February 2012

Networking Equipment Cost Optimization

Buying Used Servers may be a Gray Market, but Cost Optimization isn’t

By Andy Hawkins, 1E

Taking a close look at which of your servers are doing useful work and acting on that intelligence improves IT efficiency and your bottom line.

Clearing an attic is easy. You know the things up there haven’t been used in a while and it’s therefore easy to take items to be recycled – they won’t be missed. In the corporate world however, it’s not so obvious to spot what’s useful and what can go – so how do you flush out the waste?

In particular, in IT departments, there’s hardware waste that is not obvious to the naked eye. With the right software, such as a server power management tool like NightWatchman Server Edition from 1E (www.1e.com) with a built in visual dashboard, you can quickly identify the servers that are not performing any useful tasks and make an informed decision to re-deploy or decommission and recycle them.

Recycling has grown since legislation such as the Waste Electrical and Electronic Equipment Directive (WEEE Directive) and the corresponding Restriction of Hazardous Substances Directive (RoHS Directive) became law in the European Union in 2003. Combined, the legislations ensure the safe disposal of waste electrical and electronic equipment and restrict the use of certain hazardous substances in that equipment. In both cases, they aim to reduce the amount of electrical and electronic equipment being produced and to encourage everyone to reduce, reuse and recycle.

Companies do not have the right to simply dump redundant electronic equipment, and so a ‘gray’ market has grown up for used hardware assets to be recycled, resold and put back into service.

Larger enterprises often have a budget that accommodates buying the latest and greatest IT hardware accompanied by a process to renew equipment within three to five years. This doesn’t mean that these assets are no longer in working order but that they are no longer wanted. In the age of austerity, faced with budget constraints, smaller enterprises have to be cannier. They may either choose, or indeed have to resort, to buying older models that are still reliable and have a useful lifespan.

Research (Server energy and efficiency report 2009, Alliance to Save Energy) has revealed that an estimate 15% of servers do not perform useful work, resulting in $25billion of waste globally, and accounting for $3.8billion in energy alone. Consider this; if one in six servers can be decommissioned in your environment, you can save on energy costs, sell the unused servers and run your remaining hardware assets more efficiently.

NightWatchman Server Edition measures and monitors the useful work a server performs. It relates energy usage to work done, giving organizations a clearer idea of the value of every kilowatt (kW) of energy consumed and therefore, the business value companies stand to get from each server.

But essentially this isn’t about the level of business value, high or low, but about whether your servers are doing anything useful at all. If there’s no useful activity, then your investment is giving you absolutely no return. If a server is busy only performing ‘housekeeping tasks’ such as virus scanning or receiving software updates, then it is not providing any value to the business.
Companies can stand to make savings of as much as $4400 ($145,000M / 33,000,000 servers = $4,400 per server – In 2008, approximately $145,000M was spent on new server spending and management and administration of 33M servers, according to IDC report: “Optimizing Infrastructure and Server Management in Tough Economic Times) per year per physical server decommissioned. This does not include its second hand value which can add hundreds or thousands of dollars to your final saving. It may be less than half the value you paid for it originally but after three to five years of use it will still have value for someone. In fact, by freeing up space and liquidating assets into the gray market, you are not only becoming a lot more efficient and lean in the process but you are acting responsibly towards the environment.

As companies have so many servers doing nothing, it’s nice that once identified and decommissioned, that these hardware assets continue to work and become useful elsewhere. Today’s CEOs rely on CIOs to turn data into usable information, information into intelligence and intelligence into better business decisions. The ultimate goal is cost optimization.

If you are being tasked with optimizing costs in 2012, take a look at your server estate today. Give the business some actionable data about which servers can be re-deployed or decommissioned and take the first step towards saving money.

Why wait?

About 1E
1E is the pioneer and global leader in Efficient IT solutions. 1E’s mission is to identify unused IT, help remove it and optimize everything else. 1E Efficient IT solutions help reduce servers, network bandwidth constraints, software licenses and energy consumption and many time consuming IT tasks. www.1E.com