Thanks for sharing your thoughts. I will really appreciate if you have any reference for cost distribution for small scale datacenters. Thanks James, great analysis. Cell phones alone have really been getting more resources fast and a pretty average phone these days is a 4-core and many are 8-core 64bit systems. ): 20% Data Center Build vs Buy Calculator. Others take a middle ground and work directly with original design manufacturers (ODMs)to have custom designs built and delivered. The Amazon EC2 charge model is at: http://aws.amazon.com/ec2/, 9-17-2017 does this look right? For example, in this model we’re using a Power Usage Efficiency (PUE) of 1.45 but Google, for example, reports PUE across the fleet of under 1.2: Data Center Efficiency Measurements. And, small scale infrastructure like wiring closest are often poorly designed and inefficient. It’s getting super hard to characterize power draw and few want to talk about it but 12 to 15kva racks are pretty common, storage racks run less, and there are some designs that are much higher. Servers dominate with mechanical systems and power distribution close behind. Most workloads run on more expensive servers. On average, a 50-cabinet data center will occupy about 1,700 square feet. At the low end, all providers have efficient 2-way x86 servers. This approach allows us to compare non-comparable costs such as data center infrastructure with servers and networking gear each with different lifetimes. 3) power distribution: 10% (18%) If you do the math a data center buildout of a three-tier application (web servers, middle tier, load balancers, SAN) comes out to be much more expensive than a more or less identical, non-optimized configuration in IaaS (minus the SAN) — about half in my model — and with RI’s and some smart optimization you can get the cloud costs really quite small. Although some people who say "power is the dominant cost" are still optimizing for space consumption. The cost of a data center's power and cooling typically is more than the cost of the IT equipment inside it, experts say. Late last year I updated the model for two reasons: 1) there has been considerable infrastructure innovation over the last couple of years and costs have changed dramatically during that period and 2) because of the importance of networking gear to the cost model, I factor out networking from overall IT costs. Where’s the bulk of the money going? By using an outsourcer's hardened data center, your are protecting your systems from critical downtime. P.S. The state of the art has evolved a lot since that time and I’m out of touch with current state of the market pricing since, in the work I’m involved with, it’s all special very high volume pricing. What server utilization does that assume? When they say that "power is the dominant cost", could it be that folks are somehwat confused and are really pointing at the fact that power is now the bounding resource in the data center (as opposed to, say, space)? Compare this pricing to an outsource data center: $850 per rack per month plus … including capital, engineering, installation, and operating cost data for the various elements of physical data center or network room infrastructure, as well as design-related parameters such as sq. At scale, hardware administration, security, and other infrastructure-related people costs disappear into the single digits with the very best services down in the 3% range. Alex architected Lifeline’s proprietary GRCA system and is hands-on every day in the data center. When you have millions of servers, is 10s of data centers all of the world you can justify and pay for a very high quality security team. It turns out that power is incredibly important but it’s not the utility kWh charge that makes power important. When billing for compute usage by the hour, we are very motivated to reduce energy consumption since it direct reduces are costs. Data centers can employ AI to reduce their operating costs through energy conservation, which is a common goal for all data centers. Considering telecom operators going to establish edge clouds inside their core network, it would interesting to see the significant constituents of opex and capex cost. The cost and efficiency of power distribution hasn’t changed greatly since that time. In the model below, I normalize all costs to a monthly bill by taking consumable like power and billing them monthly by consumption and taking capital expenses like servers, networking or datacenter infrastructure, and amortizing over their useful lifetime using a 5% cost of money and, again, billing monthly. The law of supply and demand would escalate costs very quickly. If the data center is too big, the cost … It’s been too long since I was working with these data and the scale we are currently operating at gives some economies of scale in some dimensions that don’t easily apply elsewhere. The reason you havne’t found the revenue model thus far is that its really very application and use specific. A data center of the size that Facebook or Google might use would cost from $250 million to $500 million. I’m pretty confident and, for the most part, most customers and perspective customers are there as well. Your email address will not be published. The server chosen for this model is very low cost commodity server that would support a highly parallel workload like internet search well. On opex, converged systems can increase utilization and utilization is a massively powerful cost lever. The key point to keep in mind is the amortization periods are completely different. As a consequence, this is where I spend a considerable amount of my time – perhaps the majority – but we have to remember that servers still dominate the overall capital cost. AI and Data Center Energy Conservation Maintain ing a data center is expensive, and much of the cost management burden falls on data center facility managers and opera tors. Data mining and analytic systems have always scaled with cost. Like any other TCO analysis… Download our Lifeline Data Centers One Sheet. What kind of advantages are associated with colocation that you don’t get with building a data center? Are you wondering how much it will take to build your own data center or are you unsure if you have everything accounted for in your construction budget? If you choose to use this spreadsheet directly or the data above, please reference the source and include the URL to this pointing. This doesn’t include admin staff costs. Your question used to be common but, over the last 5+ years or so, security at major cloud operators has largely been acknowledged to be amoungst the best in the world. Frank, I agree, the outside-the-box infrastructure including wan infrastructure, net gear, wiring closets, and client devices consumes more power than the data centers on which the depend. Can you explain me what kind of pricing model should be applied for green datacenters? various reports are suggesting that telco operators are looking into CRAN (Centralized) and DRAN (Decentralized Radio Access Network) solutions. Administrative costs are not included for the same reason. From the year 2000 to 2006, data center … If so what next! The billing model I like is, predictably based upon where I work, the Amazon pay-for-what-you-use model. Most of the big operators will be operating at efficiency levels far beyond those used here. One of the reasons I posted it was to debunk the often repeated phrase “power is the dominate cost in a large-scale data center”. Measured this way, power is the second most important cost. 9-13-2017 Thanks for the impressive feed back. Sense technology seems to be moving toward the size of a pin head will the virtual world become saturated?? Your articles are absolute genius.Great enlightenment! For individual facilities, Data Centers E, F, and J are all operating with a TTM PUE of 1.11, while only Data Center J operated at a TTM PUE of 1.12 in 2010. Now sure how the server power, PUE overhead, networking cost will vary. 2) Net gear: 9% (8%) Again, the spread sheet source is attached below so feel free to change to the PUE used by the model as appropriate. Any insight will be greatly appreciated! I suppose if you were previously spending way too much on storage, a converged system might help. how “smart” data center design can lower total d ata center operating costs, and the report concludes with a summary of key results in Chapter 6. Also having a backup datacenter at a central location (or extension offices as you called) could help in scaling to meet the capacity requirement. Serverless Computing, Elastic Compute Cloud are showing promising innovations! Looking for a provider? x watt at average utilization) to assume for a server deployed by the major cloud operators? Total Cost (Cluster Level), Total Cost (vCenter … We’re doing custom gear with all major components directly sourced from suppliers so I don’t have a good window into the OEM server market BOMs at this point. Several server manufacturers design and build servers specifically for the mega-facility operators often in response to a specific request for proposals (semi-custom builds). This makes it an reasonable scale facility –big enough to enjoy the benefits of scale but nowhere close to the biggest data centers. Mechanical system costs have come down quite a bit and overall data center efficiency has improved substantially since that time. Acorns, Bond Linc, lenda. The big operators tend not to discuss their equipment in much detail but this paper has a fair amount of detail: http://research.microsoft.com/pubs/131487/kansal_ServerEngineering.pdf. Or does that reflect the depreciation on the servers? I would likely lease it out. I guess the cost will also impact the network architecture, e.g. Its just really hard to offer general rules on revenue. In a cloud service, the IT problem is the entire problem and customer trust is very dependent upon the security of the solution. You what is your experience with Dell C6100 and HP Z6000 with 2x170h 6G servers? The data here is everything below the O/S so doesn’t include people and doesn’t include software licensing. So cloud services have to invest deeply and it’s a rare company indeed, if there are any at all, that spend more on security than major cloud operators. Pretty amazing. When I redo these data, I keep the facility server count in the 45,000 to 50,000 server range. because this will reduce the electricity consumption and as a result reduce the revenue of a datacenter company. http://software.intel.com/sites/datacentermanager/faqs.php. Use this calculator to see what it really takes to build out a Tier 1, Tier 2, Tier 3 or Tier 4 data center. Once you are out of the cell towers, space and power problems can be solved and, if the services are successful, they will achieve scale. Hello James, very interesting article. Essentially, it models what was possible using the best ideas available at the time but not innovating, doing anything radical, or pushing the state of the art. But, for non-technical reasons, supply could be very constrained and from a single provider and prices could be a large multiple of actual costs. I am trying to reconcile the per server power consumption from this post. Do you see use of HyperConverged systems can bring down Datacenter Capex & Opex ?? The short answer is: select servers carefully and buy in very large quantity. Would servers become less of a cost vis-a-vis networking? Jonathan, I would equally like to see a fully-burdened ‘infrastrucutre’ cost breakdown, as well, beyond that which takes into account only the fully-burdened power and other areas in your analysis. Give Lifeline Data Centers a call at 317.4523.2591. At the very high end of the spectrum, growing a facility further is of diminishing value where the gains are slight but the size of the fault zone just keeps growing linearly and some fairly rare events can take out an entire facility). One item that might change these calcs. The real cost of operating your data center. Second, you suggest that servers account for 57% of the Capex. Cooling is another 18 KW/hr for a total of $1167 per month. At a median cost of $8 per square foot, the space alone would cost about $13,600 per month. This goes back quite a few years so the data is getting a bit dated. Yet in small businesses, the cost of the data center's electrical power is rarely assigned to the IT department. What spec server are you using that comes out to $1450/165 watts? The difference is much starker if you compare the smallest data centers to the largest ones. Subscribe to the Data Center News Digest! Also micro services based virtual 5G functions will motivate operators to chose cots hardware. Equinix highlights the value of interconnects, multi- and hybrid-cloud deployments. Or they could decide “for the good of the network” to only connect Telco X branch extension offices directly and all non-Telco X extension offices might only be allowed to connect through the central network. The solution is to put large facilities near to these so they can grow and there aren’t shortages of power and floor space. Wayne, in your comment you mentioned that brick and mortar facilities are normally amortized over 27 to 30 years and this could lead to "IT and overall power consumption being a larger portion". There is no question that small facilities are more expensive but it’s far from linear. Land, core and shell: 20% By the way I’ve been playing with your spreadsheet a bit — trying to come up with a cost/server from a different angle, using a $1200/sqft baseline for the data center (found that somewhere), assuming 25 sqft/rack, etc. HI James, it’s been a long time since IBM/Lotus and MS. 1.4 Nomenclature Excellent post thanks. We are consuming far more power per server today. This space has great potential to escalate in costs rapidly. A couple of years ago, I did a detailed look at where the costs are in a modern , high-scale data center. EPA Report to Congress on Server and Data Center Energy Efficiency completed in 2007 estimates that data centers in USA consume 1.5 percent of the total USA electricity consumption for a cost of $4.5 billion [7]. Thanks. Even network neutrality won’t fully solve this potential issue. Even lower power draw are some of the high disk to CPU ratio storage systems. As I suspect you know, the challenge is the current rate of change. Learn how your comment data is processed. ... they could have an impact on the overall cost-benefit analysis of cloud services. 5) Other: 2% (4%), Using a 30 year amortization has a dramatic impact on overall costs but the change in percentages is less dramatic. Want a quick look at what we do and who we are? Hi James. I’ve frequently heard “how can the facility cost more than the servers in the facility – it just doesn’t make sense.” I don’t know whether or not it makes sense but it actually is not true at this point. Power efficiency is highly leveraged when looking at overall data center costs, it plays an important role in environmental stewardship, and it is one of the areas where substantial gains continue to look quite attainable. Thanks James. 4 Total Cost of Operating and Running a Data Center 21 4.1 Personnel & Software Costs 21 4.1.1 Personnel per Rack 21 4.1.2 Depreciation of IT Equipment 21 4.1.3 Software and Licensing Costs 22 4.2 Total Cost for Hosting an Industry Standard High Performance Rack 22 5 Key to Cost Effective “Smart” Data Center … Numbers come out similar to yours. If its in the San Francisco/Silicon Valley area, it’s less valuable but it’ll still move very quickly. Both of these areas have proven to be important technology areas to focus upon and there has been considerable industry-wide innovation particularly in cooling efficiency over the last couple of years. First of all, great analysis, really impressive giving birth to cyborgs while worshiping pagan gods. Many applications of compute have nothing directly to do with consumers and scale with declining costs. Total fixed data center costs before maintenance before maintenance is between $4,046 - $6,100 per month. I posted the original model at the Cost of Power in Large-Scale Data Centers. What is the breakdown between the servers components: CPU, Disks, Memory etc. ... [capital expenditures and operating expenditures]. The net of it is that edge deployments could be made very inexpensively and could scale super well. CDC-CAP Cost, CDC-CAPX Cost, CDC-total OPEX, Total Cost (Cluster Level), Total Cost (vCenter Level) will have the object type Custom Datacenter. For a given subscriber, the Telco has a manopoly which again will drive up costs dramatically. The reason why the cloud transition is happening so quickly is the combination of better economics and the ability to move far faster and to try new ideas more quick, make the cloud a pretty obvious win. demands that specially-designed space enclosures be used. Approximately $525 per month is for the servers and communications equipment. Our building is located in Toronto, Canada. we can observe many companies that run data center generate arround 20% of profits on reinvoicing the peak electricity consumption to their clients. The idea of using a Midwest colocation provider may be the right choice for your business. Most in the industry are really not talking about the absolute edge of the cellular infrastructure network when they are talking about the edge and how 5G can support network function virtualization. This Data Center Knowledge Executive Guide Series of articles will examine the many aspects of TCO, such as energy costs and operating efficiency, as well as other data center specific issues. These are the assumptions used by this year’s model: Using these assumptions we get the following cost structure: For those of you interested in playing with different assumptions, the spreadsheet source is here: http://mvdirona.com/jrh/TalksAndPapers/PerspectivesDataCenterCostAndPower.xls. It becomes especially germane in smaller data centers and other small venues, such as LAN equipment closets, comms centers and the smaller server farms, where I devote a great deal of my time and focus on bringing new efficiencies. Even well run medium-sized deployments get under 10% of overall costs and I’ve seen them as low as 3%. How have these costs changed in 2017? 1) You used 165 W per server. Yet, when viewed as a function of total "actual" costs to the enterprise, real estate (and power) comprise a large share of ‘fully burdened infrastructure costs’ on a par with big-box data centers, although it’s far more difficult to get an accurate picture and characterize quantitatively all of the millions of smaller enclosures that exist today. When server and other IT equipment capital costs are directly compared with data center capital costs, the data center portion actually is larger. feet per … The primary motivation behind bringing all the costs together was to understand where the problems are and find those easiest to address. Roughly 300 racks at 10kW a rack. I referred to this as fully burdened power. Does that reflect the capital expense of purchasing new servers? Whatever model is chosen, enterprises should consider key costs involved with building, operating and maintaining a data center. Try using higher numbers like $2,500/server and 250W/server in the spreadsheet. Feature. For the sake of argument, we can start with a figure of $1,000 per square foot. Servers were at the time, on average, more powerful and more expensive. cost-of-data-center-outages This ebook describes a balanced critical facility management program and mindset with 12 essential program elements, while providing practical tips and advice throughout. For the customers you are looking at buying commercial networking gear and servers, I suspect networking cost ratios have stayed roughly the same. This may lead to initial overbuilds that adds to the bill: additional capital, infrastructure, and energy consumption costs. At scale, all the above work and will deliver products at these price and power points. We calculate operating cost as $52.279 billion (COS) + $8.685 billion (OPEX). The model includes all costs “below the operating system” but doesn’t include software licensing costs mostly because open source is dominant in high scale centers and partly because licensing costs very can vary so widely. The average annual data center cost per kW ranges from $5,467 for data centers larger than 50,000 square feet to $26,495 … On projects with which I’ve been involved, they are insignificantly small so don’t influence my thinking much. This is easy to do and they could be quite inexpensive to scale. Essentially, they won’t be “small” facilities. Generally, at scale, admin costs round to zero. QUARTER 01 QUARTER 02 what is your experience with Intel intelligent power node manager Extension offices, as defined above is a nice solution to scaling the edge of a telco network. Many of the advantages of the cloud are driven by scale. My apologies, James, for my earlier misrepresentation of your name. These include but are not limited to: real estate and facility costs, critical infrastructure costs, staffing costs, opportunity costs and additional operating costs. In 2016, the Data Center Optimization Initiative (DCOI) told federal agencies to reduce the costs of physical data centers by … Your right, technology continues to improve but our appetite for compute continues to increase faster. IT costs declining drives demand up. If the cost of compute falls as it continues to do, then more tasks make economic sense. Measured this way, power is the second most important cost. Would you please clarify? b: http://blog.mvdirona.com / http://perspectives.mvdirona.com. Telecom “edge” deployment costs vary on the definition of the edge. The cell towers lack the power and space for a successful compute service nothing that achieves scale will be housed there. $200 to $250. That’s a massive large single failure zone. therefore datacenter companies aren’t interested in creating green datacenters, optimizing all factors such have energy efficient servers, PDU’s, cooling systems a.s.o. quite a lot (and make IT and overall power consumption a much large portion) is that the bricks and mortar actually have to be amortized (as required by tax laws) at between 27 and 30 years (not 10 to 15). For a small business in Indianapolis with: electrical usage is roughly 9 KW/hr. This helps us understand the impact of networking on overall capital cost and on IT power. Energy Efficiency. Custom portable solid state TB vs disc-as-needed=lower energy CPU-less constant over heat-less utility dependence A few suppliers are experimenting with single socket ARM servers. Your email address will not be published. What are the real costs of operating your enterprise data center? The challenge here is highly heterogeneous enterprise datacenters with a small number of many different applications can have very high admin costs. Alex also manages relationships with the telecommunications providers and has an extensive background in IT infrastructure support, database administration and software design and development. Download it now! Approximately $525 per month is for the servers and communications equipment. To me, the “edge” is a cell tower and cell tower floor space and power is in very tight supply. Let’s call these extension offices. This might … ... the life-cycle cost of data can be really high," Alvarez says. Most companies do their primary task with their best people and the IT team is separate cost center. Things are improving so fast, I suspect the residual value of a 10+ year old facility won’t be all that high. I could imagine the infrastructure costs one day eclipsing those of servers as server costs continue to decrease but we’re not there yet. Flexible – additional capacity can be scaled up as needed, no wasted extra capacity or build outs needed 3. Power efficiency is highly leveraged when looking at overall data center costs, it plays an important role in environmental stewardship, and it is … What would I do with an incredibly well connected 3MW downtown? U.S. government data centers are feeling the pinch. The electrical power needed to maintain an enterprise data center continues to increase. Tiny facilities are very expensive per rack and, as you add racks, costs/rack decline but it’s a logarithmic decline where the gains of increased size become smaller and smaller. There has been a lot of innovation over the last 8 years so the model is getting a bit out of date and the workload targeted at the time was a highly parallel workload that ran well on fairly weak, inexpensive, commodity servers. The reason why I’ve moved from a 15 year amortization for infrastructure to a 10 year is the current rate of change. I hear you James and you are right those numbers are quite good. Also, what about bandwidth costs/security/hardware replacement (or is that bundled in to your assumptions above?). It’s messy to answer definitively. We now have IT costs with servers and storage modeled separately from networking. Keep in mind, I’m only modeling those techniques well understood and reasonably broadly accepted as good quality data center design practices. More predictable expenditure model with costs that increase consistently over the life of the data center 2. I haven’t seen anything specific on the cost disadvantage of small facilities but I suspect these are very big opportunities and the end capacity levels will need to be very large. Pardon me if this is off topic (I do mean that), I am also curious to know what you personally would do with a vacant building in a downtown core location that has ~3MW of utility power and an abundance of diverse bandwidth…? 165 W at x% utilization) hold true today at major cloud operators? what would you estimate for a breakdown of DC capex? Do you have a sense of how costs have shifted since you wrote this? per rack. The server costs fraction grows under these assumptions to 61%. The subject of real estate is usually treated as a ‘facilities’ based problem, and as such it is not one that IT generally gets involved in justifying, but so too was power treated in this manner at one time. Mission Critical Magazine | Data Centers & Critical Facilities A 1980 DC isn’t worth much. Power infrastructure: 20% Although each data center is a little different, the average cost per year to operate a large data center is usually between $10 million to $25 million. A 1,000 square ft. data center would then cost $1 million, on that basis. I know at AWS it’s our #1 focus and nothing gets prioritized ahead of security. First off, excellent article, I found it very insightful. While enterprise … The costs modeled include both the cost of operations and the cost of acquisition and models a 3 year life for servers, 5 year life for networking gear, and 10 year life for data center power and cooling infrastructure. What you pay the data center is separate from the equipment you house there. A useful budget should not only include the initial capital expenditures, but should extend out into the lifespan of the data center to reflect operating expenditures. Operating costs were $60.964 billion for the period. A life cycle of 10 or more years is expected when building a single tenant data center. $1000 to $2500. Doing some research on comparing data center costs to cloud costs and came across this blog entry, which is terrific, and my sense is it holds up pretty well over the years. per month. Networking costs have fallen dramatically with several of the big operators turning to custom networking equipment but, at the same time, the networking to processor ratio has sky rocketed.

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