The Hidden Costs of Unmanaged Storage

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Efficient corporate fiscal management dictates that IT departments run their operations as mission critical and also provide maximum services at minimal costs. Chief Information Officers (CIOs) have long faced the daunting task of carefully evaluating what infrastructure expenditures offer the most cost-effective solutions available to support a company’s applications.

It’s no different within the storage realm. In terms of seeking out the most cost-effective solutions, a widely held belief has been that unmanaged storage is easier and less expensive to acquire. This presumption seems to be showing its age, though, as it has been recently demonstrated that the hidden costs associated with unmanaged storage actually make the total cost of ownership much higher than originally thought.

The Total Cost of Ownership (TCO) Manager for Enterprise Storage Management, a new tool from Gartner, has demonstrated that many data centers are spending too much money on storage management. According to Gartner, unmanaged storage has hidden costs that make it more expensive, but the company says this can be avoided with the adoption of storage area networks (SANs).

Many people, though, still believe that direct-attached storage (DAS) is less expensive to add than fabric-attached storage technologies such as SANs. “That statement is true,” says Jon Greene, director of product management at FalconStor, “if one only looks at acquisition costs.” However, he says, “those [costs] are only a small percentage of the total cost of ownership. With analyst reports indicating that storage management expenses represent approximately 2/3 of the total cost, the benefits of a centrally managed SAN greatly outweigh the greater capital expenses for high-end customers — and increasingly, the mid-range as well.”

“If It’s New, It Must Be More Expensive”

Ken Steinhardt, director of technology analysis with EMC, believes the “if it’s new, it must be more expensive” cliché stems largely from a misperception that something new must be, by default, more expensive. “In fact,” he says, “Merrill Lynch and McKinsey & Co. have conducted studies that conclude exactly the opposite, with both SAN and NAS implementations having less than ½ the TCO when compared to DAS. The greatest area of difference was in the costs associated with staff resources, which is impacted by storage management requirements and storage management tools.”

What we must keep in mind here is that the support and management of direct-attached storage will eventually reach a point where certain aspects of the storage TCO begin to drive unit costs higher than other storage topologies. “The support and management costs alone for DAS can actually exceed the total costs for networked storage,” asserts Steinhardt.

Greene agrees and says that not only is DAS less efficiently used from a capacity perspective (it is generally over-provisioned because expanding capacity is a difficult process), it is also less efficient in terms of the burden it places on other IT resources – both human and technological. “Because DAS is distributed across servers, provisioning, data protection, and disaster recovery services generate significantly greater administrative and software license expenses while also increasing the processing burden on mission-critical server and network resources.”

Page 2: And the Winner Is?

And the Winner Is?

The current rule of thumb, according to Gartner, is that enterprises that exceed 12TB of usable storage through 2004 will find greater storage TCO per gigabyte from the implementation of SAN technologies. Greene believes that the combination of rapidly declining SAN storage costs and advances in SAN storage management have dramatically reduced the break-even point between DAS and SAN. He also says that early SANs generally lacked centralized control, so the SAN provided common access but not common management and storage services.

“As SAN management, virtualization, and SRM tools have matured, it has become possible to set and control SAN provisioning and data protection policies from a single console – with corresponding reductions in SAN TCO,” says Greene. In addition, he contends that SAN infrastructure costs are declining at unprecedented rates and are being driven by the increased volumes common to mainstream adoption and the implementation of new, standards-based technologies such as iSCSI. “For the foreseeable future, SAN TCO will continue to decrease faster than DAS TCO – enabling penetration of SAN technology into mid-range organizations.”

Steinhardt believes that as hardware costs continue to fall and the costs associated with staff resources continue to rise, the optimal IT infrastructure will be one that provides administrators with software tools that allow them to more effectively monitor, manage, and provision networked storage hardware resources. “The best tools allow for policy-based (aka automated) management, as it is more productive to allow storage administrators to apply policies than to have to manually address all issues, no matter how productive the software tools are for manual management,” says Steinhardt.

A poorly managed operating platform (hardware/software) usually results in an unstable computing environment. The concept of unmanaged storage is central to any discussion regarding enterprise storage because properly managing storage is a critical ingredient to the stability and cost effectiveness of an organization.

The Hidden Costs of Unmanaged Storage is a two-part article. The second part discusses other issues associated with the ongoing debate concerning the hidden costs of unmanaged storage. Jon Greene from FalconStor and Ken Steinhardt from EMC will answer a number of additional questions, including:

How can enterprises avoid the hidden costs of unmanaged storage?

As storage quantity increases, the total cost per gigabyte for all three storage types decreases, but does DAS/SDAS decrease at a faster rate than SAN storage?

If a data center is doubling its storage every 18 to 24 months and has more than 5 terabytes (TB) of usable storage (6 TB to 10 TB installed), should it evaluate the cost benefits that a storage area network (SAN) approach could provide in managing the TCO?

Do enterprises (in general) understand the composition and drivers of storage costs?


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Leslie Wood

Leslie Wood
Leslie Wood
Leslie. Wood is an Enterprise Storage Forum contributor.

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