is 20%, through the deployment of

Apple solution.

Scenarios Analyzed:

To better illustrate the cost model under consideration, two scenarios have been

selected a mid-sized organization and a large organization. The requirements, as stated

in the sections below, have been used as the inputs to the cost model and the results have

been analyzed further to provide insights into the study.

Scenario 1:

The first scenario that is considered is the deployment of IT in a mid-sized

organization. Following are the parameters used for the same.

Employee Statistics:

Total number of employees - 500

Percentage of IT Staff - 0.2

50% Level 1, 30% Level 2, 20% Level 3

Avg. salary of Level 1 IT Staff - $53,000.00



Salary increment rate - 0.70

Hardware Requirements:

Number of employees using laptops 150

Number of servers required - 10

Number of Storage RAIDs required - 2


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These input variables in the cost model, yielded the following results.

The total costs over the three years, for Apple and Microsoft solution.


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Scenario 2:

The second scenario that is considered is the deployment of IT in a large organization.

Following are the parameters used for the same.

Employee Statistics:

Total number of employees - 10000

Percentage of IT Staff - 0.2

50% Level 1, 30% Level 2, 20% Level 3




Salary increment rate - 0.70

Hardware Requirements:

Number of employees using laptops 1000

Number of servers required - 50

Number of Storage RAIDs required - 10

These input variables in the cost model, yielded the following results.


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The total costs over the three years, for Apple and Microsoft solution.


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Analysis of the results:

From the results and findings of the cost model that was used to obtain the total

costs for an Apple and Dell-Microsoft solutions, it can be seen that the hardware costs for

the purchase of the Apple solution is higher than that for the Dell-Microsoft Solution.

This was expected, due to the higher pricing of the Apple hardware. It must also be noted

that, in most organizations, this initial investment has been the cause for reluctance to

purchase Apple products for its IT deployments.

However, the software costs over three years, in case of an Apple solution is

significantly lower than that in case of a Microsoft solution. A high proportion of the

software costs in case of Microsoft go into buying the Client Access Licenses (CALs)

which are priced at $799, for each 20 additional licenses. In case of Mac OS X Server,

the purchase of the Xserve brings along with it, unlimited license version for the server.

This significantly affects the costs for software on Mac. In fact this can also be seen as a

reason for the hardware costs being high. For the technical specifications of server

solution that I have considered here (see Appendix A and B), the costs of the Apple

Xserve hovers around $6100, where as that of Dell PowerEdge R300 costs $2000 less.

The cost difference seen here can also be attributed to the open source support on

Apple computers. For e.g. the SQL Server solution offered by Microsoft can be replaced

by a cheaper yet efficient mySQL solution, which is open source.

The assumptions on the maintenance costs and the reduction in IT Staff, also

proves favorable for an Apple solution, over Dell-Microsoft solution. Hence it should be

noted that, for a large, small or a mid-sized organization, Apple solution proves to be a

more cost effective solution.


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Sensitivity Analysis:

As stated earlier, the assumptions made have been varied to analyze its effect on

the total costs under the scenarios that were considered. It was assumed that there will be

a 40% reduction in the maintenance costs and a 20% reduction in the IT Support staff,

through the deployment of the Apple Solution. In this section these components are

varied to understand how an increase or decrease for these parameters can take effect on

the total costs.

The scenario 2 analyzed in the previous section has been taken as input

parameters for this study. To reiterate the results stated above, under the conditions stated

in the assumption, the results can be seen as follows.

Case 1:

Maintenance Costs reduction 40%

Reduction in IT Staff - 20%

Percentage Level 1 IT Staff 50%

Percentage of Level 2 IT Staff 30%


Case 2:







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Case 3:






Case 4:






Case 5:







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Case 6:






Case 7:






Sensitivity Charts:

The assumptions that were made to analyze the cost model for a mid-size and a

large organization were varied in the sensitivity analysis section. Seven cases were


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considered as shown above and finally the sensitivities of the total costs for Apple

solution on maintenance costs reduction and IT Staff reduction were plotted as shown in

the figures above.

It can be seen from the analysis that, the variation of maintenance costs does not

have a significant impact on the total costs. However, the reduction in IT Staff can cause

a huge reduction in the costs, typically due to the heavy pay cut that is associated with the

same. In a typical industrial scenario, both these might seem unrealistic. A heavy

decrease in the IT Staff is not achievable in a realistic scenario. Same is the case with a

substantial reduction in maintenance costs.

However as is seen from the Case 5, 6, and 7 in the sensitivity analysis, there is

also a possibility of restructuring the IT Staff. Hiring more Level 1 (entry level) IT Staff

and lowering the number of Level 2 and Level 3 IT Staff can significantly affect the

costs. This can be reasoned out by the fact that Mac OS X being heavily based on UNIX

and being highly user-friendly, does not require a large number of experienced IT Staff,

with certifications to manage them. The same can be handled by a higher number of

entry-level and mid-level staff, under the supervision of a smaller percentage of

experienced staff.

Conclusion:

Although the initial investments based on the hardware costs can be a cause of

concern to a several small / mid-sized organizations, the software costs and the licensing

costs that are imposed by the Microsoft solution can negate the heavy initial investment

on the hardware. Adding on the high reliability of Apple hardware and software, which

can reduce the maintenance costs drastically, Apple solution for enterprises seems to be a


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highly cost-effective deployment. The user friendliness and the UNIX platform on which

Mac is built, makes it easier to reduce experienced IT staff that are required to maintain

and manage it. In the long run, these attributes can prove cost effective. Over a period of

three years that has been considered here, Apple solution seems to outrun Dell-Microsoft

solution in the enterprise sector.

Insights from the cost model:

The cost model was an effective tool in trying to understand the cost effectiveness

of deploying Apple in Enterprise. The results proved to be surprising in several aspects.

The higher hardware costs of Apple have always been a hindrance in its efforts to enter

the enterprise market, when organizations were skeptical about its real ability to prove

cost beneficial. However through the release of Mac OS X Server (Leopard) and its

unlimited licensing scheme, Apple has been successful in offering competitive pricing to

push towards an enterprise entry.

There are several hitches that still stand in Apples way to being successful in the

enterprise sector. The dominance of Microsoft and its Windows operating systems has

been such that, a complete migration from a Windows solution to Apple may not be as

cost effective. Hence the real niche that Apple can target is the mid-sized and startups and

can gain momentum through new business.

From a technical perspective too, Apple still needs to cross several hurdles. With

concepts of virtualization spreading like an epidemic through the enterprise sectors, the

fact that there is no complete virtualization solution on Apple can be a cause for concern.

Also, the directory services through Open Directory, that Apple claims to be a

replacement for Microsofts Active Directory, is yet to prove its capabilities of being


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scalable across a large organization. Although there are cases of small deployments,

within large organizations where Open Directory has seamlessly integrated with Active

Directory, this can be a cause for further worry. For starters, however, I would

recommend the deployment of Apple Solution in an organization of up to 1000

employees to analyze its smoothness to integration and scalability.

Being a Mac enthusiast myself, and through an unbiased cost model analysis that

I have attempted to build in this project, I foresee a shift in the IT enterprise, that has for

long been a playground for Microsoft and PC manufacturers.


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References:

1. Apple website - http://apple.com

2. Dell website - http://dell.com

3. Microsoft Website http://microsoft.com

4. Mac vs. PC: The truth About TCO James Maguire, 11/22/2003,

http://www.newsfactor.com/story.xhtml?story_id=22738&page=1

5. Whats new in Leopard Server Ryan Faas, 10/28/2007, Computer World,

http://www.computerworld.com/action/article.do?command=viewArticleBasic&a

rticleId=9043839

6. Technology Overview - http://cluster.earlham.edu/detail/cairo/doc/xserve.pdf7. The TCO of Operating Systems: Compare the Big OSes CIO, 08/02/2007,

http://www.cio.com/article/127552

8. Going above and beyond Winn Schwartau, Network World, 02/27/06,

http://www.networkworld.com/best/2006/022706bestbreaker-

schwartau.html?page=1

9. Total Cost of Ownership for Linux in the Enterprise, Robert Frances Group,

07/22/2002, http://www-03.ibm.com/linux/RFG-LinuxTCO-vFINAL-Jul2002.pdf

10.Review Mac OS X Server 10.3 Part 1 and 2, 01/21/2004,

http://apple.slashdot.org/article.pl?sid=04/01/21/1959244&tid=179

11.Mac OS X Lab Deployment Project - http://archive.macosxlabs.org/index.html


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Appendix A: Technical Specifications: Apple Solution

(http://www.apple.com/)

Laptop Specification 1: Macbook Pro

2.5GHz Intel Core 2 Duo

2GB 667MHz DDR2 SDRAM - 2x1GB

250GB Serial ATA Drive @ 5400 rpm

SuperDrive 8X (DVDR DL/DVDRW/CD-RW)

MacBook Pro 15-inch Widescreen Display

Backlit Keyboard (English) / User's Guide

Laptop Specification 2: Macbook



120GB Serial ATA Drive @ 5400 rpm

Combo Drive (DVD-ROM/CD-RW)

Keyboard (English) / User's Guide

AirPort Extreme Card & Bluetooth

Desktop Specification: iMac



320GB Serial ATA Drive


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Apple Mighty Mouse

Apple Keyboard (English) + User's Guide

Accessory kit

SuperDrive 8x (DVDR DL/DVDRW/CD-RW)

ATI Radeon HD 2400 XT with 128MB memory

20-inch glossy widescreen LCD

AirPort Extreme

Bluetooth 2.1 + EDR

Server Specifications: Xserve:

One 2.8GHz Quad-Core Intel Xeon (quad-core)

8GB (4 x 2GB)

On-board SATA/SAS Controller

1TB Serial ATA ADM @ 7200-rpm



8x SuperDrive DL (DVD+R DL/DVDRW/CD-RW

ATI Radeon X1300 64MB SDRAM with VGA Adapter

Dual 750W Power Supply

Rack Mounting Kit - Square Hole Rack


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RAID Subsystem: Promise VTrak E-Class

3U 16-bay chassis with dual redundant power supplies and cooling modules

Dual active/active RAID controllers with two 4Gb SFP Fibre Channel ports, 2GB

DDR ECC RAID cache, SAS expansion port, gigabit Ethernet, and serial

management port

Sixteen 750GB 7200-rpm SATA drive modules

Product CD with electronic documentation

Quick start guide

Multi-language product reference guide

Rack mounting hardware for standard 4-post rack and 2-post telco rack

Two 6.0 ft./1.83 m power cords (UL/CSA/ETL/TISI Approval; Regions

supported: United States, Canada, Mexico, Venezuela, Puerto Rico, Colombia,

Philippines, Thailand)

One 6.5 ft./2.0 m RS-232 serial cable (6-pin RJ11 to DB9)


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Appendix B: Technical Specifications: Dell Microsoft

Solution

(http://www.dell.com/)

Laptop Specification 1: Dell Precision M4300

IntelCore2DuoT9300(2.50GHz)6ML2Cache, 800MHz Dual

Core

Genuine Windows XP Professional, SP2 with Media

3Year Basic Limited Warranty and 3 Year NBD On-Site Service

NVIDIA Quadro FX 360M, 512MB Turbo Cache memory (256 dedicated)

15.4 inch Wide Screen WXGA Anti-Glare LCD Panel

2.0GB, DDR2-667MHz SDRAM, 2 DIMMS

200GB Hard Drive, 9.5MM, 7200RPM (Free Fall Sensor)

8X DVD-ROM w/ CyberLink PowerDVD

Dell Wireless 1395 802.11g Mini Card

Standard Touchpad

Laptop Specification 2: Dell Vostro 1510

Intel Core 2 Duo T8100 (2.1GHz, 3MB L2 Cache, 800MHz FSB)

Genuine Windows XP Professional

1 Year Basic Limited Warranty and 1 Year NBD On-Site Service

15.4 inch Widescreen WXGA LCD Anti-Glare Display

2GB Shared Dual Channel DDR2 SDRAM at 667MHz, 2 DIMM


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8X DVD+/-RW with double-layer DVD+/-R write capability, with Roxio Creator

Intel Integrated Graphics Media Accelerator X3100

250GB 5400RPM SATA Hard Drive

Dell Wireless 1395 802.11g Wi-Fi Internal Card

No Webcam, No Digital Camera Microphone Option

Fingerprint Reader and UPEK Protector Suite software

Desktop Specification: Dell Optiplex 755

Intel Pentium Dual Core Processor E2220 (2.40GHz, 1M, 800MHz FS

Genuine Windows XP Home Edition,SP2, x32, with Media, English

3 Year Basic Limited Warranty and 3 Year NBD On-Site Service

ASF Basic Hardware Enabled Systems Management

2GB DDR2 Non-ECC SDRAM,667MHz, (2 DIMM)

320GB RAID 0 (2x160GB) SATA 3.0Gb/s and 8MB DataBurst Cache

16X DVD-ROM, Cyberlink Power DVD

Integrated Video, Intel GMA3100

Dell 20 inch E207FP Widescreen Flat Panel, Analog

Dell Energy Smart Enable

NTFS File System for all Operating Systems

Server Specification: Dell PowerEdge R300

Quad Core Intel Xeon L5410, 2.33GHz, 2x6M C

8GB DDR2, 667MHz, 2x4GB Dual Ranked DIMMs

Chassis with Cabled Hard Drive and Non-Redundant Power Supply


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Add-in SAS6iR (SATA/SAS Controller) which supports 2 Hard Drives - RAID 1

2* 1TB 7.2K RPM Universal SATA 3Gbps 3.5-in Cabled Hard Drive

8X DVD-ROM Drive, Internal, SATA

Rack Chassis with Static Rapid Rails

No Operating System

RAID Subsystem: Dell PowerVault MD3000i

Configured with two dual-port controllers (recommended for clustering)

750GB 7.2K RPM Universal SATA 3Gbps 3.5-in HotPlug Hard Drive

3000VA UPS 120 Volt, Battery Backup & Protection ,2U Rack Mount

Rapid Rails for Dell, or other Square Hole Racks, MDxx00

Four SAS 5/E HBAs, PCI-Express, 2X4 Connectors (requires 4 SAS cables)

Documents

Apple in Enterprise