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TCA/TCO Benefits of Consolidating Databases and x86 Servers on IBM zEnterprise Servers with Linux
WinterGreen Research, Inc.
Whitepaper: TCA/TCO Benefits of Consolidating Databases and x86 Servers on IBM zEnterprise Servers with Linux
As a C-level executive, you are always on the lookout for ways to reduce IT costs while increasing systems capability in order to grow sales and/or improve service. Leveraging applications with automated business processes that enable user centric interconnected applications embracing interfaces that are inherently enabled for smart devices with efficient systems represents a proven way to improve the business. As your IT managers look for economies within the data center, improved Linux systems can provide those economies. Benefits of Linux open systems include capabilities for supporting application and data base consolidation. Linux systems consolidations eliminate server sprawl and provide for virtualization of servers. Server sprawl may be eliminated in a partial manner by consolidating from many servers and moving them as images to ten percent or fewer servers using VMware, or more completely by taking the images onto one enterprise-class Linux server. Linux systems consolidation may occur within the line of business or inside the IT data center. With a zEnterprise server consolidating images onto a condensed footprint, the result is to eliminate application and database distributed servers, along with decreasing or eliminating many software application licenses, and database licenses. The cost reduction implications are significant as illustrated hereafter. The larger, faster IBM zEnterprise servers have compelling TCO and TCA metrics that show considerable cost savings over VMware consolidation implementations. IBM zEnterprise is a viable data and server consolidation option. Linux on z is a solution available to the line of business to promote enterprise class capability while reducing distributed server systems operations costs. As an Executive responsible for controlling IT costs, you can use the approach outlined herein to analyze your situation and to quickly identify potential IT cost reduction benefits by doing a proper TCA/TCO analysis. The IBM zEnterprise Linux server technology cost advantages presented herein are achieved in part through server
COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.
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consolidation. Fewer application and database software licenses, fewer people, and less energy costs provide compelling savings in IT acquisition and operations costs.
Server, Networking, and Software Total Cost of Acquisition (TCA) Comparison

Following is a total cost of acquisition (TCA) cost comprison for 80 physical x86 servers in the first case versus 80 VMware images on 5 blade Linux servers in the second case, and 80 applications on one zEnterprise 114 in the third case. Figure 1 Total Cost of Acquisition (TCA) Comparison of Different Server Implementations of One Application
TCA of 80 Linux Servers : x86 Distributed, Blade VMware Virtualized, and zEnterprise z/VM Servers
800000
730,388
700000
In Dollars
600000
532,212
500000
400000
349,756
300000
200000
Distributed
Source: WinterGreen Research, Inc.
Blade VMware
zEnterprise Linux
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The total cost for one zEnterprise 114 (See Appendix 1 for configuration details) hosting the virtual images, for server hardware purchase plus software and infrastructure of network, database, and storage is $349,756 as compared to $730,388 for 80 standalone x86 servers when every web service application instance is hosted on its very own server. This is versus $532,212 TCA for the consolidation to 5 larger distributed Linux blade VMware equipped servers The acquisition costs of hardware, software, and infrastructure components including network and storage systems have similar proportions for the three scenarios as illustrated in Figure 2. Figure 2 Component TCA Hardware, Software, and Network, Database, and Storage Infrastructure Costs for 80 Linux Servers and / or Images
Proportion of Hardware, Software, and Infrastructure Cost for 80 Linux Production and 80 Linux Support Servers
800,000.0
730,388
700,000.0
600,000.0
532,212 349,756
500,000.0
400,000.0
300,000.0
200,000.0
100,000.0
0.0 1 2 3
Distributed x86 Servers
Blade Unix Server with VMware
zEnterprise with Linux Images
Server Cost / z 114 Cost Software Application, OS, Security, VM Network, Database, and Storage
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The two charts above illustrate that the zEnterprise 114 is the least cost system by 52% over the VMware blade systems when considering direct acquisition costs. When looked at from the point of view of the useful life of the equipment asset, the analysis yields different results; the zEnterprise server becomes far more attractive than the other systems implementations. Following is a snapshot analysis of acquisition cost divided by useful life to show single year cost for the different systems configurations when shared workload, useful life, and utilization are taken into consideration. As shown below, the savings are dramatic.
Figure 3 Analysis showing Single Year Costs for Seven Year Timeframe Including Server Useful Life: TCA of 80 Linux Production and 80 Linux Support Servers Including the effects of variable systems utilization, variable virtualization efficiency and variable workload sharing accumulated over seven years. This analysis is rationalized for constant lease payments, to show a one year snapshot of TCA.
TCA of 80 Linux Servers Over Useful Life of Equipment: x86 Distributed, Blade VMware Virtualized, and zEnterprise z/VM
160,000
140,000
133,536
120,000
In Dollars
100,000
84,458
80,000
60,000
40,000
20,000
18,381
Distributed Blade VMware zEnterprise Linux
Note: Includes virtualization consolidation efficiencies achieved and workload sharing effects.
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In this case, the zEnterprise 114 is 4.6 times less expensive than the VMware blade workload systems implementation. The TCA of 80 Linux servers along with their support systems over the useful life of the equipment analysis illustrates that the 80 distributed servers plus the 80 support servers cost $133,536 per year, the blade VMware virtualized (80+80) systems for a comparable workload are $84,458 per year, and the zEnterprise 114 hosting (80+80 images) is $18,381 per year. Additional savings come from utilizing the zEnterprise 114 in a shared workload environment, where the assumption is that 35% of the zEnterprise 114 processing capacity is used for other applications (for example: managing distributed server security authentication or another department running Linux) and 65% of workload processing capacity is consumed by the consolidated Linux applications. The most compelling factors that have impact on the more detailed server TCA analysis beyond purchase price are application workload, shared workload, utilization, and years of server useful life. By looking at the entire TCA costs for each of the three server scenarios over 7 years, it is possible to derive rational, comparable costs for one year. The zEnterprise servers (with a single asset serial number) tend to be refreshed rather than replaced, permitting continuing lease whereby the actual lease amount goes down as the years go forward, because the box has been depreciated.
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Figure 4 Selected Assumptions Used for TCA Analysis of Servers

Selected Assumptions Used for TCA Analysis of Servers Distributed Servers HP Proliant DL 381 # Production Servers x 2 for x86 and Blade $ Per Server Servers Purchase Price $ % Server Workload Shared % Utilization $ Per Server / Shared Workload Years of Useful Life / Refresh $ Server Costs Per Year Over Useful Life Source: WinterGreen Research, Inc. Virtualized Distributed Linux zEnterprise
80.0 2,340.0
374,400.0 100.0 5.0 374,400.0 3.0 133,536.0
HP Blade Virtual Machines 685 VMWare on z/VM 5.0 1.0 23,680.0 185,000.0
236,800.0 100.0 35.0 236,800.0 3.0 84,458.7 185,000.0 35.0 85.0 120,250.0 7.0 18,381.1
Distributed servers and blade VMware units have a typical 3 year shelf-life. The newer x86 systems use less energy and are more efficient, creating advantages to a 3 year x86 server replacement cycle program. The independent benchmarks from TCP C, TCP A and others form the basis for making assumptions about workload and cost per server. Many variables are considered in the seven year analysis where the seven year costs are totaled and divided by 7 for each system. Distributed and blade servers that sit completely idle are a separate issue. Shared workload is an issue as well. Processing nonrelated workloads during low utilization times has direct impact on reducing zEnterprise 114 TCA. The number of application server licenses and database licenses in the virtualized blade systems are an cost issue for those systems. IBM zEnterprise requires considerably fewer software licenses than the other systems being compared.
Total Cost of Acquisition (TCA) For Deployment Topology

TCA includes acquisition of server and storage hardware, but also the software licenses required for the deployment topology. Database servers and licenses, test and
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development servers, software licenses, networking routers and cabling are some of the often overlooked server acquisition associated TCA costs. The usual as-is configuration in a horizontally scaled-out network of x86 distributed servers running a like application and/or copies of data to support application workloads is well defined and typically somewhat standardized. (See Appendix for configuration used in this analysis). Many firms have already embarked on a consolidation and virtualization strategy to collapse the high number of smaller user-centric singleapplication servers into a larger server shared by multiple users using technologies such as VMware. A more scalable and cost effective mixed workload solution is provided by Linux on IBM System z. Even though the single server is $2,340 each, when compared to the cost of the zEnterprise at $185,000 (See Appendix for system configuration used in this analysis), the zEnterprise is less expensive because when considering workload, the more expensive unit is more efficient at running the workload, the $ per unit of workload is lower on the zEnterprise 114 (z114).
IBM zEnterprise 114 Lowers Entry Cost

The IBM z114 lowers the entry cost to get started with the enterprise Linux server. Faster cores and a bigger system cache on the zEnterprise 114 and its larger sibling zEnterprise 196 let users do more processing at less cost. Whether running Linux on z/VM, or on integrated IBM System x or p blades within the zEnterprise BladeCenter Extension (zBX), the zEnterprise solution offers workload optimization choices beyond the traditional mainframe operating environments -- and this flexibility of operating environments and deployment choices within a single system is unique to the zEnterprise System. The total cost of acquisition analysis for a single application consisting of 80 production instances (plus 80 supporting server instances which we will discuss next) illustrates the differences in cost between images instantiated on single servers, VMware virtualized servers and a zEnterprise z/VM virtualized server.
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The launch of production applications on 80 servers depends on the existence of background server resources, used for testing, development, quality assurance and database systems support. This analysis assumes that there is an equal number of nonproduction x86 and blade servers used for test, development, and database as production x86 and blade servers (a 1:1 ratio of production to non-production). It should be noted that this is a rather conservative estimate vs. the 1:4 or 1:6 ratios often used in similar analyses. Our belief is that the 1:1 scenario is more accurate than the other ratios, more representative of what is found in typical data centers. Any higher ratio simply increases the savings from the zEnterprise 114 server case. Thus when we analyze 80 x86 Linux servers with a cost comparison, there are an additional 80 x86 servers needed to make the application instantiation a reality. For blade servers the same scenario holds true for hosted server images. IT has other choices for hosting test and development in the cloud, running the database on a mainframe, and so forth, but we have chosen to analyze using this ratio. As shown in the illustrations, the 80 distributed production servers plus 80 supporting other servers together cost more to implement than the single zEnterprise 114 server. Applications can be implemented on real (physical) servers or as (virtual) server images on blade servers or a zEnterprise 114 server. In every case there are a total of 160 application images that need to be processed on some server. Designed, sized and priced for mid-sized organizations, the zEnterprise 114 is the newest addition to the IBM zEnterprise System class of servers; it sells for approximately $185,000 USD in the selected configuration considered in this instance (pricing may vary by country) and is positioned as an alternative to scaled out virtualized servers for the line of business requirements. Consolidation of an application onto a single zEnterprise server turns out to be the most cost efficient way to implement web services. (Who knew?) Instantiation of multiple server images on a blade server using several servers using VMware is the second most cost efficient way to deploy web services enabled applications. Use of multiple single inexpensive x86 servers, one for each single
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application instance (commonly called the scale out approach) is the most expensive way to deploy these types of applications. There are many sets of web services enabled Linux applications running in IT data centers on 80 or so production servers. This is a typical number of servers or images for a specific, targeted application. Competitive pricing for Linux on System z proves to be an attractive alternative to server sprawl. A combined total cost of acquisition (TCA) and total cost of ownership (TCO) perspective provides insight into cost structures. In an environment with 5 virtualized physical blade servers with 80 Linux images on production servers using VMware as compared to the same Linux images on zEnterprise 114 with z/VM shows there are multiple areas of cost reduction possible in the total infrastructure.
Total Cost of Ownership (TCO)

In part, the single x86 or blade servers are more expensive because they are more labor intensive than the zEnterprise 114 and labor accounts for 70% of the cost of running an IT department. The more automated process provided by zEnterprise 114 is significant because it permits faster, better application launch and systems management. In part the difference in IT TCO cost is because the single x86 servers run at only 5% utilization on average while the zEnterprise server demonstrates 85%+ utilization, creating economies of scale. Economies on consolidated systems are achieved in energy, cooling and floor space efficiencies and in the need for fewer software licenses on the consolidated virtualized systems. Software cost for the VMware virtualized blade systems are particularly impacted by the number of cores in the server. The software and software maintenance pricing is by core so even though there are only 5 distributed servers as in the above VMware example, there are still 16 cores on each server and 80 licenses needed with maintenance, resulting in no database or application software savings.
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The zEnterprise device uses three cores in this situation so there are significantly fewer licenses, only three, but it needs to be noted that the dollar per core is higher for this type of zEnterprise server and this impacts ongoing maintenance costs. The graphics following show more detail for the TCO of HW/SW for a small configuration scenario (horizontal scale-out of distributed x86 servers, consolidated larger distributed blade servers with virtualization, and a zEnterprise consolidated / virtualized system. Figure 5 Total Cost of Ownership (TCO) 80 Linux x 86 Production and 80 x86 Support Servers, 80 Blade Virtualized Production Images and 80 Support Virtualized Images Cost Comparison to One zEnterprise z/VM Implementation
Total Cost of Ownership (TCO) 80 Linux Production Servers Cost Comparison

300,000.0 250,000.0 200,000.0
Outage Cost
150,000.0
100,000.0 50,000.0 0.0
Floor Space, Power, and Cooling
Software and Hardware Updates and Maintenance

Labor Costs
Distributed
Blade
zEnterprise
Note: Analysis per Year, Comparable Cost Over 7 Years.
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The 80 production servers or server images are matched by an equal number of support servers or server images (160 in total). The variables looked at in the total cost of ownership TCO include outage cost, floor space, power, cooling, software and hardware updates, backup, software and hardware maintenance, and labor costs. These TCO costs are shown for one year. They represent recurring costs so the disparities become more pronounced over the seven years considered in the analysis. Even in one year, the TCO numbers show very compelling advantage to use of zEnterprise for web services enabled workloads. An analysis showing significant advantage to the operating costs of the zEnterprise System over an extended period beyond the initial first year is not shown but can be calculated fairly easily to demonstrate the effects over several years. The 80 x86 distributed production servers have operating costs of $288,298 for one year. The blade servers with VMware have one year operating costs of $127,225 and the zEnterprise benefits from no outage costs and lower labor costs because of more automation in the system. An 80 production server configuration was chosen as an example because it is representative of a variety of web application situations commonly found in IT environments. Web services enabled applications are used for ordering, transaction management, and shipping process management. While there are thousands of different IT data center metrics to analyze in the WinterGreen Research ROI tool, a representative average has been chosen for this analysis.
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Figure 6 Total Cost of Ownership (TCO) 80 Linux Production Servers Cost Comparison
Assumptions Used for Analysis of Total Cost of Ownership (TCO) Linux Servers
In Dollars
Distributed Servers Virtualized Distributed Linux zEnterprise
HP Proliant DL 380 HP Blade 685 Servers Virtual Machines Labor Costs Software, Hardware Updates, Maintenance Floor Space, Power, and Cooling Outage Cost Total $
84,000.0 72,288.0 48,000.0 62,010.0

266,298.0
VMWare 23,000.0 51,275.4 11,610.0 41,340.0

127,225.4
on z/VM 13,500.0 51,100.3 3,167.0 0.0

67,767.3
Note: Per single year costs, comparable cost over 7 years.

What costs $266,298 per year to implement as a set of Linux web services enabled applications deployed enterprise wide on 80 distributed x86 production servers, costs $127,225 on blade servers with VMware. The comparable processing costs decline to $67,787 on the zEnterprise 114 because the mature system has the best automated processes.
The zEnterprise 114 (or z196) server is cost efficient because it uses less power and fewer software licenses. Stand alone servers are very inexpensive to purchase, but their utilization tends to be low, software licenses are cumulatively more expensive. Application images virtualized under VMware on a Blade are more expensive than on the zEnterprise 114.
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These numbers illustrate why consolidation of servers is creating significant incentive in the market for IT departments to move to virtualized systems. As illustrated, virtualization alone is not sufficient, VMware systems have their limitations, and it is difficult to get many images on a server, 16 virtual server images on a blade is the number used for this analysis. Many users start out trying to put 50 images on the blade. Studies show that 16 images per blade is reasonable, a little above the average of 10 images per blade. Utilization of 65% is difficult and expensive to sustain, 35% is more often the case. Blade servers are generally limited to only one type of workload, the cost of electricity is still high, and the ratio of full time personnel to servers remains high.
TCO and TCA Costs Form Basis For Comparative Consideration Of 80 Linux Production Servers
The same amount of workload processing can be done in less time, with more reliability, more security, and more automated management of process leveraging the high availability and high utilization for the zEnterprise servers. In addition, the zEnterprise can manage many different workload types on the same system and is designed to run at 100% utilization, creating greater efficiencies than are available on blade systems running VMware, which tend to be tuned for a specific workload type. For one year TCO / TCA for an organization to run web services enabled application server virtual images on zEnterprise means that the total cost of each virtual image including operations and labor is less than the cost of the distributed server hardware alone. Distributed servers have additional costs for software, networking and database storage and operations. Once the hardware has been paid for, there are significant areas of savings from the operations aspects of ongoing systems support. The total cost per image per year on zEnterprise is $700 in this scenario, including all the associated hardware, software, labor, and operating systems costs and becomes even less improves as more workload is added to the system. This cost per unit of workload analysis is conducted in a thoughtful, detailed, and professional manner using the independent WinterGreen Research ROI tool, available
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for subscription to anyone who is interested. Such an analysis of TCO and TCA costs forms the base for consideration of a range of systems configurations. Analyses are done keeping in mind that there are always many different scenarios and data center complexities due to processor workload optimization and similar considerations. Trends do appear able to be identified. Security is integral to the design of zEnterprise. Security is built in the DNA of the System z hardware and operating systems which provide additional support for ANSI, firewalls, and PCI standards. IBM middleware packages run equally well on all platforms. This provides the capability to migrate systems off expensive application and database server sprawl to the consolidated mainframe. The zEnterprises capability to integrate directly with a blade server extension (zBX) that runs select native POWER7 and System x x86 processors for those workloads that require it, addresses any past shortcomings. Competitive IBM pricing for Linux on System z and zEnterprise proves to provide a compelling alternative to server sprawl when looked at from a TCO / TCA perspective.
Conclusion
The TCA and TCO benefits come from consolidating databases and distributed x86 servers as images on zEnterprise with Linux. Benefits are compelling for the right workloads. The larger, faster zEnterprise server has TCO and TCA benefit needs to be considered by you as a fiscally responsible C level Executive. The direction outlined here illustrates how you can control costs using the IBM zEnterprise server consolidation and database consolidation value proposition. Competitive pricing for Linux on System z proves the scale up server is an alternative to server sprawl. Linux on z is a solution for the line of business. The LoB can achieve enterprise class capability at distributed server pricing. The benefits of Linux open systems capitalize on capabilities that enable application and data base consolidation. Clients are looking for economies relating to Linux. The costs of server sprawl and associated data base licenses are very high compared to the costs of the zEnterprise
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System. The same people who support Linux on distributed servers can support Linux on zEnterprise because it is the same. The enterprise Linux server runs multiple virtual Linux servers concurrently. IBM zEnterprise Linux Server provides simplification, scalability, reliability, high availability and security capabilities that go beyond anything a distributed server can offer and at a lower TCA / TCO. Single-server simplicity is a priority and zEnterprise 114 (and/or z196) positions the enterprise Linux server to provide Web based and application functionality directly for the line of business. The enterprise Linux server allows running applications on a single server, which saves software license and management costs, floor space and energy costs. It significantly reduces labor costs which represent 70% of the IT budget. The enterprise Linux Server handles data analytics. It is a game changing, transformational server. The enterprise Linux server advanced virtualization technology, automation features and highly-scalable server capacities are significant. Availability in an enterprise Linux server is enhanced by the backup (spare) cores within to system so there is no single point of failure, providing a system that goes far beyond the traditional server hardware in its ability to perform without any downtime. The availability design point focuses on the applications, which results in an integrated environment where hardware, firmware, virtualization software, Linux and middleware work in concert to provide application and data availability and security. Executives are encouraged to view zEnterprise with Linux on System z as another Linux server with much more scalability and flexibility. Linux will run on System z as it does on other hardware and this enterprise class system has compelling cost of computing benefit.
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Appendix Server configurations used in analysis

Assuming lighter weight Linux web services enabled application: IBM zEnterprise 114 Server Machine Model: M05 Memory: 72 Gigabytes RAIM (Redundant Array of Independent Memory). Number of IFLs: 3 z/VM and Red Hat Linux x86 Servers HP ProLiant Model DL381 Memory: 8 MB RAM Red Hat Linux CPU Type: Intel Xeon X5690 3.46 GHz
Total # of Processors: 2 Total # of Cores: Total # of Threads: 12 24
Linux Midrange Blade Servers HP ProLiant Blade 685 Memory: 64 GB RAM Red Hat Linux
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White Paper:

WinterGreen Research, Inc.

WinterGreen Research, Inc.

Server, Networking, and Software Total Cost of Acquisition (TCA) Comparison

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

Distributed x86 Servers

Blade Unix Server with VMware

zEnterprise with Linux Images

Source: WinterGreen Research, Inc.

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

Figure 4 Selected Assumptions Used for TCA Analysis of Servers

Total Cost of Acquisition (TCA) For Deployment Topology

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

IBM zEnterprise 114 Lowers Entry Cost

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

Total Cost of Ownership (TCO)

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

Total Cost of Ownership (TCO) 80 Linux Production Servers Cost Comparison

Floor Space, Power, and Cooling

Software and Hardware Updates and Maintenance

Note: Analysis per Year, Comparable Cost Over 7 Years.

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

84,000.0 72,288.0 48,000.0 62,010.0

VMWare 23,000.0 51,275.4 11,610.0 41,340.0

on z/VM 13,500.0 51,100.3 3,167.0 0.0

Note: Per single year costs, comparable cost over 7 years.

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

WinterGreen Research, Inc.

Appendix Server configurations used in analysis

Total # of Processors: 2 Total # of Cores: Total # of Threads: 12 24

COPYRIGHT 2011, WINTERGREEN RESEARCH, INC.

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