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Four ways to reap the benefits of virtualization through budgeting

Budgeting is critical to virtualization success. To get the best cost savings and enjoy the benefits of virtualization, plan your budget for the hypervisor, hardware and more.

One of the main benefits of virtualization is the cost savings. In a virtualized infrastructure, you save on the physical servers, data center space and power and cooling costs associated with a physical infrastructure. All these virtualization cost savings are real. But as the saying goes, nothing in life is free.

Even in a virtual infrastructure, you must establish a budget for new purchases, ongoing support and software licensing costs. You may have to make compromises to get the best price and performance fit for your environment. To fully reap the benefits of virtualization, there are four important factors to consider: choice of hypervisor, software licensing, hardware and training.

Choosing the right hypervisor
A hypervisor is the foundation of a virtual infrastructure. Choosing the right one is the first step toward realizing the benefits of virtualization.

Some hypervisors are free, and others cost many thousands of dollars. The size of your deployment, the desired features and the software you’ll need to support the infrastructure will all affect the total cost. If your goal is to create a test environment, or if you’re a small business owner, for example, you might not need redundancy or other advanced features. That can be a source of significant savings.

VMware hypervisors are often a better fit for Linux distributions, but if your workloads are mostly Windows-based, Hyper-V may be a better fit. Also, consider each vendor’s strength of support.

Software licensing decisions
In terms of reaping the benefits of virtualization, software licensing issues may be a more important factor than your choice of hypervisor. Software licensing affects the management, protection and monitoring of all your virtual machines (VMs), and hypervisor vendors see software licensing as the major revenue generator of server virtualization.

VMware vCenter, Citrix XenCenter and Microsoft System Center  offer all-encompassing tool sets for your virtual infrastructure, or you can pick and choose products for specific management and backup tasks. There are also many third-party vendors in the server virtualization market. VMware has the largest base of third-party vendors, but support for other platforms is increasing.

Here are a few other software licensing considerations that can bring virtualization cost savings:

Beware products licensed by the socket, as opposed to those licensed by the CPU core. CPU cores multiply with every new generation of processor. If licensing is based on cores, upgrades to more powerful hardware could increase costs unexpectedly.

  • Ask for multiyear, locked-in prices. This software licensing method helps you budget accurately as your infrastructure expands.
  • Ask for a support package to be thrown in. Hypervisor vendors know that once you’re fully vested in their product and your infrastructure has grown, it’s tricky to migrate to a competing vendor. Use this bargaining power to demand a support package.
  • Ask for a back-out clause, which allows you to return the product if it doesn’t meet your expectations after a period of time. The time frame for “backing out” is usually about three to six months after a contract is signed. A contract with the vendor should define what the product provides, and what you as a user expect from it. Be wary of a vendor unwilling to put these expectations in writing.

Choosing the right hardware
When it comes to benefits of virtualization, the decrease in hardware is a big one. Your hypervisor and supporting software choices may affect which hardware you purchase, based on vendor compatibility and other issues.

Virtualization is a shared-infrastructure technology, so cheaper is not always better. Your goal should be to gather enough resources in your hosts, network and disk subsystem to meet future needs. The resources you choose for your hardware infrastructure have a direct effect on your VM-to-host ratio. When it comes to server consolidation -- one of the major benefits of virtualization -- this consolidation ratio is key.

Luckily, you can fairly accurately assess your hardware needs by determining how much a VM costs per slot. Lately I’ve seen between 25 and 35 VMs on a system with two quad-core CPU, 64 GB-96 GB of RAM, and 4G B fiber channel attached SAN drives. If a pair of clustered hosts cost $22,000, network ports cost an average of $150 per port, Fiber ports cost $200 per port, pro-rated costs of a SAN are $10 per GB and backup infrastructure costs $1600, the VM-per-slot cost is about $1,000 to $1,400. You can even use this direct budgeting number to develop a chargeback model.

But also remember to be flexible. When server virtualization is done right, it brings incredible virtualization cost savings, but adjusting to new costs is critical. New server purchases will decrease dramatically as a result of server virtualization. But as the environment matures and more important production workloads become the standard, storage and networking purchases may begin to increase, because of the more centralized disk-resource requirements. Also, you never know when you’ll need more backup capacity.

The cost of knowledge
Despite the many benefits of virtualization, the reality is that server virtualization adds a whole new layer of software knowledge. You could put your organization at great risk if the virtualized infrastructure isn’t architected correctly or doesn’t have the correct recovery mechanisms.

If your staff has only limited training with management products, virtualization could end up costing you more money. Proper training (and sometimes outside consulting) is critical in the early stages. Personnel costs are often one of the first areas eyed for cuts when licensing and hardware costs start to rise, but you should fight to keep these costs in the budget.

Once your organization has made virtualization a standard, continue looking for ways to refine costs by reexamining vendors, hardware and procedures. Be aware that costs may shift between departments as the server platform evolves. A well-planned budget will help you adjust to these changes.

How do you budget for server virtualization? Share your thoughts at VirtuallyAware.com

About the expert
Rob McShinsky is a senior systems engineer at Dartmouth Hitchcock Medical Center in Lebanon, N.H., and has more than 12 years of experience in the industry -- including a focus on server virtualization since 2004. He has been closely involved with Microsoft as an early adopter of Hyper-V and System Center Virtual Machine Manager 2008, as well as a customer reference. In addition, he blogs at VirtuallyAware.com, writing tips and documenting experiences with various virtualization products.

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