Server virtualization cost benefit analysis

CNT 4603: Project Two Page 1 Dr. Mark Llewellyn ©

CNT 4603: System Administration Fall 2019

Project Two

Department of Computer Science University of Central Florida

Instructor : Dr. Mark Llewellyn markl@cs.ucf.edu HEC 236, 407-823-2790 Office Hours: M & W: 2:30-4:30pm

T & Th: 2:00-3:00pm

CNT 4603: Project Two Page 2 Dr. Mark Llewellyn ©

Project Two: Overview • Title: “Project Two: Virtualization Cost/Benefit Analysis” • Points: 100 points • Due Date: Sunday October 6, 2019 by 11:59 pm

(WebCourses time)

• Objectives: 1. To practice conducting a financial feasibility cost benefit analysis for

a server virtualization project. 2. To prepare an executive summary of the feasibility study.

CNT 4603: Project Two Page 3 Dr. Mark Llewellyn ©

Project Two: The Current Scenario • What you are going to do in this project is pretend that you are

the system administrator for an organization that is attempting to determine if virtualization of its computing infrastructure would be beneficial to the organization from a financial perspective.

• As the system administrator you are in charge of conducting the cost/benefit analysis for the proposed virtualization project.

• This will include creating financial spreadsheets using a 5 year projection and writing a brief report summarizing your findings.

• The next few pages describe the current infrastructure of the organization and the proposed virtualization project. Let’s call the organization the ITCorp.

CNT 4603: Project Two Page 4 Dr. Mark Llewellyn ©

Project Two: The Current Scenario • Currently ITCorp is running 5000 physical servers in its data center

which support various applications and several different operating systems.

• These servers are configured into three different groups:

– Group 1 consists of 3500 mission critical servers. Twenty-five hundred of these servers (call them Group 1A) consume 3200W of power each at full load and the other one thousand (call them Group 1B) consume 3800W of power each at full load. The Group 1A servers average load is 25% and the Group 1B servers average load is 30%

– Group 2 consists of 500 non-mission critical in-house application and file servers, each of which consumes 2800W of power at full load. The servers in this group run with an average load of 10%

– Group 3 consists of a pool of 1000 redundant servers utilized as backup servers. Nine hundred of these servers (call them Group 3A) draw 3800W at full load and are used as backups for Group 1 servers. The other one hundred servers (call them Group 3B) draw 2800W at full load and are used as backups for Group 2 servers. Group 3A and 3B servers run at 2% load.

CNT 4603: Project Two Page 5 Dr. Mark Llewellyn ©

Project Two: The Current Scenario • Project Hint #1:

• The power consumed by a server is measured in Watts. Power companies charge for power based on kWH (kilowatt-Hours). The Group1A servers consume 3200W of power at full load. However, they only average a 25% load, so what they actually consume, on average, is 3200W x 0.25 = 800W. A device that consumes 1000W = 1kW for 1 hour will use 1kWH of power. Thus, the Group1A servers are consuming 800W = 0.80kW, so in 1 hour they will use 0.80kWH of power. Servers run 24/7 so in 1 day, 1 Group1A server will use 0.80kWH x 24hr = 19.2kWH of power. There are 2500 servers in Group1A, so collectively they will consume 2500 x 19.2kWH = 48000kWH of power in 1 day. Our assumption (see page 16) is that the power company is charging 15 cents/kwH, so, running Group1A servers for 1 day will cost: 48000kWH x 0.15$/kWH = $7200.00. For year one, the cost to power Group1A servers will be $7200.00 x 365 = $2,628,000.00.

CNT 4603: Project Two Page 6 Dr. Mark Llewellyn ©

Project Two: The Current Scenario • The maintenance contracts on the current physical servers are as

follows:

– Group 1A (3200W) servers: $7500.00/server/year

– Group 1B (3800W) servers: $9500.00/server/year

– Group 2 (2800W) servers: $3000.00/server/year

– Group 3A (3800W) servers: $7500.00/server/year

– Group 3B (2800W) servers: $2500.00/server/year

• Assume that server maintenance costs will increase 4%/year over the duration of the study for all server maintenance agreements.

CNT 4603: Project Two Page 7 Dr. Mark Llewellyn ©

Project Two: The Current Scenario • Project Hint #2: Use a fine grain breakdown of variables in your

spreadsheet – do not “lump together” various values.

Do it this way!

Do not do it this way!

CNT 4603: Project Two Page 8 Dr. Mark Llewellyn ©

Project Two: The Current Scenario • Server administration efforts also vary across the server groups

as follows:

– Group 1A (3200W) servers: 15 administrative weeks/server/year

– Group 1B (3800W) servers: 18 administrative weeks/server/year

– Group 2 (2800W) servers: 7 administrative weeks/server/year

– Group 3A (3800W) servers: 12 administrative weeks/server/year

– Group 3B (2800W) servers: 5 administrative weeks/server/year

• Administrative costs are currently $100/administrative hour. Assume that administrative costs will increase at the rate of 2%/year over the duration of the study.

• An administrative day is 10 hours long. An administrative week is 7 days long. A server day is 24 hours long.

CNT 4603: Project Two Page 9 Dr. Mark Llewellyn ©

Project Two: The Current Scenario • Server backup efforts also vary across the server groups as

follows:

– Group 1A (3200W) servers: these servers are backed-up nightly and require 90 minutes per server.

– Group 1B (3800W) servers: these servers are backed-up nightly and require 105 minutes per server.

– Group 2 (2800W) servers: these servers are backed-up weekly and require 4 hours per server.

– Group 3A (3800W) servers: these servers are backed-up nightly and require 90 minutes per server.

– Group 3B (2800W) servers: these servers are backed-up weekly and require 2 hours per server.

CNT 4603: Project Two Page 10 Dr. Mark Llewellyn ©

Project Two: The Current Scenario • Project Hint #3:

• Be careful with units and time. Some servers are backed-up nightly, others weekly. Example – Group1A servers are backed-up nightly requiring 90 minutes/server. Thus, each server in Group1A requires 365 x 1.5 hours/year of administrative time for backups. Since you are given the time requirement in minutes and administrative time is based on hours, convert backup effort into hours, so 90 minutes = 1.5 hours. Thus, one server in Group1A requires a total of 547.5 hours of backup time in 1 year. There are 2500 servers in Group1A so the total time required for backups is 2500 x 547.5 = 1,368,750 hours. Administrators are paid at the rate of $100.00/hour, so the cost of backing up Group1A servers for year 1 of the study is 1,368,750 x 100 = $136,875,000.00

• Servers that are backed-up weekly require only 52 backups/year.

CNT 4603: Project Two Page 11 Dr. Mark Llewellyn ©

Project Two: The Current Scenario • ITCorp currently employs an external security firm to run routine security

audits on the mission critical servers. This occurs once a month and the charge is $8500.00. Current contract with this firm guarantees this price through the duration of this study.

• ITCorp currently employs a data storage company to maintain archival backup copies of server backups. The charge for this service is billed monthly and is based on the data volume stored each month. The bill last month was $7500.00. Based on the data volume trend produced by ITCorp, it is expected that the next billing level plateau will be achieved at the start of year 3 of the study when the monthly cost will rise to $10,000.00/month. This rate is expected to remain the same throughout the duration of the study.

An aside: According to industry sources, the average cost of storing 1TB of file data is currently $3,351.00/year (about $280.00/month). The rate shown above for the archival backup service would be correct for an organization which is archiving about 27 TB/month.

CNT 4603: Project Two Page 12 Dr. Mark Llewellyn ©

Project Two: The Proposed Scenario • The virtualization project proposed for the ITCorp would reduce

its current number of physical servers from 5000 to 1325.

– Group 1 servers reduced from 3500 to 700. (Note this is a 5:1 consolidation ratio)

– Group 2 servers reduced from 500 to 125. (Note this is a 4:1 consolidation ratio)

– Group 3 servers reduced from 1000 to 500. (Note this is a 2:1 consolidation ratio)

• Sun Server X7-8 servers have been selected to host the virtualized environments. This is one of Sun’s latest and leading edge x86 servers. This is a 5 rack unit (5U) server that supports installations of up to 16 four-socket servers in a 42U rack. Up to 3TB of memory per server is possible. Each four-socket server can be configured with up to 25.6 TB (total of 51.2TB) of NVMe flash with support for four additional SSDs or HDDs.