At EMC World, EMC announced that customers who purchase the Elastic Cloud Storage (ECS) Appliance should expect between 9% and 28%* lower Total Cost of Ownership (TCO) when compared to public cloud storage services. As this represents a large range, I wanted to take this opportunity to clarify how we came to these numbers. I won’t cover the specifics of pricing or costing public cloud storage (that information is readily available on the vendor websites), but instead, I will focus on the model for ECS.
The ECS Appliance consists of a scale-out commodity-based hardware platform from EMC running the ViPR 2.0 software. This provides our customers with all the software-defined functionality of ViPR in an easy-to-buy and deploy hardware appliance. Customers have a choice of form factors that can address a broad range of needs in terms of raw capacity (360TB, 1.4PB or 2.9PB) and capabilities (Object, HDFS or Block).
Alternatively, qualified customers can purchase the ViPR 2.0 software and deploy on a broad range of EMC-certified third party commodity hardware. With this model, customers can rack and stack their own gear while deploying and managing ViPR Software-Defined Storage. For this analysis, I’ll compare a public cloud storage-as-a-service (STaaS) solution with operating the ECS Appliance at comparable scale.
TCO is comprised of five key components:
Let’s look at each one of these components separately:
Platform Service Life
In order to appreciate the cost efficienciesof the ECS Appliance, it’s important to look at a realistic timeframe for how long a customer will use and maintain their storage service. Typical terms when doing TCO modeling are anything from three to five years. In our TCO comparison analysis, we looked at a four-year term of service with a public cloud storage provider vs. operating a private cloud storage infrastructure in an enterprise or service provider data center comprised of ECS appliances.
Hardware Purchase Costs
The economic model for hardware is pretty straightforward. The more you buy, the bigger your discount and rebates from the manufacturer. Taking a look at the scenario where EMC ECS customers can expect a 28% lower TCO when compared to public cloud storage services, we assumed that they were consuming ~5.7PB (Petabytes) of storage capacity.
There are also other hardware costs to consider which I’ll address in the “Data center Overhead” section of this post.
Software Purchase Costs
Like ViPR, the ECS Appliance is licensed using a capacity tier pricing structure. Depending on the mix of Object, Hadoop (HDFS), Content- Addressable (CAS), or Block storage customers require, their costs will vary. Our pricing model is optimized to ensure that we are competitive with equivalent capacity in public cloud pricing. You can contact your local EMC Sales Rep to get more pricing details for the ECS Appliance and ViPR Software-Defined Storage.
Hardware and Software Maintenance
Customers pay for hardware and software maintenance for the ECS Appliance just as they would for any vendor-delivered storage array or software product.
Miscellaneous Data Center Overhead
Like hardware, data center overhead costs deal with the laws of physics, and therefore can only be optimized to a certain level. In our analysis, we looked at data center space, power, cooling, and administration requirements and intra-data center networking. Leveraging our experience from the Atmos and ViPR businesses, data center costs account for roughly 30% of the TCO cost. Of all the costs, we find that the biggest cost factor is data center space. ECS Appliance customers who deploy and utilize the densest configuration (2.88 PB raw) see the biggest cost savings as a full array takes up the same amount of space as a partially-full array.
In the 28% lower than public cloud TCO comparison, we looked at a customer deploying multiple 2.88 PB ECS Appliances. After data center space costs, administrative/people costs and power/cooling make up the biggest cost components of running a data center. We didn’t include ingress/egress costs in our analysis, as we assumed that customers would incur similar costs when uploading and downloading their data from an ECS Appliance or public cloud environment.
Bringing it all Together
In order for a customer to realize 28%TCO savings over four years usingECS technology, they would have to:
And, here’s the breakdown of each cost component compared to public cloud pricing:
At EMC World, we stated that EMC is bringing hyperscale capabilities and economics to everyone which can be delivered at a lower cost than public cloud at scale. It was a bold statement. But we are committed to solving the key pain points identified by our customers, and this was one we heard them ask for repeatedly.
I would be remiss if I didn’t acknowledge that it’s not just cost of ownership that is critical to our customers, but what is becoming increasingly important is the added value ECS delivers over and above what can be achieved by the public cloud. This includes having the data reside on-premise, simultaneous access to the same data (HDFS, Object and CAS), automation of basic but time consuming storage admin tasks, and seamless hyperscaling capabilities.
* EMC used public cloud pricing as of 5/7/14.