Doing the math on virtualization

Money is tight. Performance is declining. Your servers are all nearly three years old, and pretty soon, their high-priced maintenance contract is about to kick in. What do you do?

If you're like Tim Hays, you take the money you would have spent on maintenance and instead use virtualization to not only improve performance, but also increase IT efficiency, cut power and cooling costs by 45%, and make disaster recovery as easy as pushing a button.

"I guess I'm more of a business guy first and an IT guy second," says Hays, director of IT at Lextron, a wholesale distributor of animal health pharmaceuticals with 600 employees in 44 locations across 19 states. "I look at IT as a business enabler. Virtualization wasn't something that we did just because it was the next cool thing. It made a lot of economic sense."

Start small

Hays, who told his story at the Network World IT Roadmap Conference in Denver, didn't jump into virtualization all at once (see related story on more lessons learned). His first foray was in 2005, when he was faced with paying $300,000 over three years to maintain the three Unix servers and direct-attached storage units supporting his ERP, inventory management and sales management functions.

All told, the three servers were responsible for handling $1.75 million in sales transactions daily.

At the time, virtualization a la VMware was not well known. Instead, he used the $300,000 to replace the Unix servers with one PA-RISC-based HP-UX server running HP's Virtual Partition (vPAR) software, which enabled the one server to host three virtually partitioned servers. He also put the server on a Fibre Channel-based HP EVA 5000 storage-area network. (Compare storage virtualization products.)

"Cost-wise, it was a wash," he says, noting that the depreciation for the new equipment was $100,000 per year, the same as he would have been paying for maintenance per year on the old gear.

But reports now ran 30% to 40% faster, and user complaints declined. "People were waiting less time to get information, and they didn't have that problem where they were outworking the ability of the system to retrieve the data," he says.

At the same time, the company also needed to upgrade its ERP databases from Informix 7 to 9.4. "We had 1,500 programs that we needed to regression test against new hardware, a new database, new development tools and a new operating system," Hays says. Buying new equipment enabled Hays to install all the new software and thoroughly test everything before cutting over. Once his team was confident everything would work, they simply switched users from the old equipment to the new. The whole process, which could have taken six months in the past, took just 45 days.

Success breeds success

Faced with a similar situation on the Wintel side of the house in August 2006, Lextron once again calculated its options. The company had been using 40 physical servers to support its Microsoft Windows environment, including Exchange, SharePoint, CRM and Web services, as well as file and print.

"We had servers that needed to be replaced and we had a track record of taking multiple physical servers and combining them into one," Hays says. "Virtualization seemed like an obvious project to at least investigate."

The company decided to virtualize its 40 servers and run them all on a cluster of two HP x64 DL-360 servers, each with 20GB of memory and running VMware Virtual Infrastructure 3 (VI3) software.

Hays says the decision to use just two physical servers hinged on VMware's licensing costs. "It's just a math problem," Hays says. "I can buy more VMware licenses and spread them over cheaper servers, or I can buy more expensive, robust servers and fewer VMware licenses. I just projected the total cost of ownership for a 36-month period, and using these four boxes was optimal mathematically."

Plus, the move enabled Lextron to eliminate three racks of equipment, along with 45% of its power and cooling costs. And it increased productivity overall, especially in IT. "If someone needed a test server in the old world, you had to find a physical box and make sure it had the right physical features -- CPU, memory, the right network connection," Hays says. "Sometimes, we had to purchase a new server just to test a particular application. That's all eliminated with virtual machines. They're very easy to build up and take back down."

Plus, with virtualization and fewer physical servers, Lextron was able to go to the next big step, implementing what Hays calls "push-button" disaster recovery.

"Because of virtualization, we were able to rent a much smaller facility for a disaster-recovery center -- if you looked at it, you might even think it was a broom closet," he says. The [disaster-recovery] site has just two server racks, an inline cooling unit, and UPS and battery backup. Plus, Hays uses Vizioncore's vReplicator software to replicate virtual machines from the primary site to the backup site.

"I have virtual Exchange Server 'A' sitting in my production data center, and multiple times a day, Vizioncore takes a snapshot of everything that's unique about it -- the server, the database -- and it passes that data over to virtual Exchange Server 'B' at the [disaster-recovery] site," says Hays, noting that the disaster-recovery site is located 3 miles away and is linked to the production site via a 180Mbit/sec. connection. "From a command console, I can tell it to automatically switch over to Exchange Server B and run all my users, and my users wouldn't know the difference. It's push-button [disaster-recovery]."

Vizioncore cost $600 per server license, and Lextron uses it for 26 critical servers. "Twenty-six times $600 is less than $15,000," he says. "So it's another area where we just said, 'Why wouldn't we spend this money?'"

In the end, virtualization was just a no-brainer for Lextron. "I got more productivity from my staff, I got better utilization of the equipment that I had, I got a better return on the invested capital for equipment, and I reduced power and cooling costs," Hays says. He notes those benefits came on top of the savings he got in the first place, by buying the four servers and VI3 to replace 40 servers. "It was easy math."

Cummings is a freelance writer in North Andover, Mass. She can be reached at


This story, "Doing the math on virtualization" was originally published by Network World.

Copyright © 2008 IDG Communications, Inc.

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