vmware's impact on business

8/14/2019 VMware's Impact on Business

1/16

OverviewThis presentation presents thebusiness case for virtualizing ITinfrastructure based on: Capital and operating cost savings

from consolidation Simplified management andprovisioning Automated capacity optimization

The business impact of VirtualDesktops, Disaster Recovery, and LabAutomation are not in the scope of this

presentation.

Intended Audience and UsageThis presentation is designed for useinternally as organizations investigatevirtualization. IT

managers and directors responsible

for commissioning new projects shouldunderstand the financial benefits andimpact on IT operations.


2/16

With the growth of IT as a strategicbusiness function and the shift toindustry standard x86 servers, ITorganizations find themselves facingserver sprawl across their

infrastructure. Most of these serversare just 10-15% utilized, meaning ITorganizations are investing thousandsin an asset they barely use. IDCestimates that there is a 3-year excesssupply of server capacity in themarket, costing the industry $140billion.

Meanwhile, IT organizations need topower, cool, house, and manage allthese servers. With power costsincreasing, IT organizations arespending $0.50 in power and coolingfor every $1 spent on the server itself.This adds up to $29 billion in annual

cost industry-wide.

Plus, all those servers take space andspace is expensive. At a cost of$40,000 per rack to build a new datacenter, companies should be lookingfor any means possible to avoidexpansions or data center moves.

Finally, much of IT time is spent onmaintenance at a cost of 8 times thatof the server itself. IT organizationswould prefer to increase the server-to-admin ratio to reallocate valuabletalent to more strategic initiatives.


3/16

To deal with these problems,companies in every industry and ofevery size are turning to virtualization.Like ALSTOM, many companies seecost savings of at least 40 percent

from both lower server AND operatingcosts. For many more customerstories visit:http://www.vmware.com/customers/stories/

However, as analysts like Forresterobserve, the motivation for

undertaking a consolidation projectgoes further. Virtualization provides ITsignificantly greater flexibility to meetthe changing needs of their businesspartners.


4/16

Traditionally, organizations have run asingle operating system (OS) andapplication on each server, leading tothe server sprawl issues describedearlier.

Virtualization allows you toencapsulate each OS and applicationinto a software file(1) called a virtualmachine. Each virtual machine iscompletely hardware independent andcan be treated just like a file. It can bemoved around between servers,

copied, or run simultaneously on thesame server as other virtual machines.

Many VMware customers run 8, 10, ormore virtual machines for everyphysical server(2). This dramaticallyreduces the number of serversrequired to support an identical set of

workloads, leading to significantsavings, as youll see in the followingslides

Footnotes:(1) Technically, a VM is composed of a small set of files including the .VMX configuration file, the NVRAM BIOS image, and the .VMDK virtual disk

file.(2) The actual consolidation ratio depends on the specific applications, resource requirements of those applications, and server configurationincluding memory and number of CPU sockets


5/16


6/16

The most obvious benefit of serverconsolidation is the reduction in capitalinvested in hardware. In this example,the 1000 1 to 4 CPU servers wereconsolidated onto 80 2 to 8 CPU

systems over a 3 year period. Nettingout the investment in software andinfrastructure, the project saved a totalof $5.8M, or $5,816 per workload, or$5.3 Million in total.

Whether implemented during a serverrefresh or to contain future server

growth, the reduction in server costs isstriking.


7/16

Meanwhile, the cabling to support1,000 servers is a tangled mess. With3 network ports per server, thats3,000 ports and cables to buy and tomanage. Aside from the cost and risk

of an individual cable failing, theopportunity for human error isextremely high. Its difficult trying toidentify what cables go from whichswitch to which server. Imagine tryingto add a new server into this chaosand adding it correctly to the network?

After virtualization, each serveractually has more network cards (5versus 3), but the reduction in servercount is overwhelming. Total networkcables drop from 3000 down to 400,saving $296 per workload over 3years.

Data center space is also freed byvirtualization. Each server rack takesup valuable real estate in the datacenter. Moving from 200 racks downto 10 can save ~1750 sq ft(1). Giventhe high cost of leasing or buildingdata center space, an organization cansave or defer $430 for every workload

virtualized onto an existing server.

Footnotes:(1) Data center space does not decrease linearly with number of racks due to fixed overhead


8/16

Power ConsumptionProcessor power consumption hashistorically grown roughly in line withspeed increases. So as processorfrequency doubled every 18 months,power consumption grew. The electricity

bill is now a significant IT expense and onethat comes due every month. Someindustry analysts have noted:

Gartner Group says energy costs mayincrease from 10% of the IT budget todayto over 50% in the next few years Forrester says servers would use about30% of their peak electricity consumptionwhile siting idle IDC says the cost to power servers willexceed the cost of the servers by next year The U.S. Department of Energy statesthat data center energy usage can be 100times higher than those for a typicalcommercial building IDC calculates that the total power and

cooling bill for servers in the US stands ata whopping $14 billion a year, and if thecurrent trends persist, the bill is going torise to $50 billion by the end of the decade

At an average of 355W per serverworkload, consolidation saves $759 perworkload over 3 years.

Data Center CoolingMeanwhile, simple physics states that power consumed by the data center must be evacuated in the form of heat. Unfortunately, heat dissipation is very difficult, andeven more expensive than power consumption. IT organizations have responded with elaborate and often very expensive Data center design strategies, such as

raised floors and hot-aisle/cold-aisle configurations. Even so, airflow inefficiencies are the number one cause for x86 downtime and disk drive failure, the #2 cause, isheavily correlated with airflow inefficiencies.

Accounting for just the air conditioning costs, the average data center can save 444W per server workload, or $949, over 3 years.

Find out more about Energy Efficiency at: http://www.vmware.com/solutions/consolidation/green/


9/16

To summarize, the cost savings fromconsolidation with VMwareInfrastructure is compelling. Done ona moderate scale, the averagecompany can save $8,251 per

workload over 3 years. The typicalreturn on investment (ROI) for avirtualization project is 6 months orless. Virtualization projects pay forthemselves.

Note: These figures are all PERworkload. Multiply by number of

workloads to measure total savingsover 3 years. Examples:For 100 workloads virtualized, acompany saves $825,100For 1000 workloads virtualized, acompany saves $8,251,000


10/16

But capital and operating cost savingsare just the tip of the iceberg in thebenefits of virtualization. A secondmajor benefit is in simplifying the oftenarduous task of deploying new servers

and applications. Since virtualmachines are nothing but softwarefiles, they can be copied, pasted, andmoved around with the ease of a filecopy.

With virtualization, companies canprovision a new virtual machine with a

mouse click. This is a sea of changefrom the traditional model where ittypically takes days if not weeks ormonths to provision a new servers.Moreover, virtual machines can besaved as ready templates that can beinstantiated as needed. With thisinstant provisioning capability IT can

be responsive to the business likenever before.


11/16

Lets now compare the provisioningtasks in the physical versus the virtualworld. As an example, lets assumethe marketing department wants todeploy a new application that requires

a new server.

In the physical world, first IT workswith Marketing to determine thehardware requirements and then putsin an order for a new server from theirserver OEM. A week or two later, theserver arrives, and now it needs to be

racked, cabled, and configured a setof manual tasks. Next the OS isinstalled and configured. A new IPaddress is assigned and the systemsnetworking is configured. Only now,after 20-40 hours of actual labor and afew weeks of elapsed time is theserver ready for the application to be

installed. Meanwhile, all that humanintervention and manual processmeans the risk of error is high.

In the virtual world, its much simpler.A template already exists with the ITdepartments standard build. With afew mouse clicks, a new virtual

machine is copied from the Templateand deployed onto the virtualinfrastructure. Within minutes, itsready for application install. Theactual labor content is minimal at lessthan an hour and the lead time fromserver request to server delivery ismeasured in 1 or 2 days, not weeks.

Now IT is seen as a responsive, agilebusiness partner. Now IT looks good.


12/16

Instant provisioning simplifies the taskof deploying new applications.VMware Infrastructure also helpssimplify the ongoing management ofresources and service level for those

applications.

Since virtual machines are completelyhardware independent, virtualizationenables the live migration of virtualmachines from one physical box toanother without any end userinterruption. This ground-breaking

capability is known as VMotion, andwith the click of a mouse, applicationscan moved to a completely newhardware platform.

On top of VMotion comes policy-basedautomation with Distributed ResourceScheduler (DRS). This product

monitors virtual machine resourcerequests across multiple hosts,identifies capacity supply & demandmismatches, and uses VMotion todynamically reassign virtual machinesto new hosts. In this way, the virtualinfrastructure is able to dynamicallyand automatically load balance to

ensure every application is getting theresources it needs at exactly the righttime.

These tools provide IT organizations anew level of flexibility and automationthat greatly simplifies capacity andchange management.


13/16

The impact of VMotion and DistributedResource Scheduler are dramatic.

In 2 to 5 minutes, an application canbe moved to a higher performance

server, allowing the application toscale as demand increases. This is instark contrast to a traditionalenvironment, where reassigning anapplication to a new server takes 4 to6 hours of labor and requiresdowntime during the entire operation.Thus, IT organizations normally spend

days or weeks in change managementplanning and preparation. Withvirtualization, this becomesunnecessary. Reassigning a workloadbecomes a standard operation,allowing IT to manage capacity in amuch more flexible, fine-grained, andautomated manner.

Further, the flexibility of live migrationsfrees organizations from maintenancewindows. If IT needs to domaintenance on a server, they nolonger have to bring it down. They cansimply VMotion the virtual machines toother servers, fix the original server,

and VMotion the virtual machinesback. This is all completelytransparent to the end users andimposes zero downtime. Again, in thephysical world, this requires a 1 to 3hour maintenance period preceded bydays or weeks of change managementpreparation.

Thus, policy-based automation toolscan greatly simplify changemanagement and maintenance tasksfor IT personnel.


14/16

Freeing IT personnel from day-to-daymaintenance and break-fix means ITorganizations can finally dedicateresources to strategic projects. ManyIT organizations, such as this Fortune

100 company shown here, havehistorically dedicated 70%+ of theirproductive time to maintenance, eitherfor applications or the infrastructure.

With virtualization, that changesdramatically. By automatingprocesses and simplifying

infrastructure management, an ITorganization can dedicate more oftheir time to Innovation for theirInfrastructure (from 5% to 10%) andApplications (from 23% to 45%).

Thus, policy-based automation toolscan allow IT organizations to focus on

supporting business critical projectsand strategic improvements.


15/16

In summary, Consolidating serverswith VMware Infrastructure can: Save an organization $8,251 acrossserver and related hardware, powerand cooling, and data center space

Provisioning new applications isgreatly simplified by virtual machines;new services are as easy to deploy asa few mouse clicks Free IT from the manual tasks ofbalancing compute capacity to meetuncertain demand, or from running off-hour maintenance windows on

servers when VMotion and DRS makethis profoundly simple.


16/16

vmware's impact on business

Documents