Further into the background

Read time 8min 10sec

When virtualisation technology first started appearing in organisations, it was sneaked in by the IT department. Non-mission-critical services were virtualised, new development work slapped onto virtual platforms for ease of testing of new - and more importantly, old - environments. Even some aspects of disaster recovery (DR) were virtualised. But virtualisation as a foundation technology has now had more than enough time to show up on the enterprise's balance sheet as a no-nonsense way of saving money and increasing agility across the board.

Richard Vester, director of cloud services at EOH, says he's seen savings in three main areas.

"Firstly, it's saved companies time to deploy. There's no waiting for delivery of servers anymore. The second is around cost. Being able to share resources across infrastructure and across workloads saves corporates money too. And the last is in service levels. Service levels accrue costs but because the uptime is so much greater and deployment is much broader, it saves money."

It's not infrastructure that is going to drive cloud computing, but business applications.

Gary de Menezes, Oracle

Gary de Menezes, regional director, East and Southern Africa at Oracle, says consolidation has played its part.

"Across Africa, the biggest savings have really come from serious advancement in processing power and density of disk space. So it's been server consolidation, infrastructure consolidation and storage consolidation. Unfortunately, most companies aren't as far in consolidating as they think. Only now are customers looking at middleware, database and application consolidation and that will drive the next phase."

Pieter van der Merwe, availability solutions architect at Stratus, says disaster recovery specifically has garnered considerable savings.

"The space in which we saw large savings for virtualisation was disaster recovery. This is in the top end of the data centre, where the high-value business applications sit and where disaster recovery is an absolute requirement. Virtualisation made DR much more affordable and easy to implement."

Scott Orton, sales director at Triple4, says virtualisation has made certain aspects of IT easier, but that can't easily be quantified.

"There are a lot of elements of ROI that can't be quantified, including some tasks that were very difficult before virtualisation. If you have an environment where you need to test a product or upgrade a platform, with virtualisation in place you can create an entire development environment that you couldn't do before without loads of additional costs.

“The same goes for support costs. If you need to upgrade, say from Exchange 2003 to Exchange 2010, you can fully test it on a virtual environment."

Andrew McIver, senior technical consultant at Linux System Dynamics, agrees.

"Part of the speed of development includes the time to get the system back up after a catastrophic failure. Instead of rebooting physical machines and reconfiguring switches, a virtual environment makes it almost automated."

For the service provider, virtualisation has saved them power and space. Says Haydn Stone, managed services manager at IS: "We've seen considerable savings, the bulk of which we've been able to pass on to our customers, around data centre space, power and cooling, which is still very much the heart and soul of any service provider.

“On one of our virtual platforms, we have 600 virtual machines housed within three racks of physical equipment. We did cost calculations that showed power savings that seemed small, but when added up over a period of time turned out to be substantial."

True measurements

Despite the clear advantages of virtualisation, there are some shops that have found it difficult to measure ROI or even calculate their savings properly. Warwick Talbot, senior manager, technology consulting at Accenture, says he's seen real ROI doesn't really match what's expected.

"Either the virtualisation happens in point areas - companies decide to roll it out in specific areas and not across the organisation - or they don't finish the roll-out. So they get to virtualise a couple of apps but then find uses for the other servers that were to give them the savings and redeploy them somewhere else."

Jacques Malherbe, CEO of Westcon, says this is a maturity issue.

"There is a correlation between the sophistication of the IT shop and what projects are driven and what benefits accrue from them. The SME and mid-markets tend to reconsume resources saved by virtualisation so you don't see the savings directly in the clean ROI calculations."

Chris Norton, regional director of VMware Southern Africa, agrees that the sophistication of the IT shop plays a role.

"But a fundamental error that some companies made was that when they embarked on a virtualisation strategy, they didn't benchmark their costs then. So when it comes time to measure ROI, the only thing they could measure was capital savings. They're not seeing operational savings or DR savings.

“If I come into a customer and consolidate at a ratio of two to one, which is typical, then I'm halving their infrastructure. And by doing it, I'm also creating a DR strategy or freeing up resources for business continuity. But people discount that: they treat it as just another project and the real cost savings become subjective rather than objective."

Norton says this is common in very large organisations.

"There are some large banks in this country that have saved a lot of money from virtualisation. They know it's a lot of money but they can't quantify it."

Is the solution more management of virtual infrastructures? Stratus' Van der Merwe thinks so.

"Looking ahead, management is becoming much more critical because everything will revolve around the management of the virtual infrastructure."

A virtual environment makes DR almost automatic.

Andrew McIver, LSD

Alex Russell, resultant at Smartaxess, says the next step will be to make the infrastructure useful to everyone.

"Virtual infrastructure is pervasive and in the fabric now. The next phase is how to liberate the infrastructure and make it available. How do you make these tangible benefits available in something like an App Store? What's the flow of information going to be? Organisations shouldn't still be trying to justify an ROI. They should be in the next phase, which is the application phase because that's where the real efficiency from a business perspective will come from."

Westcon's Malherbe agrees.

"The problem we face now is that unless there's a problem to solve, the industry won't grab the solution. We're waiting for companies to understand that the next problem to solve is the intelligent enterprise that can aggregate a whole host of public services to make an enterprise good. There's also trust to be considered with third-party services. If I virtualise, then that's just me and I'm virtualised. The IT shop inside the enterprise should be able to aggregate third-party services and present them through an interface. Obviously we will need a proper digital platform to do that and obviously it will need to be managed."

IS' Stone says infrastructure is not irrelevant, though.

"I would like to challenge the statement that infrastructure is done and dusted and that we've moved on, especially in the service provider space. There are a lot of value-added services to be had at the service provider level that are not commoditised. You can't just tick a box and present them to the customer. There are a lot of technical challenges to make some of those services as seamless as possible.”

Beyond infrastructure

Oracle's De Menezes says the next step is the application.

"It's not infrastructure that is going to drive cloud computing, but business applications and the business benefits they will get from it. As IT we have complicated this to such an extent that we have had to come up with a solution for the customers.

“Where we are at the moment is that there are many service providers that have taken a lot of their old systems integration resources and used best of breed products to create cloud infrastructures. The application vendors are not cloud-ready, but once they start to get ready, we will see a major new drive towards new infrastructure and a better out-of-the-box deployment."

EOH's Vester agrees that it is the application and that will drive revenues.

"Some service providers have already moved into creating marketplaces where more SMEs can procure applications and deploy them, rapidly increase and decrease resources and move them around if needed. A lot of this is happening right now in some service providers. The challenge is: when will application vendors be ready to provide the right licensing around that?”

The delivery of business software is a serious problem for end-users at the moment. Louis Pienaar, portfolio manager, hosted services at Vodacom Business, has seen this problem.

"We've seen a lot of the application providers make their applications multi-tenanted so that we can present their applications onto virtual desktops. But as soon as you don't have an enterprise licence, there's $100 per annum that needs to be paid upfront and it's making it increasingly difficult for end-users to access the applications that are available."

But if history is anything to go by, then the users will force packaged software vendors to play ball.

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