Factors to reduce TCO
by Bel Dric
1. Therefore server efficiency is maximized
2. Virtualization allows for a Multiple Tenant Model (MTMs)
3. In a multitenant application, multiple customers use a single instance of the application simultaneously
4. customers can shift their demand from high utilization periods to low utilization periods
5. Source: http://news.microsoft.com/download/archived/presskits/cloud/docs/The-Economics-of-the-Cloud.pdf
6. Demand-Side Savings
6.1. Virtualization
6.2. To further smooth demand, sophisticated pricing can be employed
6.3. Time-of-Day patterns
7. Multi-Tenancy Savings
7.1. Fixed application labor for multiple tenants
8. A datacenter can maximize its server utilization by taking advantage of daily usage patterns of people around the world
9. A server can cater to two countries of contrasting time zones, so when server usage drops to the minimum in one country, the usage will peak in the other
10. So when server usage drops to the minimum in one country, the usage will peak in the other and make up for the unused services
11. Multiple tenants can share a fixed number of server staff managing their applications server-side
12. One server group can manage multiple instances of the same application simultaneously
13. Therefore costs can be lowered by hiring the same amount of staff to manage more of the same rather than one staff to each application
14. Increasing need for security and reliability scales the economic impact of such services accordingly
15. A single network administrator can oversee a large number of servers at once
16. TCOs : Total Cost of Ownership
17. A network admin works just as well in a Datacenter with 100 servers as one with 1000 servers
18. Thus a large Datacenter can afford less IT staff as compared to two smaller Datacenters
19. Supply-Side Savings
19.1. As cloud and other related technologies get more widespread use, compatibility between devices are increased
19.1.1. Infrastructure Labor Costs
19.1.2. Buying Powers
19.1.2.1. Operators with a large data center can purchase hardware and software at a cheaper price
19.1.3. When the electricity cost drops
19.1.3.1. operators of multiple data centers are able to take advantage of geographical variability in electricity rates, which can further reduce energy cost.
19.1.3.2. locating its data centers in locations with inexpensive electricity supply
19.1.3.3. Operates in multiple data centers instead of one single large data center
19.1.4. Security and Reliability