Tool: Reading the Meter

Use the worksheet below to calculate the costs and benefits of implementing a network based on a pay-as-you-go approach. This example, taken from a model created by utility computing software vendor Ejasent, pools computing resourcse for an enterprise or a service provider to use in its own data centers.

Instructions: Only enter values in steps A, B, C, E and F below. The other values will be calculated automatically for you.


Step 1: The Basics
YOUR COSTSEXAMPLE
A. How many servers do you want to eliminate?

75
B. How many CPUs does each server have, on average?

4
C. What is the average total cost of ownership per server per year?

$$48,000
Step 2: Costs & Benefits
D. This subtotal will show how much you could save over three years.

$$10,800,000
E. How much will it cost to move the servers (listed in step A above) to utility computing?
Fixed setup fees begin at $50,000, but could range as high as $1 million.

$$250,000
F. What are your per-processor costs?
In our example, the meter runs at $2,500 per processor per year.

$$2,500
G. This subtotal shows how much usage fees would run over 3 years.

$$2,250,000
H. Net savings: This subtotal subtracts cost and use fees from the potential savings.

$$8,300,000
Step 3: The Return
ROI. Here, you’ll find the 3-year return on your investment by dividing the net savings by the total costs.%332%
Payback period. This shows how many months after setup you’ll see a return, assuming amortization over 3 years. months8.33 months
   


Full story
Find out more in Baseline‘s primer on utility computing.