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© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.
A new data center strategy for the New Style of IT Bernard Cobb/ June, 2014
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Disruptive trends impacting the world of IT
Data center silos
Past
IT
value
Speed
Cost
Simplicity
Consolidation Standardization Virtualization 1.0
Timeline
Convergence
Delivering the New Style of IT
2009 2014+ Today
Cloud Mobility Big Data Security
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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The fundamental data center flaw
IT
Network
Servers
Storage
Application Business
Data center
IT silos Facility silos
Cloud Security Big Data Mobility
CIO/CFO responsibilities meeting across the entirety of IT and the data center
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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New dynamics require the New Style of IT
Scalable, modular DC
Increased utilization
Modular capacity
Cloud-enabled
Right-sized
Optimal investment
Agile and converged
IT/business-aligned
IT
Network
Servers
Storage
Application Business
Data center
IT silos Facility silos
Cash-flow Capacity Availability Flexibility
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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What you can achieve with the New Style of IT
Provision infrastructure and services as fast as the swipe of a credit card
Keep apps running with intuitive management and intelligence built in
Optimize investments and resources, with reduced cost and risk
Simplicity across the data center
Speed and agility Uptime and SLAs Efficiency
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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So what does that mean for my data center strategy?
My options • Owned data center
• Hosted (co-location)
• Outsourced
• Public cloud
Option Level of control Capital cost OPEX
Owned data center
Hosted (co-location)
Outsourced
Public cloud
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc. a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
HP modular data centers
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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The facility aspect of the data center flaw
• High capital costs, especially for land, physical plant
• 15-to-20–year planning horizon: “build it now for all eventualities”
• Long construction cycle
• “All or nothing” facility; inability to add phases
• High operating expenses, particularly energy costs
• Inflexible design, firm IT load limits
• Limited utility-based capacity
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Chart Title
Data center builds are traditionally CAPEX-hungry
Custom greenfield
Up to 80% of costs relate to MEP infrastructure • Half of that amount is materials and labor
40% Equipment
25% Materials
25% Trade labor
10% Machinery
Chart Title
70% Equipment
10% Materials
10% Trade labor
10% Machinery
Whereas modularity shifts effort and cost from field to factory • Machinery—still used for site prep and lifting equipment • Labor and materials—connecting all pieces together
Modular
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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The HP modular data center—a complete package
Modular elements typically included
• Data halls (includes fire protection, security, and monitoring)
• Electrical plant
• Mechanical plant
• Factory-built
The modular data center range
• HP POD
• “Standard” modular (FlexibleDC)
• “Custom” modular
• Multi-tiered hybrid brick and mortar
Turnkey solutions, with everything included, are ready for your IT infrastructure
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Innovative modular technology
Reduced project schedule
• Concurrent activities within design and supply chain
Increased quality control
• Process engineering
• Standard production
• Factory testing
Reduced and/or mitigated project risks
• Site logistics and safety
• Site resource requirements and labor uncertainties
Menu-driven process for selecting mechanical and electrical plant
A unique industrialized approach that offers improvements over conventional design
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Modular DC offer from HP
Capacity, cost, time to deployment
Flexibility, modularity, efficiency
Custom brick and mortar
Custom modular
Standard modular
HP POD solutions
Type
Custom brick and mortar
Custom modular
Standard modular
HP POD solutions
Typical IT load
10 MW
5 MW
0 MW
1 MW to 50 MW+
500 kW to 10 MW+
500 kW to 6 MW
150 kW to 1.5 MW
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Examples of HP’s modular data center range
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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IT and facility modularity combined
Modular financing
Modular consumption
Modular deployment
For IT, this exists in PaaS (platform as a service) and IaaS (infrastructure as a service). Combined with virtualization, IT is packaged into deployable units and presents disparate parts into a module. We call this the converged infrastructure.
In the data center, it is capacity management that benefits by having the ability to deploy a module of IT, power, or cooling as a single unit of measure, instead of a large brick-and-mortar project.
The facility infrastructure is right-sized for current usage. Data center capacity can be measured and consumed by power instead of space.
With incremental growth, capital requirements and the cost of capital more closely match facility utilization.
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc. a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
Introducing HP Facility-as-a-Service
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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HP Facility-as-a-Service (FaaS)
• HP FaaS provides a modular data center, designed to clients’ specifications where they also want to maintain control over IT operations. FaaS provides clients with data center facilities, under a long-term operating maintenance service agreement, which provides off-balance sheet financing* and reduces initial capital investment.
• FaaS allows customers to match facility costs to their revenue streams, and mitigates their risks of building a data center that is either too big and inefficient or too small and at capacity.
• FaaS is a new alternative to funding the build of a new data center or utilizing co-location space, the only previous options for owner-operated solutions.
* Subject to financial reporting regulations and practices, territory by territory.
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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HP FaaS 101
A modular data center, client (owner)-operated • Full usage, provisioned through an ongoing, fully leveraged maintenance
service agreement
• HP retains ownership
Maintenance agreement covers • Building infrastructure and plant
• Prefabricated data center modules (HP POD when applicable)
• Electrical equipment: generator, power conditioning, utility transformer
• Cooling equipment: chiller/air conditioning
Ongoing service for preventive maintenance or facilities management
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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What HP FaaS is and is not
FaaS is FaaS is NOT
A time-based maintenance agreement, with cost of the facility included in the monthly charge
An outsourcing arrangement
A data center facility A cloud service or HP Flexible Capacity
Risk-mitigated and future-proofed A one-time, low-cost commodity solution
Customer-operated Co-location or a hosted service
Custom-designed to client specifications A one-size-fits-all, inflexible, boxed solution
Client-directed; if desired, clients can work with their own general contractors, and HP can act as a PMO
Tied to an HP turnkey delivery
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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The financial justification Cumulative cash outlay for a facility with 1 MW day-one capacity
Cumulative OPEX for a facility with 1 MW capacity
Co-location pricing assumed at $450/kW/month inclusive of all costs
Millions
60
50
40
30
20
10
0
Build
Co-location
FaaS
Millions
60
50
40
30
20
10
0
Build
Co-location
FaaS
1 2 3 4 5 6 7 8 9 10 1 2 3 4 5 6 7 8 9 10
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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How FaaS compares to self-build and co-location
Traditional self-build Co-location services HP FaaS
Data center is a “one-off” project Client pays “rent” for shared data center FaaS is an ongoing partnership between the client and HP
Relation with constructor ends, except for warranty
Client has no control nor input into decision-making/management
HP provides a DC to meets client’s needs today, provisioned for ongoing needs
Client assumes risk that what is built meets their needs
Provider owns and controls the facility and infrastructure
Facility develops as client needs change
Funding needs justifying vs. business needs
Provider controls access and change management
Client maintains physical control of the facility and its operations
Temptation to overbuild Client adjusts IT to co-location capacity/reliability restrictions
Facility costs match business needs at the given time
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Deeper dive, operational comparison with co-location
Feature Co-location provider HP FaaS
Physical security Service provider controls Customer controls
Infrastructure access Service provider controls Customer controls
Maintenance Service provider schedules Customer and HP will schedule together
Change management Service provider controls Customer controls
Physical access Shared with other service provider customers Customer restricts and controls
Network hub Service provider decides and controls Customer decides and controls
IT density in rack Service provider may dictate or restrict Customer controls
Expansion/growth/new technology
Service provider may restrict Customer controls
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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The FaaS decision tree
Need a new data center
Yes
HP Enterprise Services (ITO)
No What is the
business priority?
Minimize both initial capital investment and manage ongoing OPEX
HP Facility- as-a-Service
Manage ongoing operational expenditures
Build new data center
Minimize initial capital investment
Utilize co-location provider
Want to outsource IT operations
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Benefits of HP FaaS with HP modular data centers
HP Facility-as-a-Service
• Reduced initial capital investment, redirect capital resource
• Long-term operating service agreement, full operating coverage
• Owner-operated model, designed to meet needs and maintain control of IT
• Alternative to complete outsourcing or co-location
• Designed to your use case for capacity, criticality, and provisioning
• Modular approach provides provisioning to match future IT rollout plans
• Adding modules over time matches facility costs to revenue stream
HP modular data centers
• Prefabricated infrastructure components provide shorter project timeline
• Component menu accommodates all needs
• HP solution and project overview provides plug-and-play, turnkey data center
• Industrialized project cost-efficiency, quality control, and rapid deployment decrease time to market
• Improved quality of facility and IT integration creates optimized data center
• Flexible facility provides right-sized, right-timed operations that adjust over time
• Modular design criteria provides optimal operational efficiency
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Client engagement with HP Critical Facilities Services • Determine sourcing strategy
• Facility strategy, design, implementation, assurance
• In tandem with IT program
Critical Facilities Strategy
• Capacity projections • Availability needs • Financial criteria • Operating criteria
Critical Facilities
Design
• Designed-in modularity • Flexibility to meet projections • Multilevel availability
Critical Facilities
Implementation
• HP PMO • Speedier time to market • Option of HP or GC build program
Critical Facilities
Assurance
• Factory testing • Integrated system testing • Operational readiness
HP PMO on FaaS
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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HP FaaS methodology
Civil and structural construction
Contractor
Data center maintenance
HP + Contractor
Modular data center and MEP equipment
install
Contractor
• Design • Site supervision • Testing and
commissioning
• Can be HP turnkey • Customer can contract
GC of choice directly
• Scheduled preventive maintenance
• Reactive
• Data center modules • Modular electrical and
cooling systems
Customer
HP PMO Design the DC Site preparation Implementation Operation Contractual relationship
Technical requirements
HP
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc. a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
Aspects of the agreement
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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FaaS contracting model: two separate customer contracts • One-time contract for site preparation/construction that customer owns
• Ongoing service agreement for MDC and infrastructure that HP owns
Infrastructure Facility-as-a-Service contract
General contractor
Civil and structural site preparation contract
HP as prime
General contractor
General contractor as prime
HP
General contractor
Customer as operator/user
Installation
Operations HP as owner
HP as prime
Customer as owner
Customer as owner
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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FaaS contract model for modular data center and infrastructure
IT infrastructure
DC and IT maintenance
DC infrastructure Usage fee
over 5 years*
Usage fee
over 5 years*
Service fee over 5 years*
Integrated service solution as monthly fee
over 5 years*
Design, implementation, and commission: services-based delivery milestones
• Does not matter if HP is prime or not • One-time service, independent of overall solution • Customer fully invoiced upon delivery acceptance
Ongoing service agreement
* Or length of agreement as determined contractually or by regulation.
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Client aspects of the maintenance service agreement
Client responsibilities End-of-service options
• Physical control of assets on client’s site
• Insurance of tangible assets
• No alteration/modification of assets
• Usage of assets for business purpose only
• Usage based on manufacturer specifications
(normal wear and tear)
• Extend service agreement for next contract period
• Automatic renewal of service agreement after first 5-year term
• Buy-out assets and become legal owner
• Buy-out remaining service term; both financed amounts and ongoing services (also applies to early termination)
Termination conditions and pricing is established with initial contract
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc. a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
Beyond FaaS
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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HP ongoing services
Facility maintenance services
Preventive maintenance
Reliability assurance testing
Custom call handling, incident support
Operating procedures oversight
Facility management
IT support
HP Proactive Care Services
HO Datacenter Care Services
Full IT Managed Services (HP Enterprise Services)
IT provisioning: HP Flexible Capacity service
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Combine HP FaaS with HP Flexible Capacity
Modular data center + modular IT
Flexible Capacity
Network Servers Storage
Facility-as-a-Service
FaaS Flexible Capacity
• OPEX, not CAPEX model
• Align infrastructure expense to revenue
• Maintenance contract for operational efficiency
• Data center capacity not over-provisioned
• Add data halls on current, identified needs
• Integrate with converged management system
• OPEX, not CAPEX model
• Align infrastructure expense to revenue
• Enterprise-grade service for operational efficiency
• Unlimited; capacity buffer is refreshed as it is used
• Add capacity on current, identified needs
• Accurately monitor and manage capacity
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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From building and maintaining a data center to building and consuming IT
Apply similar models to both data center and IT
• DC: Pay only for the data center you need today, configured and provisioned how you need it, plus a data center maintenance contract, each month
• IT: Pay only for the servers, storage, networking capacity, software licenses, support, and services you actually need and use each month
Flexible Capacity monthly payment includes1 • Servers
• Storage
• Networking
• Software
• Services
Back Office Solution Powered by HP and
1Minimums apply below certain usage levels
FaaS monthly payment includes
• Building infrastructure
• Prefabricated data center modules (includes fire protection, security, and monitoring)
• Electrical equipment: generator, power conditioning, utility transformer
• Cooling equipment: chiller/air conditioning
• Infrastructure
Variable usage = variable payment
• Usage = Billing
• Usage = Billing
• Usage = Billing
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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Simple call to action
More capital tied up in a facility, less can be invested in your business • Build only what you need, as you need it
• Facility as a Service – modular build, modular deployment with modular payments
• Match facility spend with IT and business needs
• Look to HP to provide different, less capital intensive, data center and IT solutions
© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. As required by local U.S. or foreign law and/or regulation, professional engineering services will be provided by EYP MCF, Inc., a subsidiary of HP, or by an EYP MCF-related practice entity, or by another qualified engineering services provider in that location.
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© Copyright 2014 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.
