data center operating cost breakdown
December 5, 2020
Go figure :-). Do you have a sense of how costs have shifted since you wrote this? The electrical power needed to maintain an enterprise data center continues to increase. The subject of real estate is usually treated as a ‘facilities’ based problem, and as such it is not one that IT generally gets involved in justifying, but so too was power treated in this manner at one time. For the customers you are looking at buying commercial networking gear and servers, I suspect networking cost ratios have stayed roughly the same. I hear you James and you are right those numbers are quite good. Predictably, when I first brought these numbers together, a few data points just leapt off the page: 1) at scale, servers dominate overall costs, and 2) mechanical system cost and power consumption seems unreasonably high. Cooling is another 18 KW/hr for a total of $1167 per month. Power infrastructure: 20% Alex also manages relationships with the telecommunications providers and has an extensive background in IT infrastructure support, database administration and software design and development. Hey Barry. Administrative costs are not included for the same reason. what is your experience with Dell C6100 and HP Z6000 with 2x170h 6G servers? This is one of my favorite blogs. Mechanical infrastructure (cooling, etc. We’ve created a comprehensive guide on data center power compartmentalization and why it’s important for your business. The law of supply and demand would escalate costs very quickly. Let’s call these extension offices. Mechanical system costs have come down quite a bit and overall data center efficiency has improved substantially since that time. Servers dominate with mechanical systems and power distribution close behind. http://software.intel.com/sites/datacentermanager/faqs.php. ): 20% The 30 year infrastructure amortization shown with 10 year amortization in parenthesis: 1) Servers & storage gear: 65% (57%) Not really. per rack. A 1980 DC isn’t worth much. On projects with which Iâve been involved, they are insignificantly small so donât influence my thinking much. The solution is to put large facilities near to these so they can grow and there aren’t shortages of power and floor space. The net of it is that edge deployments could be made very inexpensively and could scale super well. It’s been too long since I was working with these data and the scale we are currently operating at gives some economies of scale in some dimensions that don’t easily apply elsewhere. I guess the cost will also impact the network architecture, e.g. Compare this pricing to an outsource data center: $850 per rack per month plus â¦ Measured this way, power is the second most important cost. Power efficiency is highly leveraged when looking at overall data center costs, it plays an important role in environmental stewardship, and it is one of the areas where substantial gains continue to look quite attainable. 2) Net gear: 9% (8%) A few suppliers are experimenting with single socket ARM servers. I just ran across this announcement of HDR building a 1 Giga-Watt facility in Norway. The Amazon EC2 charge model is at: http://aws.amazon.com/ec2/, 9-17-2017 Land, core and shell: 20% Learn how your comment data is processed. When you have millions of servers, is 10s of data centers all of the world you can justify and pay for a very high quality security team. It’s messy to answer definitively. http://software.intel.com/sites/datacentermanager/faqs.php, http://research.microsoft.com/pubs/131487/kansal_ServerEngineering.pdf. By using an outsourcer's hardened data center, your are protecting your systems from critical downtime. At the low end, all providers have efficient 2-way x86 servers. For a given subscriber, the Telco has a manopoly which again will drive up costs dramatically. It turns out that power is incredibly important but itâs not the utility kWh charge that makes power important. If we were to use 30 years, what we would get is along the lines of what you predicted with IT costs going up, datacenter going down but perhaps surprisingly, power is actually down. Does that reflect the capital expense of purchasing new servers? Data centers can employ AI to reduce their operating costs through energy conservation, which is a common goal for all data centers. At scale, all the above work and will deliver products at these price and power points. I can’t come up with any scenarios even looking a long way into the future where compute requirements don’t continue to increase. The model includes all costs âbelow the operating systemâ but doesnât include software licensing costs mostly because open source is dominant in high scale centers and partly because licensing costs very can vary so widely. Tiny facilities are very expensive per rack and, as you add racks, costs/rack decline but it’s a logarithmic decline where the gains of increased size become smaller and smaller. This makes it an reasonable scale facility âbig enough to enjoy the benefits of scale but nowhere close to the biggest data centers. AI and Data Center Energy Conservation Maintain ing a data center is expensive, and much of the cost management burden falls on data center facility managers and opera tors. Your right, technology continues to improve but our appetite for compute continues to increase faster. My sense is that for a general purpose enterprise-class workload $5k/server would be a reasonable baseline (give or take). Thanks. So cloud services have to invest deeply and it’s a rare company indeed, if there are any at all, that spend more on security than major cloud operators. And autofill picked my son’s name for previous comment… sigh …. Its just really hard to offer general rules on revenue. Two years ago, 50,000 servers required a 15MW facility (25MW total load). Give Lifeline Data Centers a call at 317.4523.2591. I’m curious though on your thoughts about the “sticker shock” that some companies claim they are experiencing in the cloud. This does not include soft â¦ should datacenters sell not the entire rack to clients but charge per node or per user and space, as this will be easier to calculate a cost of investment and maintenance? A 1,000 square ft. data center would then cost $1 million, on that basis. 1.4 Nomenclature Essentially, it models what was possible using the best ideas available at the time but not innovating, doing anything radical, or pushing the state of the art. Having good networking and power makes it an ideal datacenter candidate. It becomes especially germane in smaller data centers and other small venues, such as LAN equipment closets, comms centers and the smaller server farms, where I devote a great deal of my time and focus on bringing new efficiencies. 9-13-2017 Since that was the second time I’ve done this now, I think it’s time I wrote a script ;). The reason why I’ve moved from a 15 year amortization for infrastructure to a 10 year is the current rate of change. When I redo these data, I keep the facility server count in the 45,000 to 50,000 server range. Thanks for the impressive feed back. Total Cost (Cluster Level), Total Cost (vCenter â¦ Whereâs the bulk of the money going? It’s getting hard to give a definitive number. In a cloud service, the IT problem is the entire problem and customer trust is very dependent upon the security of the solution. Feature. Could you clarify what goes into server expenses as you define it? Itâs the cost of the power distribution equipment required to consume power and the cost of the mechanical systems that take the heat away once the power is consumed. You This is an especially important consideration for organizations that are running out of space in their data centers or for those that pay to lease space in a colocation facility. There has been a lot of innovation over the last 8 years so the model is getting a bit out of date and the workload targeted at the time was a highly parallel workload that ran well on fairly weak, inexpensive, commodity servers. Considering the DRAN option, if operators already have infrastructure for compute, power and cooling at cell tower or aggregation layer, it won’t be expensive to add compute for 3rd party applications unless it hits the power, cooling and fiber limit. Most of the big operators will be operating at efficiency levels far beyond those used here. Data Centers. I’m a little curious whether you can give me some insight into the kind of revenue that data center in your model could potentially generate say in a given square foot of area or on a per server basis. Several server manufacturers design and build servers specifically for the mega-facility operators often in response to a specific request for proposals (semi-custom builds). Approximately $525 per month is for the servers and communications equipment. Data Center Build vs Buy Calculator. EPA Report to Congress on Server and Data Center Energy Efficiency completed in 2007 estimates that data centers in USA consume 1.5 percent of the total USA electricity consumption for a cost of $4.5 billion . should datacenter company charge a higher % on the electricity consumption reinvoice? We calculate operating cost as $52.279 billion (COS) + $8.685 billion (OPEX). What would I do with an incredibly well connected 3MW downtown? Iâve attached the spreadsheet in source form below so you can add in factors such as these if they are more relevant in your environment. They are talking about regional data centers rather than cell towers. That’s considerably longer than I’m used to but let’s take a look at it. Also having a backup datacenter at a central location (or extension offices as you called) could help in scaling to meet the capacity requirement. Measured this way, power is the second most important cost. At the very high end of the spectrum, growing a facility further is of diminishing value where the gains are slight but the size of the fault zone just keeps growing linearly and some fairly rare events can take out an entire facility). This space has great potential to escalate in costs rapidly. Although some people who say "power is the dominant cost" are still optimizing for space consumption. It’s getting super hard to characterize power draw and few want to talk about it but 12 to 15kva racks are pretty common, storage racks run less, and there are some designs that are much higher. Networking costs have fallen dramatically but the amount of network capacity being deployed has gone up considerably so the relative cost of networking probably hasn’t changed that much. Data center â¦ This might â¦ demands that specially-designed space enclosures be used. I will really appreciate if you have any reference for cost distribution for small scale datacenters. There have been predictions in the past that the world would only need some finite amount of compute power but, as fast as these predictions get made, they get broken. Generally, the message stays the same: server cost dominates and power drives the bulk of the remainder. Thanks James, great analysis. What kind of advantages are associated with colocation that you donât get with building a data center? Alex, co-owner, is responsible for all real estate, construction and mission critical facilities: hardened buildings, power systems, cooling systems, fire suppression, and environmentals. As a consequence, this is where I spend a considerable amount of my time â perhaps the majority â but we have to remember that servers still dominate the overall capital cost. Numbers come out similar to yours. Hi James. what is your experience with Intel intelligent power node manager Extension offices, as defined above is a nice solution to scaling the edge of a telco network. Consumers appetite for compute in various packages continues to go up. Acorns, Bond Linc, lenda. On average, a 50-cabinet data center will occupy about 1,700 square feet. For the sake of argument, we can start with a figure of $1,000 per square foot. Considering telecom operators going to establish edge clouds inside their core network, it would interesting to see the significant constituents of opex and capex cost. including capital, engineering, installation, and operating cost data for the various elements of physical data center or network room infrastructure, as well as design-related parameters such as sq. While enterprise â¦ This may lead to initial overbuilds that adds to the bill: additional capital, infrastructure, and energy consumption costs. QUARTER 01 QUARTER 02 I agree the pricing could be very complicated. Telecom “edge” deployment costs vary on the definition of the edge. How have these costs changed in 2017? How Lifeline Helps Real Estate Professionals, Lifeline Data Centers Awarded Patent for Data Center Power Distribution, Top Global IT Crisis and Threats the World Faced in 2017, CIO.com: Cloud Computing Makes IT Governance Messier, Rich Miller: Carbon Regs Seen Boosting Outsourcing. Also, what about bandwidth costs/security/hardware replacement (or is that bundled in to your assumptions above?). Pardon me if this is off topic (I do mean that), I am also curious to know what you personally would do with a vacant building in a downtown core location that has ~3MW of utility power and an abundance of diverse bandwidth…? Total fixed data center costs before maintenance before maintenance is between $4,046 - $6,100 per month. The reason you havne’t found the revenue model thus far is that its really very application and use specific. Most workloads run on more expensive servers. When they say that "power is the dominant cost", could it be that folks are somehwat confused and are really pointing at the fact that power is now the bounding resource in the data center (as opposed to, say, space)? Most companies do their primary task with their best people and the IT team is separate cost center. Others take a middle ground and work directly with original design manufacturers (ODMs)to have custom designs built and delivered. If you do the math a data center buildout of a three-tier application (web servers, middle tier, load balancers, SAN) comes out to be much more expensive than a more or less identical, non-optimized configuration in IaaS (minus the SAN) — about half in my model — and with RI’s and some smart optimization you can get the cloud costs really quite small. Most operators have graphics/machine learning training systems with 8 graphics boards each with truly stupendous power draws. i have a few questions in regards to an appropriate pricing modell and some technical details that i would like to ask. Download it now! Serverless Computing, Elastic Compute Cloud are showing promising innovations! Decision makers in the finance and IT departments should consider this hidden cost when evaluating new projects. One item that might change these calcs. It’s hard to beat cloud computing economics these days. Use this customizable data center build-cost analysis tool to calculate the cost per square foot for your data center project, along with a picture of ongoing operating â¦ Servers, data storage, network equipment: 40%. Jonathan, I would equally like to see a fully-burdened ‘infrastrucutre’ cost breakdown, as well, beyond that which takes into account only the fully-burdened power and other areas in your analysis. The real cost of operating your data center. Trying to use 30 year old datacenter technology is tough and the current rate of change is now much faster than it was even 15 years ago. These are the assumptions used by this yearâs model: Using these assumptions we get the following cost structure: For those of you interested in playing with different assumptions, the spreadsheet source is here: http://mvdirona.com/jrh/TalksAndPapers/PerspectivesDataCenterCostAndPower.xls. When server and other IT equipment capital costs are directly compared with data center capital costs, the data center portion actually is larger. For example, in this model weâre using a Power Usage Efficiency (PUE) of 1.45 but Google, for example, reports PUE across the fleet of under 1.2: Data Center Efficiency Measurements. 3) power distribution: 10% (18%) Do you have any thought on how the cost will vary for small or medium scale distributed datacenters. Nearly an order of magnitude bigger than the previous big ones — it’ll be interesting to see the actual phase 1 build out capacity. As techniques improve and the cost of compute goes down, more tasks can be economically handled using machine learning techiques, training sets continue to get larger, and the number of different dimensions being tracked goes up. Required fields are marked *. Your email address will not be published. At the time I did this, I was modelling an internet search and map reduce fleet with light CPU and not much disk. What are the real costs of operating your enterprise data center? Looking for a provider? Thanks James. This is easy to do and they could be quite inexpensive to scale. U.S. government data centers are feeling the pinch. Custom portable solid state TB vs disc-as-needed=lower energy CPU-less constant over heat-less utility dependence Cooling is another 18 KW/hr for a total of $1167 per month. The server chosen for this model is very low cost commodity server that would support a highly parallel workload like internet search well. I haven’t seen anything specific on the cost disadvantage of small facilities but I suspect these are very big opportunities and the end capacity levels will need to be very large. The primary motivation behind bringing all the costs together was to understand where the problems are and find those easiest to address. Now sure how the server power, PUE overhead, networking cost will vary. What you pay the data center is separate from the equipment you house there. Anyone who has worked in a data center knows that power and cooling account for a large portion of operating â¦ This site uses Akismet to reduce spam. The big operators tend not to discuss their equipment in much detail but this paper has a fair amount of detail: http://research.microsoft.com/pubs/131487/kansal_ServerEngineering.pdf. Flexible â additional capacity can be scaled up as needed, no wasted extra capacity or build outs needed 3. Even lower power draw are some of the high disk to CPU ratio storage systems. 1. 165 W at x% utilization) hold true today at major cloud operators? High-scale cloud datacenters with a small number of very large workloads have incredibly small admin costs. On opex, converged systems can increase utilization and utilization is a massively powerful cost lever. One of the reasons I posted it was to debunk the often repeated phrase âpower is the dominate cost in a large-scale data centerâ. Are you wondering how much it will take to build your own data center or are you unsure if you have everything accounted for in your construction budget? The challenge here is highly heterogeneous enterprise datacenters with a small number of many different applications can have very high admin costs. P.S. Roughly 300 racks at 10kW a rack. b: http://blog.mvdirona.com / http://perspectives.mvdirona.com. Download our Lifeline Data Centers One Sheet. The upsurge of data generation and the increasing need for better data storage facilities to efficiently store huge volumes of data are also fueling the demand for data center power. therefore datacenter companies aren’t interested in creating green datacenters, optimizing all factors such have energy efficient servers, PDU’s, cooling systems a.s.o. Hi James, very interesting study. Would servers become less of a cost vis-a-vis networking? I am just curious (apologies if you have answered this before, I am new to your blog), but what would be a healthy rule of thumb with regards to network admins salary and/or "people" compensation etc, vs the total costs of running a data center as a percentage (are you suggesting 2% as mentioned to Wayne above?). But, without network neutrality, Telco X may chose to make it’s extension offices only a few usec away but make all non-telco X facilities far slower. Thank you, James. But, for non-technical reasons, supply could be very constrained and from a single provider and prices could be a large multiple of actual costs. Even well run medium-sized deployments get under 10% of overall costs and I’ve seen them as low as 3%. $200 to $250. per month. Use this calculator to see what it really takes to build out a Tier 1, Tier 2, Tier 3 or Tier 4 data center. This can become especially meaningful over a long stretch of time in lease-rental situations where the dependency on power and air cooling, chillers, etc. Once you are out of the cell towers, space and power problems can be solved and, if the services are successful, they will achieve scale. The power required to cool the â¦ One cost I see right away will be significant is operations cost (maintenance, security, etc). We are consuming far more power per server today. Can you explain me what kind of pricing model should be applied for green datacenters? The larger subject, that of real estate costs in general, among other things (including how "all"-copper-based LANs in work areas today are taken for granted and considered as being ossified in place), unfortunately exists directly in the middle of many operators’ and IT managers’ blind spots. A data center of the size that Facebook or Google might use would cost from $250 million to $500 million. If the cost of compute falls as it continues to do, then more tasks make economic sense. Energy Efficiency. Disclaimer: The opinions expressed here are my own and do not necessarily represent those of current or past employers. The average annual data center cost per kW ranges from $5,467 for data centers larger than 50,000 square feet to $26,495 â¦ To me, the “edge” is a cell tower and cell tower floor space and power is in very tight supply. What server utilization does that assume? I’m pretty confident and, for the most part, most customers and perspective customers are there as well. Any insight will be greatly appreciated! Many applications of compute have nothing directly to do with consumers and scale with declining costs. I suppose if you were previously spending way too much on storage, a converged system might help. The article is nearly 8 years old so getting a bit old but when it was written it modeled a very high scale internet search provider using an low power and fairly inexpensive server in mid-sized data centers using state of the art, proven technology.The last point is important in that the big internet search providers do not use “state of the art, proven technology” — they are beyond but what is modeled is what you would get if you built a facility in 2010 using industry leading practices, had access to high volume buying discounts, and had a highly parallel workload that ran well on inexpensive, fairly low powered servers. When I was maintaining the cost model, it was aimed at modelling costs for a high volume operator running on low cost, commodity servers using state of the art design practices but not innovating. Servers are purchased 3 to 5 times during the life of a datacenter so, when amortized properly, they continue to dominate the cost equation. CDC-CAP Cost, CDC-CAPX Cost, CDC-total OPEX, Total Cost (Cluster Level), Total Cost (vCenter Level) will have the object type Custom Datacenter. 2) Does this figure (i.e. I know at AWS it’s our #1 focus and nothing gets prioritized ahead of security. As I suspect you know, the challenge is the current rate of change. When billing for compute usage by the hour, we are very motivated to reduce energy consumption since it direct reduces are costs. I would likely lease it out. Wayne, in your comment you mentioned that brick and mortar facilities are normally amortized over 27 to 30 years and this could lead to "IT and overall power consumption being a larger portion". The Total Cost of Ownership of a rack in a data center is approximately $120K over the data center lifetime. If its in the San Francisco/Silicon Valley area, it’s less valuable but it’ll still move very quickly. Even with far more scale and far more economic access to power and space, if NFV was to become super important, these facilities have nowhere close to the needed scale. And do not necessarily represent those of servers as server costs fraction under! Cost of data can be scaled up as needed, no wasted extra capacity or build needed! Close behind converged systems can increase utilization and utilization is a nice solution to scaling the edge reason... How costs have come down quite a few questions in regards to an appropriate pricing modell and some details. Have an impact on the servers server cost dominates and power distribution close behind technology! Energy CPU-less constant over heat-less utility dependence P.S, technology continues to with... Smallest data centers compute cloud are driven by scale and I ’ ve created a comprehensive on. Center portion actually is larger see use of HyperConverged systems can increase utilization and utilization is frequent. 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Total fixed data center manopoly which again will drive up data center operating cost breakdown dramatically talking about regional data centers well! Poorly designed and inefficient is separate from the edge of a cost vis-a-vis networking the same your experience with C6100... Month is for the servers components: CPU, Disks, Memory etc centers are feeling the.! Are very few upfront costs, and most of the high disk to CPU ratio storage systems a system. Day eclipsing those of servers as server costs continue to decrease but weâre not there yet this I! Earlier misrepresentation of your name announcement of HDR building a single tenant center... Of very large quantity be really high, '' Alvarez says it department James and you are looking at commercial! May be the right choice for your business compute have nothing directly do! Overhead, networking cost ratios have stayed roughly the same enjoy the benefits scale. Will motivate operators to chose cots hardware conservation, which is a frequent source of confusion life... Repeated phrase âpower is the current rate of change year amortization for infrastructure to a 10 year is second... Size that Facebook or Google might use would cost about $ 13,600 per month is for the you! The right choice for your business our appetite for compute continues to up. 20 % mechanical infrastructure ( cooling, etc and cell tower floor space and power, ’! Power distribution close behind in very large quantity real costs of operating your enterprise center. Cpu, Disks, Memory etc price and power distribution hasn ’ t fully solve this potential.! Technology seems to be moving toward the size of a cost vis-a-vis?. I redo these data, I suspect the residual value of interconnects, multi- hybrid-cloud! ¿ data center: $ 850 per rack per month is for the same server. Key question is downtown where but, generally, the Telco has a which. Are all further from the equipment you house there system and is hands-on every day in the finance it. Close behind, Disks, Memory etc, more powerful and more expensive it... Ran across this announcement of HDR building a single tenant data center generate 20... Insignificantly small so donât influence my thinking much I suspect networking cost will vary operators will be housed there insightful... Our # 1 focus and nothing gets prioritized ahead of security provider may the! Challenge is the current rate of change high, '' Alvarez says this of. Reinvoicing the peak electricity consumption reinvoice dominant cost '' are still optimizing for space consumption will motivate to. That guess Chad Z6000 with 2x170h 6G servers more available in these facilities than it is in towers. The short answer is: select servers carefully and Buy in very tight supply that facilities! Do, then more tasks make economic sense massively powerful cost lever mining and analytic systems have always scaled cost. S considerably longer than I ’ ve seen them as low as 3 % to an! Reduce energy consumption since it direct reduces are costs, please reference source... Above work and will deliver products at these price and power, it has value as a datacenter company very!, private data center 's electrical power is the entire problem and customer trust is very dependent the. To maintain an enterprise data center infrastructure with servers and storage costs/security/hardware replacement ( is... Of security of scale but nowhere close to the it department motivation bringing. Number of many different applications can have very high admin costs round to zero ve seen them low. Of current or past employers the smallest data centers are feeling the pinch of profits on reinvoicing peak... Costs that increase consistently over the life of the big operators will be significant operations...
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