Total Cost of Ownership webinar

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Do you know how much you’re really spending to host your own ad server? It may surprise you. Watch this webinar to learn more about the ‘hard’ and 'hidden' costs associated with self-hosting.

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Total Cost of Ownership webinar

  1. 1. Total cost of ownership How much are you really spending to host your ad server? Presented by Alexander Dean, Principle, Keplar, LLP Twitter Hashtag: #OXwebinar
  2. 2. Total cost of ownership (TCO) <ul><li>What is required to host your own ad server? </li></ul><ul><li>What is the true cost of hosting your own ad server? </li></ul><ul><li>How does this cost compare to a fully hosted solution such as OpenX Enterprise? </li></ul>09/30/11 Total cost of ownership #OXwebinar
  3. 3. We cover three distinct TCO comparisons, each one focusing on a different-sized publisher 09/30/11 Size of publisher Self-hosted ad server Hosted ad server Impression range vs Small, regional OpenX Source OpenX Enterprise 50m-500m Medium, regional DART Enterprise OpenX Enterprise 200m-1bn Large, multi-regional DART Enterprise OpenX Enterprise 500m-5bn Total cost of ownership #OXwebinar
  4. 4. Anatomy of a self-hosted ad server <ul><li>There are three key building blocks to hosting your own ad server: </li></ul>09/30/11 Software Servers Staff The ad server software needs to run on one or more servers (either dedicated, cloud or VPS) The ad server will need a systems administrator and some form of technical user support Using one of the few installable commercial-strength ad servers (incl. OpenX Source and DART Enterprise) Total cost of ownership #OXwebinar
  5. 5. Putting it all together <ul><li>The exact number and setup of servers will depend on various factors, most importantly: </li></ul>09/30/11 The geographical distribution of the site ’s visitors The volume of ad impressions to serve, including peak volumes Total cost of ownership #OXwebinar
  6. 6. Our three different TCO scenarios are based on two distinct technical architectures 09/30/11 Total cost of ownership #OXwebinar on a simple, non-load balanced architecture on a complex, globally load balanced architecture A small, regional publisher 1 using 2 A medium sized, regional publisher using 3 A large, multi-regional publisher using
  7. 7. Our benchmark: OpenX Enterprise <ul><li>For each of our TCO comparisons we will use OpenX Enterprise as the benchmark: </li></ul>09/30/11 Total cost of ownership #OXwebinar
  8. 8. How we calculated the TCO for a small, regional publisher using OpenX Source <ul><li>To calculate the cost of a self-hosted, non-globally load balanced OpenX Source ad server we used the following inputs: </li></ul>09/30/11 Software Servers Staff <ul><li>Assume 25m impressions / month / server </li></ul><ul><li>Assume each server costs $300 / month </li></ul><ul><li>Assume 25% of impressions are rich media </li></ul><ul><li>Assume one technician paid $87,000 / year </li></ul><ul><li>How much time spent on ad server varies from 50% to 60% based on volume </li></ul><ul><li>OpenX Source is free, so no cost here </li></ul>1 Total cost of ownership #OXwebinar
  9. 9. Comparing this TCO to OpenX Enterprise <ul><li>The monthly cost of self-hosting OpenX Source scales linearly, and is 41%-225% more expensive than OpenX Enterprise: </li></ul>09/30/11 1 Total cost of ownership #OXwebinar
  10. 10. How we calculated the TCO for a medium sized, regional publisher using DART Enterprise <ul><li>To calculate the cost of a self-hosted, non-globally load balanced DART Enterprise ad server we used the following inputs: </li></ul>09/30/11 Software Servers Staff <ul><li>Assume 25m impressions / month / server </li></ul><ul><li>Assume each server costs $230 / month </li></ul><ul><li>Assume 25% of impressions are rich media </li></ul><ul><li>Assume one systems administrator utilised 25%-35% paid $96,000 / year </li></ul><ul><li>Assume one technical support operative utilised 25%-35% paid $78,000 / year </li></ul><ul><li>DART Enterprise costs $250k or $9,600 / month over 3 years </li></ul>2 Total cost of ownership #OXwebinar
  11. 11. Comparing this TCO to OpenX Enterprise <ul><li>The monthly cost of self-hosting DART in a regional setup scales linearly, and is 232%-46% more expensive than OpenX Enterprise: </li></ul>09/30/11 2 Total cost of ownership #OXwebinar
  12. 12. Large, multi-regional publisher using DART Enterprise: how we calculated the TCO <ul><li>To calculate the cost of a self-hosted, globally load balanced DART Enterprise ad server we used the following inputs: </li></ul>09/30/11 Software Servers Staff <ul><li>Assumptions as in scenario 2, but add: </li></ul><ul><li>Upweight required impressions by 40% to handle one regional center falling over </li></ul><ul><li>Assume $1,200 / month for global load balancing </li></ul><ul><li>Assume one systems administrator utilised 30%-100% paid $96,000 / year </li></ul><ul><li>Assume one technical support operative utilised 30%-100% paid $78,000 / year </li></ul><ul><li>DART Enterprise costs $250k or $9,600 / month over 3 years </li></ul>3 Total cost of ownership #OXwebinar
  13. 13. Comparing this TCO to OpenX Enterprise 09/30/11 The monthly cost of self-hosting DART globally scales linearly, and is 165%-37% more expensive than OpenX Enterprise: 3 Total cost of ownership #OXwebinar
  14. 14. Our benchmark: OpenX Enterprise <ul><li>41-255% </li></ul>09/30/11 The monthly costs of self-hosted ad serving are significantly higher than hosted OpenX Enterprise in all three of our TCO comparisons: 46-232% 37-165% Total cost of ownership #OXwebinar A small, regional publisher 1 using 2 A medium sized, regional publisher using 3 A large, multi-regional publisher using
  15. 15. There are some other key differences between self-hosting and hosted adserving 09/30/11 The self-hosted setups have several limitations which are not highlighted in a straightforward TCO comparison Redundancy Security Functionality Malware groups use out-dated, unpatched self-hosted ad servers to distribute malware Self-hosted OpenX Source does not have all of the plugins (e.g. forecasting, advanced analytics) found in OpenX Enterprise No global load balancing / spare capacity in our first two scenarios – one data center means a single point of failure Total cost of ownership #OXwebinar
  16. 16. Given the cost comparisons and other qualitative issues, we recommend that publishers use a hosted ad server solution such as OpenX Enterprise 09/30/11 Total cost of ownership #OXwebinar

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