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Taking price into consideration

How important is price when considering a storage solution?

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This past year was rough on technology companies, in particular the second half of the year was catastrophically worse -- fraught with disaster, a recession and even greater economic uncertainty. Now, twenty five percent of our way into 2002 it appears that the recession is almost officially 'over', yet many companies are still not taking chances -- they are not only cutting back on budgets, but are trying to find ways to operate more efficiently with the new tighter funding that they have. Finding ways to save on operational expenses, and yet still be able to run their business efficiently is a high priority on anyone's list.

Many point to centralizing or consolidating their data infrastructure creating a single point of management and backup as a way to save on operating expenses, decrease time to market and reducing costs.

In the past, expensive enterprise class solutions were easier to justify because of the return on investment (ROI) that these features brought to the table. Now though, customers are no longer willing or able to make enormous investments for a rich feature set, especially since a variety of companies are now able to offer these kinds of features for a lower cost. So yes, price is now a valid variable in determining whose solution to buy for centralization solutions.

You can consolidate in a variety of ways, depending upon your requirements, and this may be done with Storage Area Networks (SAN), high end SAN (with Enterprise software tools), Network Attached Storage (NAS), or with virtualization - which I believe can give you the best of both worlds as well as interoperability with existing technology.

Because business continuance is something that companies are taking more seriously, it is an insurance that few companies can afford to ignore. For smaller companies, the only alternative was to outsource to an SSP for remote replication. In all cases, finding a solution strategy that is cost effective may -- depending upon whose point of view you consider -- be as dangerous as not having one at all. I believe that even here you can consider price, especially if the solution can demonstrate robustness, feature sets, etc.

In summary, a company should not be afraid to put pricing higher on the list of priorities, especially in light of today's leaner business realities. Not to knock some name brands, who indicate that storage is around $0.15 a MB today, or others, who indicate that storage will be at $0.01 a MB sometime in the future, the reality is that there are solutions today that offer business continuance replication at below even the $0.10 a MB price point and consolidated storage at less than $0.05 a MB price point. At the very least, considering these alternative solutions may help you get better pricing with the name brand solution.

One rule of thumb to keep in mind is that, regardless of which vendor a company partners with, the more capacity bought up front, and the more hosts you attach initially, the lower your price will be overall and the better your long term ROI. Be sure to investigate how much licenses for features such as those described above will cost you as your capacity and host count grows. Otherwise you might be unpleasantly surprised in the long term when your needs grow dramatically and your investment continues to have to grow dramatically with it just to maintain the functionality that that sold you on the solution in the first place. Consider all your alternatives, you might just be pleasantly surprised.

This was first published in March 2002

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