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Virtualization Heads Beyond Consolidation

The following case study is the first of our five-part series on the gains and pains of server virtualization. First up: Orchard Supply Hardware


A series on the gains and pains of server virtualization
Part One:
Case Study: Orchard Supply Hardware
Part Two:
Roswell Park Cancer Research Institute
Part Three:
Rooms To Go
Part Four:
Next Up In Part 4: Owen Bird Law

A funny thing has happened on the path to virtualization Nirvana: We've stopped, or at least greatly slowed, our progress toward highly virtualized data centers. Gartner says that just 16% of data center loads are virtualized, and our own survey shows ambitions for virtualization are actually backtracking. We set out to find some real-world virtualization "success stories," just to remind ourselves why we went down this road in the first place. Capital equipment savings and greater operational efficiencies have been the promise, but are they being achieved?

The answers, when answers are available, are varied. Some companies haven't slowed down their implementations long enough to measure the results they're getting. "We don't know what the savings are. We just know they're there," is a common response.

At the same time, our InformationWeek Analytics survey found that 35% of respondents say they expect to virtualize less than 25% of their data centers by 2011. That finding reflects either a less optimistic or more realistic assessment than survey respondents exhibited last year, when only 22% took that stance.

Our case study examples—Orchard Supply Hardware leads off our five-part series--ignore the 25% ceiling revealed in our survey. They're for the edification of those seeking much higher levels of virtualization in the data center and demanding a greater return on their virtualization investment.

Orchard Supply Hardware
When Moon Son, director of IT infrastructure at Orchard Supply Hardware, a California chain of 91 stores, became head of the company's data center in 2006, he realized immediately he would have to rebuild from the ground up around virtualization. His new employer had a shopping list of 33 projects it wanted him to undertake on top of an aging infrastructure, such as establishing two new financial systems and a PCI compliance system. For starters, he chose to phase out 30 servers, replacing them with new standalone and rack-mount models from Dell. He virtualized 13 host servers, and in the end, tripled the number of production systems to meet expanded company goals.

Orchard Supply had 45 physical servers, most of them near their end of life, Son recalls. His team rebuilt with Dell Power 2950 two-way servers, PowerEdge R710 rack-mount servers, and an Enterasys network switching fabric better able to handle the traffic. The team virtualized end user applications on Citrix XenApp Server, giving employees in stores Wyse Technology thin clients. Son then led a big push to "virtualize everything."

Orchard Supply is still short of that goal but is running 125 virtual machines on 13 servers. In the previous data center, that application count would have consumed 125 physical servers, each running a single application. Son has maintained the same total of 45 physical servers while tripling the number of system instances in production compared with three years ago. The two-way quad-core servers give the company lots of CPU cycles, so in many cases the IT infrastructure team has packed the servers with 32 GB or 48 GB of memory, increasing their purchase price from $7,000 to $10,000 to $11,000. To realize the gains of virtualization, you have to buy memory, Son says. Even so, he has spent $130,000 on Orchard Supply's 13 virtualized hosts versus the $875,000 it would have cost to buy 125 cheaper servers for standalone apps.

One way Son produced big savings was by moving to Microsoft per-CPU licensing for virtualized hosts. For example, he has spent $40,794 for Windows Server 2003 and 2008 licensing on his 13 virtualized hosts, each using two CPUs. If he had stuck to Microsoft Enterprise server licensing for 125 servers, he'd have spent $192,250.

Unlike many virtualization users, Son also put the company's Microsoft SQL Server databases into VMware virtual machines, then shifted from an enterprise/per-server license to per-CPU licensing, while at the same time reducing the number of SQL Server instances his team runs from 14 to eight. The switch put increased workloads on the company's eight virtualized database servers, but Son found after extensive testing that they could handle it. The savings: $22,500 ($30,000 for SQL Server licensing versus $52,500).

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