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Reducing TCO with a Software-Defined Data Center

By: Kaylie Gyarmathy on April 9, 2019

Building the computing infrastructure necessary to deliver services to customers once posed a significant barrier to entry for many companies. Given the high costs of building a private data center, most smaller organizations simply couldn’t compete with more established enterprise-level players in the market. While colocation data centers have leveled the playing field to a large extent, the development of software-defined data centers (SDDCs) has the potential to deliver the same benefits for an even better total cost of ownership (TCO).

Through virtualization technologies, SDDCs are able to abstract the processing and storage power of a server into a compartmentalized software form. This allows them to sell portions of that processing and storage capacity, making it possible for multiple customers to host applications and data on a single high-density server. Whether an organization is utilizing a private cloud, hybrid cloud, or multi-cloud solution, virtualization can deliver significant TCO data center savings.

4 Ways Server Virtualization Technologies Reduce Costs

Improved Energy Efficiency

Power usage is one of the greatest ongoing challenges facing any data center solution. Aside from the energy consumed by high-density servers, there are cooling infrastructure demands to consider. Fortunately, new developments in storage technology, processing capacity, and cooling equipment have helped to address this issue through server virtualization technologies. Rather than running multiple applications across several different servers, each one with its own power and cooling needs, SDDC deployments make it possible to consolidate those applications into a single server.

By virtualizing hardware resources and running multiple applications within a single server, data centers can maximize their available resources and deliver tremendous efficiency savings to customers through sheer economies of scale. Even if an SDDC has greater power demands in the aggregate thanks to running so many high-density deployments, it will be using those computing resources far more efficiently and delivering services to a much larger number of customers, pushing down their share of costs in the process.

Fewer Hardware Hassles

For companies debating between investing in physical servers or opting for virtualization technologies, it might seem beneficial to get something tangible for their network needs rather than paying for a service model. This overlooks the fact that today’s servers have an expected lifespan of only three to five years. In addition, investing in physical infrastructure isn’t a “one and done” upfront expense. Hardware needs to be maintained and updated regularly.

Furthermore, every application and potential capacity expansion needs to take those hardware capabilities into account. If a company isn’t careful, it could lock itself a specific platform or vendor, potentially limiting its future flexibility. Every additional piece of hardware also brings with it increased power and cooling costs, tacking increased operating costs onto the capital expense of purchasing the equipment.

With virtualization technologies, applications and infrastructure remain vendor-neutral and hardware-agnostic, making them easy to relocate or modify as needed. This is especially critical for private cloud, hybrid cloud, and multi-cloud deployments. Eschewing physical servers also eliminates the upfront expense of purchasing hardware and the ongoing headaches of maintaining it throughout its lifecycle.

Accelerated Scalability

No company wants to be caught in a situation where it can’t expand its capacity quickly enough to keep pace with business demands. Growth opportunities don’t come along every day, and missing out on the chance to scale operations could be tremendously damaging to a company’s long-term health. When hosting applications on physical hardware, there is a hard limitation on growth because operations can only scale within the bounds of available resources. In order to continue growing, new hardware will need to be purchased, which is not only expensive, but also time-consuming. By the time the new equipment is in place, the opportunity for growth may have already passed.

With a purely software-defined infrastructure using virtualization technologies, scaling is as easy as picking up the phone (or even opening a customer software portal) and ordering more capacity. Virtualized servers can quickly accommodate new initiatives and applications, affording companies the flexibility to pursue ambitious growth strategies and capitalize on opportunities that would not be available to them with a traditional deployment. And converting on new opportunities has the added benefit of bringing in more revenue, which helps to offset the expenses of growing infrastructure. Even better, if business slows down unexpectedly, an SDDC can scale down capacity whereas traditional servers leave companies stuck paying for power and cooling they no longer need.

Full Automation

Business intelligence and data center infrastructure management platforms have revolutionized data center operations, allowing facilities to better manage power and cooling needs while providing real-time analytics data to their customers. Armed with this performance and traffic information, companies can better optimize their IT infrastructure for significant energy savings.

By shifting to an SDDC virtual technologies solution, however, they can realize even greater efficiency. Eliminating physical servers and running applications in a purely virtualized environment managed by sophisticated analytics programs reduces the need for ongoing human intervention. With fewer hands needed to manage servers, valuable IT personnel can devote their efforts to developing innovative new services that drive business success and growth. Automation not only delivers better efficiency, but also reduces the number of human errors to ensure higher levels of service uptime.

Viewed from a holistic standpoint, the TCO data center savings of a purely virtualized infrastructure has the potential to be significantly better than that of a traditional, server-based network. While many companies may have some reservations about shifting to a purely virtual solution, the tremendous advantages in terms of cost savings and flexibility are difficult to dismiss. As service versatility and product speed-to-market become more crucial to business success in the coming years, SDDC deployments are sure to become a more attractive option for forward-thinking companies.

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