Storage Toolkit

How firms justify storage spend

Tags:
Metrics,
Storage

Manek Dubash ZDNet.co.uk

Published: 04 Aug 2009 12:29 BST

Storage may seem cheap, but purchase price is a small part of the cost. That is why IT managers are having to find new ways of measuring the economics of storage, says Manek Dubash.

You might think there has never been a better time to buy storage. But if you are an enterprise IT manager, your budget is flat, and you are being asked to do more with less.

Yet we have never needed more storage and, driven by the huge growth in the use and storage of video, and by legislative requirements to keep ever-growing mountains of data, demand continues to increase. The precautionary ethos often becomes 'store everything forever, just in case'.

Can new technology solve the problem of never-ending demand? Constant price falls encourage this attitude. The raw cost of storing a terabyte of data on rotating media is now well below £100. Increasingly, too, the potential of solid-state disks (SSDs) is starting to be realised, although the cost per gigabyte seems destined to remain well above that of rotating media.

Acquisition costs
So far, so familiar. But buying more storage is being viewed increasingly as unsustainable at a time of flat or falling IT budgets, because storage hardware acquisition costs are only the most visible element of an iceberg of spending in this area.

According to IDC analyst Nick Sundby, managing the rapid growth of data while keeping it secure, protected, compliant and resilient is a challenging task that is subject to a complex set of changing user priorities, service-level agreement requirements and regulatory directives.

"Add in the budget and staff restrictions that are now commonly seen and the scale of the challenge is even greater. Faced with these restrictions, many customers can no longer buy storage capacity 'by the yard' to meet the company's growing demands," Sundby says.

So how do you make sense of today's storage market, when the technology is rapidly changing, when value-for-money equations seem founded on shifting sands, and the problem of managing demands for storage appears destined never to achieve resolution?

Econometric approach
Sundby says enterprises need to adopt an econometric approach to storage management. This technique combines the return on investment (ROI) and total cost of ownership (TCO) approaches to IT purchasing.

However, Sundby says if such approaches were simple to execute, they would be widely used to evaluate proposed storage investments. "The reality is that for many companies, the IT manager may be adept at evaluating new hardware and software technologies, but less confident in presenting a detailed financial model of the solution," he says.

In other words, IT managers need to find new ways of measuring the economics of storage in the knowledge that purchase price constitutes only 20 percent of the total cost of ownership. Those other costs include maintenance, management, security, and power and cooling.

As an example of how IT managers should be thinking, Sundby points to the approach of Hitachi Data Systems. "HDS has evolved an approach to storage economics based on some hundreds of TCO and ROI analysis studies that it has conducted with high-end storage customers around the world.

"[This approach] allows stakeholders to consider the financial benefits of a multi-tiered, thinly provisioned and virtualised storage architecture, which hitherto would have been a significant undertaking for some users."

David Merrill, chief storage economist at HDS, says the key objective is to measure...