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5 consumption models help simplify storage buying options

Consumption-based pricing offers organizations flexible options to purchase storage and other infrastructure on-premises, just like they would cloud services.

Widespread adoption of the public cloud has seen a rise in new purchasing models for on-premises infrastructure. To stay competitive, storage vendors are delivering cloud-like consumption models that offer the flexibility and freedom already seen in the public cloud. These new purchasing and refresh programs offer customers storage on-demand and perpetual capacity usage choices.

Consumption-based pricing is an alternative approach to traditional technology acquisition. Where IT organizations typically followed a Capex model, many vendors now offer a transition to an Opex model. To use an analogy, we can purchase a car outright or pay a monthly lease to the manufacturer or dealer. A lease may eventually end in ownership or returning the vehicle at the end of the agreement period. At the far end of the scale, we can even rent a car by the hour or day. Each of these options offers a trade-off between committing capital to vehicle ownership or simply paying more to use a car for a period of time or only when needed.

Storage vendors now offer the choice of outright purchase, purchase with financing or some form of consumption model. Organizations can implement the consumption models as true "as a service" where the vendor continues to own the technology, or somewhere in between outright ownership and technology as a service.

Choosing which service to use depends on an organization's circumstances and requirements. But each option has its pros and cons. A business may need to commit to minimum capacity and usage period. The vendor shoulders the capital charge and the risk that some capacity may go unused. This means consumption-based services could be more expensive on a dollar-per-terabyte basis. However, organizations must consider factors such as unused capacity, power, space and cooling costs to calculate TCO over the lifetime of the storage needed. In organizations where demand is unpredictable, it may be less expensive to pay a higher unit cost for the weeks or months when capacity is required.

Is consumption-based pricing right for your organizations?

Billing and metering

To ensure accurate billing back to the customer, storage vendors have implemented tools and services to collect usage information and other statistics from on-premises infrastructure. Many vendors are using their existing analytics platforms to aid this management process, including data that shows consumption trends and forward forecasting on usage.

Here, we examine five leading storage vendors and their consumption-model offerings.

Dell Technologies On Demand

Dell Technologies introduced its On Demand program in late 2019. It consists of three components:

  • Pay As You Grow. The required infrastructure is deployed upfront, with customized payment terms as resources are consumed. This option allows an organization to use capacity as part of a forecast or as a buffer when required.
  • Flex On Demand. This option installs a base capacity with minimum commitments from 12 to 60 months. Buffer capacity enables the organization to expand or decrease usage as required.
  • Datacenter Utility. This option offers a monthly charge based on an agreed-upon rate structure and usage tracking. The customer is billed monthly based on usage.

The applicability of the Dell services depends on customer usage and other factors such as minimizing data center deployments and interventions.

Hewlett Packard Enterprise GreenLake

HPE has committed to offering all its existing infrastructure products through an as-a-service model by 2022. The enabler to this is GreenLake, a set of tools and financial options that deliver an operational consumption model. Customers order storage capacity through the GreenLake Central portal, with a choice of Primera or Nimble for primary storage and StoreOnce for data protection.

Within the storage portfolio, HPE divides requirements into the following categories that align hardware offerings to usage types:

  • HPE Primera for mission-critical;
  • HPE Nimble Storage All Flash for business-critical;
  • HPE Nimble Storage Adaptive Flash for general-purpose; and
  • HPE StoreOnce for data protection.

Storage offerings are further subdivided to meet performance requirements. For example, general-purpose offerings cover balanced and performance- and cost-optimized choices, each with a custom Nimble array configuration. Organizations are then billed based on consumption per gigabyte, with built-in buffers for additional capacity. GreenLake customers agree upfront to minimum time and capacity commitments.

Lenovo TruScale Infrastructure Services

TruScale is a consumption-based service that provides organizations with the ability to pay for Lenovo infrastructure on demand. The service requires no minimum commitment and is billed monthly. Lenovo uses technology built into server management chips to provide feedback on monitoring and use that then forms the basis of monthly charges.

Many vendors are using their existing analytics platforms to aid this management process, including data that shows consumption trends and forward forecasting on usage.

NetApp Keystone

NetApp introduced Keystone at NetApp Insight 2019. Customers commit to a minimum storage capacity and timeframe, and then they select from three performance levels -- Performance, Standard or Value -- and service offerings, such as file, block or object. NetApp installs and supports the equipment with a lead time measured in weeks.

Keystone customers either run the installation as IaaS and manage it themselves, or NetApp offers a managed service that customers can access through the Fabric Orchestrator portal. Keystone forms part of a range of service offerings from standard Capex to storage based entirely in the public cloud.

Pure Storage Evergreen

The Evergreen Storage subscription service is offered to customers purchasing FlashArray and FlashBlade hardware. Evergreen subscribers receive in-place technology refreshes of hardware controllers and storage capacity while a subscription agreement is in place. Two subscription models are offered. Evergreen Silver delivers ongoing and new software features, flat maintenance charges, analytics through Pure1 and service-level agreement guarantees. Evergreen Gold extends these features with controller upgrades every three years and the option for customers to consolidate capacity to larger drive devices.

Pure as-a-Service is a consumption-based model, formerly known as the Evergreen Storage Service, that offers storage either on premises or in the public cloud. Customers can choose from terms as short as 12 months and are charged per gigabyte of storage consumed, per month. Pure as-a-Service is delivered with Evergreen features, ensuring customers continue to receive upgrades and refreshes while paying through a consumption model.

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