Cloud computing has been the buzzword in recent times, due to its promising capabilities, and unsurpassable potential. However, the cost of delivering power to servers, and the server costs are two major concerns for IT operations, especially for all the midsize enterprises. So, the million dollar question of course is – ‘will cloud computing be a feasible option for the midsize enterprises and what will the main economic considerations be’; well, vice president of Amazon had something interesting to share with everybody.

In an extremely informative and influential presentation about data center economics, Hamilton gave a superb comparison between the economics for service provider, and an enterprise, though the focus was more towards the benefits shared by public cloud providers (no points for guessing Amazon) over enterprise data centers. So, let’s take a look at the key points covered by Hamilton that are applicable to one and all.

Large Computing Providers Have An Edge Over Others

Well, given the fact that large computing providers deal in large volumes, and hence they can offer better pricing. Taking this fact into account, server vendors always have inclination towards working with the big guns on custom designs; hence, they can offer the right combination of customization and pricing advantage, over the off-the-shelf components with the custom server designs.

And, it is quite evident that the average enterprises need to bear higher cost, and Hamilton estimated at the server, administration, as well as networking costs are about five times for the average enterprise than the cost, a large provider bears.

Server Costs & Cost Of Delivering Power To Servers.

More often than not, people tend to consider the cost of delivering power to the servers to be included within the server costs. However, as per some interesting stats and figures quoted by Hamilton, if you consider the economics in 10-year lifetime of a data center, the server costs account to about more than half of overall costs, while the power consumed by the servers is hardly ten percent. But, an astonishing fact is that when cost of delivering power as well as cooling these servers is also taken into account, it sums up to almost one-third of the total costs!

This clearly indicates that minimizing the cost of cooling equipments, and data center power can help in cutting down on operation costs big time!

Powering Off a server Isn’t The Way To Go!

Well, if you think you can power-off the server whenever it is not in use, and save a good deal of money, think again! Keeping the servers running all the time turns out to be economically more efficient than switching them off, when you feel that they’re not operational. But, of course, you need a huge customer-base of elite customers who’re willing to pay!

Quite clearly, it makes sense for IT vendors as well as customers to pay attention to the abovementioned aspects, and try to work things out, keeping these crucial aspects into consideration.