New Tool Calculates Virtualization Savings
VMware, the EMC subsidiary that leads the virtualization market, has a new, free tool -- the TCO Calculator -- that helps customers and solution providers alike see just how much the technology will save.
Here's how it works: Users of the online app enter the number of servers by CPUs. The calculator assumes the time it takes to configure one server and automatically computes the amount of storage, in gigabytes, in an organization based on the number of servers and asks the percentage of SAN-attached servers. Click the button and -- voila! -- the calculator spits out easy-to-read graphs and statistics on how much a company will save by deploying virtualization.
"We're not talking about single-digit improvements, but how building out a data center with 50 percent improvement," explains Bogomil Balkansky, VMWare's director of product marketing. "Customers and prospects can get an idea for what virtualization can do for them and use [the TCO Calculator] as a formal justification for the investment."
The intent is clear: demonstrate upfront how virtualization will reduce IT costs, thus providing a justification for bean-counters in finance and fiscally conservative CIOs.
The default calculator settings are for a company with 100 one-CPU, 500 two-CPU and 200 four-CPU servers. It's also set for 20 hours to configure an average server, 24,000 GB of storage and 25 percent of servers connected to SANs. According to the calculator, the cost of supporting this infrastructure over three years will cost north of $12 million. Through virtualization, though, the calculator reveals $7.9 million in direct savings and another $858,000 in indirect savings over three years. The analysis promises 607 percent ROI on an investment of $1.45 million.
The TCO Calculator goes beyond financials by providing an estimate on the number of servers and SAN and networking switches that will be taken out of service. And it computes the reduction in electrical consumption, cooling power and data center space (in square feet).
"It's an education tool for what they can expect in areas where they can save money," Balkansky says. "This TCO Calculator is the first step in helping customers identify and understand their virtualization needs."
The company hopes solution providers will use the TCO Calculator in their sales calls. Rather than just talking about the cost-saving benefits of virtualization, solution providers can sign on to the calculator, ask a prospect a series of questions and, in real time, provide the prospect with an estimate of what their investment will yield.
"We have other tools that work for hardware platforms, which many vendors usually charge for. Having a tool from VMware really helps us with customer sales and helps us add services," says Eric Wilcox, vice president of technology services at Computer Resolutions, in Shelton, Conn.
Wilcox is one of several VMware resellers who is already using the TCO Calculator to either sell new customers or upgrade existing customers on virtualization. Both Wilcox and Balkansky agree that the calculator isn't a replacement for a full network assessment or that it even provides complete or accurate results. It is -- as intended -- a baseline tool that serves as an entry point for understanding virtualization cost and savings.
"The TCO Calculator is the starting point of the assessment process," Wilcox explains. "The calculator will allow the customer or prospect to see the general view of their overhead costs of their server farms or hardware."
Some vendors and solution providers have had varying degrees of success with ROI/TCO calculators. Either they're not used because they don't give accurate enough data or they're results are too generic. In some cases, calculators aren't used because sales teams can't or won't adopt them into their sales methodology.
What makes the VMware TCO Calculator attractive is its availability to a broad set of users, and it's customizable. Users can adjust the settings, accounting for their unique operating costs and size of their infrastructure. The customization produces better results.
On the plus size for solution providers, the TCO Calculator requires end users to register before saving, printing or downloading the report. Those registrations end up in the VMware lead-generation database, which eventually gets turned over to channel partners.
A TCO/ROI calculator isn't a new idea. But VMware has gone a long way to ensure its calculator is practical, easy to use and generates positive results for all users -- particularly solution providers that are trying to help customers justify significant investments in virtualization. This is definitely a tool worth checking out.
Do you think tools such as VMWare's TCO Calculator can help generate leads and spur sales? Would you use a tool similar to the TCO Calculator? Share your thoughts with me.