There are two big problems with your IT budget. One: it’s not growing fast enough to keep up with exploding data growth, which is increasingly software-driven. And two: a large portion of your budget is essentially walled-off for “fixed” software licence costs. In the era of software-defined everything, we’ve found this portion of the budget to increasingly consume more funds each year – but it doesn’t have to. By fully utilizing the CPU cores you licence, you can use fewer licences across your deployment and save tens of thousands of pounds in the process. Here’s how and why it works.
According to Gartner’s 2018 worldwide IT spend forecast, enterprise software spend is projected to grow 7% versus an overall IT growth rate of just 2.6%.1 For many IT departments, enterprise software spend is the fastest-growing line item on the budget, which makes containing licence costs more important than ever before. Fortunately, this is easy to do because software licences are attached to CPU cores, which are fed by memory and storage. The more performance you get out of each processing core, the fewer licences you need, the lower your costs will be, and the more performance you’ll get out of the apps you’re licensing.
Here are a few enterprise applications used in almost every industry, plus a rundown of licence costs, how they’re priced, whether they’re memory and storage dependent, and how you can save.
The core-based licensing model that Microsoft, Oracle, and others have adopted for enterprise software allows you to create an unlimited number of VMs on each CPU core you’re licensing, which is great, but you have to take advantage of it. If you don’t create as many VMs as possible, your money doesn’t go as far. However, in order to create more VMs, you need more memory, as each VM draws upon the same pool of available memory, plus the virtualization software itself needs RAM to run. On top of that, the apps you’re likely virtualizing are memory-dependent, meaning they revolve around active data that lives in memory.
Effective virtualization also requires fast storage because virtualized apps often run out of memory, which triggers disk thrash. Since SSDs deliver significantly faster performance than hard drives, they allow you to maintain optimal performance even when you run out of memory. Enterprise SSDs also allow you to access, load, and save things almost instantly so you get the most out of your software spend. If you’re going to dedicate hundreds of thousands to software every year, you might as well get fast performance out of each and every app.
Since all cores running an app have to be licenced, the best way to save is to fully utilize each and every CPU core. If you only use your licenced CPU cores 50% of the time, you’re significantly overpaying for your software (unless the low CPU utilization is driven by your workload, which would make it expected and OK). However, if your bottleneck is hardware – the case for most IT departments – then there’s an easy way to save. Just fully utilize your cores because they’re what you’re paying for. And a lot of the time, CPU cores are left idling, waiting to get data from memory and storage.
The best way to ensure your CPUs run 24/7 is to fuel them with more RAM and fast I/O by swapping out existing hard drives for enterprise SSDs. For business-critical applications like Oracle Database and Microsoft SQL Server, swap out existing SAS hard drives for SAS SSDs. And in newer servers that’ll take drives with the NVMe™ interface, install those instead. Either way, both RAM and SSDs are a fraction of the cost of licensing a single server – here’s how it breaks down.
When you look at hardware versus software costs, it’s important to remember that licences hit your budget every year as an operating expense, whereas a hardware upgrade is a one-time, multi-year investment that benefits you for the life of the drive or module.
Software licences aren’t optional, but they don’t have to be treated as fixed costs. By investing a fraction of your budget into more memory and enterprise SSDs to fuel the applications you’re licensing, you can immediately start saving and improve performance. Spend a little now to save a lot every year through increased CPU utilization – and fewer recurring licences.