EXECUTIVE SUMMARY .......................................................... 1 Basis for Analysis ........................................................................ 1 FINANCIAL OVERVIEW .......................................................... 2 Storage Environment .................................................................. 3 Physical Characteristics .............................................................. 4 THREE YEAR TCO DETAIL ANALYSIS .................................... 5 Hardware Costs .......................................................................... 5 Software Costs............................................................................ 5 Hardware Maintenance ............................................................... 6 Software Maintenance ................................................................ 6 Support Costs ............................................................................. 6 IMPACT OF UTILIZATION IMPROVEMENTS ................................ 8 CONCLUSION ...................................................................... 9 EXPLORE FOR YOURSELF .................................................... 9 ABOUT ALINEAN ................................................................ 10IBM Storwize V7000 – TCO White Paper iiiCopyright 2001-2010 Alinean, Inc. All Rights Reserved.
EXECUTIVE SUMMARYOrganizations needing a robust, scalable storage solution have typically had to deploy expensive enterprisestorage solutions that generated a relatively high cost per unit of business (cost per sale, for example) or ahybrid mix of assorted solutions from multiple vendors. While the hybrid approach may have been lessexpensive in terms of acquisition, the integration, functionality and ease of use were often the trade-offs.Many of these storage consumers may have smaller storage capacity needs or may be large enterpriseslooking to re-stage data closer to branches or distribution centers. Nevertheless, they all have the samestorage concerns and challenges as the largest enterprises.The differentiating value in storage systems today is rooted in sophisticated software functionality thatenables the ability to quickly implement, dynamically change, adapt, monitor and scale their data centers.The ability to cost-effectively package these storage management services in an easy-to-use offering leadsto real savings in hard costs, support and reductions in environmental requirements.In a survey conducted by IBM, the most important issues to storage consumers were mostly related to thefunctionality and support of data centers. High on the list were requirements for virtualized storage, thinprovisioning, backup to disk, deduplication, capacity planning and performance monitoring. The IBMStorwize V7000 Disk System is tailored to address these key issues and more.This paper examines the business case that was constructed to contrast the Total Cost of Ownership (TCO)of the IBM Storwize V7000 with a comparable competitive solution for a medium sized storage application.The financial assessment for this analysis compared the projected costs of upgrading an organization’scurrent storage infrastructure to support predicted growth over the next three, four and five years.Leveraging the virtualization and thin provisioning capabilities of the IBM Storwize V7000 enables utilizationimprovements of at least 30% and can reduce growth by up to 20% compared to the competitive solution.These benefits are key drivers for providing a robust, scalable, and manageable storage environment withsignificant savings over competitive alternatives.Basis for AnalysisIn order to compare the costs and benefits of the Storwize V7000 with competitive solutions, a typical clientconfiguration was constructed to generate cost and infrastructure requirements. Similar hardware andsoftware functionality available to both solutions were included in the analysis. Costs for the competitivesolution and the Storwize V7000 were both based on street pricing available to any purchaser (i.e. nospecial or one-time discounts). It was assumed that the workloads would be the same and the storagerequirements would consist of mostly unstructured data based in a single tier. The IBM Storwize V7000 iscapable of dynamically managing a multi-tier architecture, but for the purposes of this analysis, a single tierwas used.The following assumptions and constants were used for this analysis: Initial Storage Capacity (Raw TB) 20 Drive Size and Form Factor 600GB SAS SFF 10K HDD Annual Storage Growth 30% Annual Average Reduction in Drive Cost 15% NPV Rate 8% TCO Analysis Time Frame 3 YearHardware for both solutions was assumed to have a 36 month warranty and software had a 12 monthwarranty.IBM Storwize Solution – TCO White Paper 1Copyright 2001-2010 Alinean, Inc. All Rights Reserved.
FINANCIAL OVERVIEWThis organization has the potential to realize significant savings over a three, four or five year period byimplementing the IBM Storwize V7000. From a TCO perspective, the majority of the savings would comefrom a 30% reduction in initial storage investment by leveraging virtualization and thin storage provisioningand reducing annual storage growth. Additional savings are the result of the storage managementsoftware suite which is standard in the IBM Storwize V7000 and is priced per the number of storage chassisinstalled rather than the total storage or host server connections. This also significantly reduced theongoing annual software maintenance for this organization. Furthermore, these integrated software toolsenable this organization to support 43% more storage per storage administrator which also drives highersavings as capacity increases.The following table illustrates the costs of the IBM Storwize V7000 compared with the competing storagesolution over a three to five year TCO analysis based on a NPV discount rate of 8%. TCO Comparison 3 Year 4 Year 5 Year Competing Solution $488,208 $678,830 $901,681 IBM Storwize V7000 $269,233 $352,298 $464,194 Savings $218,975 $326,532 $437,487 Savings % 45% 48% 49%Over the three year analysis period, the software costs and software maintenance were reduced by about45% over the competing solution due to the Storwize V7000’s ability to contain the larger drives in thestandard 24 drive chassis and require fewer drives through virtualization and thin provisioning.IBM Storwize Solution – TCO White Paper 2Copyright 2001-2010 Alinean, Inc. All Rights Reserved.
Storage EnvironmentThe original storage infrastructure was that of a medium sized organization with 20 terabytes of rawphysical capacity with about 28% unused capacity. In the analysis, this organization was expecting storageto grow by about 30% per year, driven by a high demand in unstructured data.This organization also had the requirement to support ten Windows/Linux servers and five Unix servers inboth proposed storage configurations. It was assumed that the quantity of these servers would also growat the same rate as storage. The ability to support multiple server connections to these arrays withoutadditional cost figured significantly in the hardware savings of the IBM Storwize V7000. Totals By Year Year 1 Year 2 Year 3 Year 4 Year 5 Connected Servers Windows/Linux 10.0 13.0 17.0 22.0 29.0 Unix 5.0 7.0 9.0 12.0 16.0 Competing Solution Physical Raw Storage (TB) 20.0 26.0 33.8 43.9 57.1 Number of Drives 36.0 46.0 59.0 76.0 99.0 IBM Storwize V7000 Physical Raw Storage (TB) 14.0 17.4 21.5 26.7 33.1 Number of Drives 25.0 31.0 38.0 47.0 58.0The predicted increase in storage capacity was expected to grow from 20 TB in the first year to nearly 34TB over the three year analysis period and more than 57 TB at the end of five years for the competingstorage solution. Conversely, it was determined that with the integrated virtualization and thin provisioningcapability in the Storwize V7000, the initial raw capacity could be reduced by 30% to about 14 TB.Furthermore, by driving higher storage utilization with virtualization and thin provisioning, the organization’sstorage estimated growth rate could be further reduced to about 24% CAGR (Compounded Annual GrowthRate). Based on these factors, the Storwize V7000 would grow to only 21.5 TB by the end of year threeIBM Storwize Solution – TCO White Paper 3Copyright 2001-2010 Alinean, Inc. All Rights Reserved.
and to just over the 33 TB by year five. These results suggest that the Storwize V7000 could effectivelysuspend realized storage growth and push additional storage acquisitions out into subsequent yearsthereby leveraging the value of the annual decline in drive prices.Physical CharacteristicsThe IBM Storwize V7000 is designed to provide a large amount of storage capacity in a small,environmentally friendly footprint. The IBM Storwize V7000 begins with a single control enclosure housingdual controllers and 12 – 3.5” or 24 – 2.5” drive bays in a 2U chassis. The control enclosure contains eightFibre Channel and four iSCSI ports per controller pair.Up to nine expansions disk enclosures may be added, each of these housing either 12 or 24 drive bays.These expansion enclosures can be mixed to provide more flexibility for the client’s storage environment. Afully populated Storwize V7000 system can contain up to 240 drives with a maximum of 240TB of rawphysical storage capacity.A variety of disk types, performance characteristics and sizes may be installed in the array providing theability to achieve multi-level tiering within the same enclosures.The rack space required for the IBM Storwize V7000 is one-half to one-third the space required by thecompetitive solution and operates on less power. Lower overall storage requirements translated intosignificant reductions in the number of drives required each year, which reduced maintenance costs. Withthe competing solution, the number of drives grew from 36 drives to 99 drives over a five year period whilethe Storwize V7000 grew from 25 drives to 58 drives over the same period.IBM Storwize Solution – TCO White Paper 4Copyright 2001-2010 Alinean, Inc. All Rights Reserved.
THREE YEAR TCO DETAIL ANALYSISThe IBM Storwize V7000 compared favorably to the competitive storage solution over a three, four and fiveyear period, but in today’s economy many organizations are looking to generate a positive ROI in threeyears or less. The IBM Storwize V7000 generated a quantifiable saving in almost every TCO category asillustrated in the table below: IBM Competing Storwize 3 Year Detail Solution V7000 Savings Savings % Hardware Costs $140,346 $73,890 $66,456 47% Software Costs $99,736 $36,000 $63,736 64% HW Maintenance $0 $0 $0 0% SW Maintenance $35,043 $13,481 $21,562 62% Support Costs $200,247 $133,026 $67,221 34% Data center Space Costs $12,836 $12,836 $0 0% Total Cost $488,208 $269,233 $218,975 45%Note: Costs are based on a Net Present Value (NPV) of 8% over three years.Hardware Costs Competing Solution Year 1 Year 2 Year 3 Hardware Costs $89,398 $27,606 $29,611 IBM Storwize V7000 Year 1 Year 2 Year 3 Hardware Costs $62,483 $6,422 $6,369Note: Does not reflect discounted cash flow.The IBM Storwize V7000 realized a savings of $66,546 (NPV) over the three year analysis period largelybased on the reduced number of drives required for growth and the space allocation savings gainedthrough virtualization and thin provisioning leading to higher utilization. Additionally, the Storwize V7000’sability to house more drives with higher capacities allows this organization to defer chassis upgrades untilthe drive bay capacity or performance thresholds have been reached, thereby postponing those hardwarecosts until required.Software Costs Competing Solution Year 1 Year 2 Year 3 Software Costs $65,460 $18,500 $20,000 IBM Storwize V7000 Year 1 Year 2 Year 3 Software Costs $36,000 $0 $0Note: Does not reflect discounted cash flow.The potential savings in software costs were the most significant in this three year analysis, generating asavings of $63,736 (NPV). The IBM Storwize V7000 is simply priced at $18,000 per chassis for theintegrated suite of tools, as opposed to the competitive solution which is based on licensing for eachcomponent of storage management with pricing varying by the storage model. As a standard offering, theStorwize V7000 includes functionality for virtualization and thin provisioning, Easy Tier SSD Management,IBM Storwize Solution – TCO White Paper 5Copyright 2001-2010 Alinean, Inc. All Rights Reserved.
transparent data movement, local mirroring, FlashCopy and a robust GUI storage management consoledesigned for ease-of-use and flexibility. Optional features include FlashCopy Management, performanceoptimization, remote mirroring, external storage virtualization, automatic disaster response and automatedfall-back.The competitive solution also levies a hefty fee for each server connection to the array, which is standard inthe Storwize V7000.Hardware Maintenance Competing Solution Year 1 Year 2 Year 3 Year 4 Year 5 HW Maintenance $0 $0 $0 $26,787 $32,110 IBM Storwize V7000 Year 1 Year 2 Year 3 Year 4 Year 5 HW Maintenance $0 $0 $0 $12,335 $14,320Note: Does not reflect discounted cash flow.There were no savings in hardware maintenance for either storage solution in the three year analysis asboth included a 36 month warranty for standard 9 to 5 support. However, after five years, the savingshere would be $24,548 (NPV) or a 55% saving over the competitive solution. This is the result of reducedhardware costs for the Storwize V7000’s smaller, upgradable chassis and fewer disk drives due to higherutilization.Software Maintenance Competing Solution Year 1 Year 2 Year 3 SW Maintenance $0 $17,632 $21,832 IBM Storwize V7000 Year 1 Year 2 Year 3 SW Maintenance $0 $7,560 $7,560Note: Does not reflect discounted cash flow.Software maintenance costs were calculated at 21% of the current software cost over the three yearanalysis. The IBM Storwize V7000’s software pricing, based on the type and number of chassis required, asopposed to a pricing scale based on the initial base model and upgrades, provides integrated storageconsole management at lower initial and annual price points. These software purchase savings lead tosignificant reductions in annual software maintenance costs. Furthermore, the Storwize V7000’s ability toleverage more, higher-capacity drives without chassis upgrades directly influences significant savings insoftware maintenance costs.Support Costs Competing Solution Year 1 Year 2 Year 3 Support Costs $54,823 $71,270 $92,651 IBM Storwize V7000 Year 1 Year 2 Year 3 Support Costs $38,376 $47,586 $59,007Note: Does not reflect discounted cash flow.The powerful suite of software tools included in the IBM Storwize V7000 enables the support of greaterquantities of storage with fewer support resources. The Storwize V7000 Management Console includesmany features to automatically identify and take action on storage events that might otherwise requirehands-on attention or might have been missed entirely. While the competing solution offers many of thesame abilities, it may require the usage of more than one software tool and may not truly be able topresent a single pane of glass to the storage administrator.IBM Storwize Solution – TCO White Paper 6Copyright 2001-2010 Alinean, Inc. All Rights Reserved.
Additionally, thin provisioning relieves storage administrators from constant monitoring of real or virtualvolumes and spending time resolving issues caused by space limitations. Virtualization enables fast andeasy creation of virtual volumes which improves the ability of IT to respond to storage needs. Lastly, theStorwize V7000 offers a no-charge limited time use of virtualized external storage functionality formigration. This ability provides fast and non-disruptive migration from existing storage to the StorwizeV7000 arrays, saving significant time in planning, migration and service interruption.IBM Storwize Solution – TCO White Paper 7Copyright 2001-2010 Alinean, Inc. All Rights Reserved.
IMPACT OF UTILIZATION IMPROVEMENTSOne of the most daunting tasks for IT is the management of storage growth and driving higher utilization.Every unused TB of free space and allocated-but-unused space represents storage that IT pays for andsupports but gets no use of. However, cyclical demand, lengthy procurement cycles and businessinterruption avoidance require the staging of unused space. Storage systems that provide virtualization andthin provisioning give the data center the tools they need to greatly reduce the amount of underutilizedspace while maintaining service levels for daily and cyclical demand.One of the most significant features of the IBM Storwize V7000 is the utilization improvement over andabove what the competing solution can deliver. Virtualization and thin provisioning, managed andautomated though a single pane of glass, are integral parts of the Storwize V7000 and help achieve thegoal of better storage utilization. The following analysis takes a closer look at the impact of utilizationimprovement by comparing the IBM Storwize V7000 to itself with and without the improvement inutilization. This approach filters out all other cost benefit factors and illustrates the impact of improvedstorage utilization alone. IBM Storwize V7000 W/O IBM Utilization Storwize Savings 3 Year Detail Improvement V7000 Savings % Hardware Costs $85,906 $73,890 $12,016 14% Software Costs $36,000 $36,000 $0 0% HW Maintenance $0 $0 $0 0% SW Maintenance $13,481 $13,481 $0 0% Support Costs $173,399 $133,026 $40,373 23% Data center Space Costs $12,836 $12,836 $0 0% Total Cost $321,622 $269,233 $52,389 16%Overall savings are estimated to be $52,389 (NPV) or 16% over a three year period solely fromimplementation of the virtualization and thin provisioning features of the IBM Storwize V7000. Without theadditional utilization improvement, hardware costs would be 14% higher for the same solution. Becausethe Storwize V7000 has the ability to store 24 SFF drives in a single chassis, an additional chassis is notneeded until year five which keeps the software and maintenance costs flat until then. These costs caneffectively be deferred until then and represent a 22% savings in software, 21% savings in hardwaremaintenance, and 17% savings in software maintenance.Storage support costs also increase as storage is not as effectively managed without the IBM StorwizeV7000 utilization improvement functionality. More drives also marginally increase the power and coolingrequirements as well.IBM Storwize Solution – TCO White Paper 8Copyright 2001-2010 Alinean, Inc. All Rights Reserved.
CONCLUSIONStorage is growing at an ever increasing rate and there is no sign of that trend slowing down or reversing.As more information becomes available and new regulations require the capture and storage ofinformation, the appetite for storage will remain voracious. The best hope for storage consumers is toacquire the technology and infrastructure to effectively manage that growth. The ability of the data centerto leverage thin and virtual provisioning is not just a nice feature to have. Without it there is no way for thedata center to keep up with the increasing business demand they support, at least not in any reasonable,cost effective way.Another fundamental challenge for storage consumers is finding storage solutions that allow them to scaletheir data center without buying hardware they may not need. While adding capacity may bestraightforward in most storage configurations, adding ports and controllers may require the purchase ofanother array frame, taking up more floor space and adding to environmental costs.The IBM Storwize V7000 gives clients the ability to add the type of storage functionality they need at thetime they need it. For performance sensitive applications, additional controller pairs may be dynamicallyadded to increase the throughput by providing additional ports. Since the controller enclosure can alsohouse drives, the client can also add capacity at the same time. If additional capacity is needed instead ofthroughput, then disk enclosures can be added to increase capacity.This case study illustrates how these factors impact the growth, cost, support and management of datacenters. The IBM Storwize V7000 offers a robust, scalable and cost effective platform to deliver enterpriselevel storage architecture and functionality to the medium sized storage consumer. Savings over thecompetitive solution were shown to have ranged from 45% to 49% over three to five years, resulting in netsavings of $218,975 to $437,487 over the same period.EXPLORE FOR YOURSELFAs illustrated in this case study, the IBM Storwize V7000 offers significant opportunities for reducingstorage acquisition and operation costs, reducing data center space and energy consumption. Alinean hasdeveloped an easy to use Storage Consolidation TCO Calculator that will allow you to explore thesepotential savings for your unique environment. Learn how you can achieve similar benefits by trying thecalculator at: https://roianalyst.alinean.com/stg/IBM Storwize Solution – TCO White Paper 9Copyright 2001-2010 Alinean, Inc. All Rights Reserved.
ABOUT ALINEANSince 1994, the Alinean team has been the pioneering builder of tools to help quantify and improve the ROIand TCO of IT investments. Alinean was named for the Spanish word for “Align”, matching the Alineanmission as the leading developer of analytical tools to help IT vendors, consultants and IT executives alignIT investments with business strategies.The Alinean team has over a decade of experience in the practical development and application of ROI andTCO methodologies, models and tools to optimizing IT investment decision making. In 1994, the Alineanteam formed Interpose, the original pioneers of ROI tools, developing analytical software for over 50 majorIT vendors and consulting companies worldwide, and creating the industry standard TCO Manager and TCOAnalyst software. Interpose was sold to Gartner in 1998, where the team continued their developments andmarketing of ROI and TCO software tools. The original team reunited to form Alinean in 2001, once againbecoming the leading pioneers and developers of ROI sales and analytical tools. Current customers includeleading IT solution providers such as HP, IBM, Dell, Intel, Symantec, NetIQ, EMC, SAP, Oracle, SBC, andMicrosoft, as well as leading consultancies and Global 1000 companies.Additional information about Alinean and helpful ROI educational resources can be found athttp://www.alinean.com.IBM Storwize Solution – TCO White Paper 10Copyright 2001-2010 Alinean, Inc. All Rights Reserved.