Storage has long been a monolith of data center components. The shiny new arrays were deployed in forklift upgrades in multi-year refresh cycles, and it didn’t take long for them to lose their luster, become complicated to manage, and lag in performance.
At the same time, the cloud has emerged and made pay-as-you-go a standard that always maintains a spark of newness for the customer. It offers flexibility in use, deployment, upgrades, scalability, and speed of development and deployment, with the promise of better cost efficiency.
And so storage suppliers adapted. Buying options now range from full ownership with lifetime upgrades to pay-as-you-go with storage and performance upgrades powered via AIOps monitoring.
In this article, we take a look at storage consumption models, the pros and cons and what is available from vendors.
What is the traditional storage (and IT) refresh cycle?
The traditional storage refresh cycle occurs every three years and entails the complete replacement of all storage infrastructure with new hardware. that it Capital purchase Full ownership is transferred to the customer, with licensing and support contracted from the supplier from then on.
There are some benefits to the traditional storage refresh cycle. This includes the customer receiving a brand new set of devices, with sufficient capacity and power for the storage controller, as well as confidence in the security and software update status of the device. Customers will likely see a significant performance improvement after the update.
Often times, new equipment will be more energy efficient and need much less maintenance, both of which reduce costs. Scalability will be enhanced and new systems are likely to provide flexibility and better integration with newer components of the broader infrastructure. Here, think about cloud connectivity or containers, for example.
What are the main challenges of the traditional modernization cycle?
Most things that are considered beneficial in traditional buying cycles can also become downsides. While the equipment may arrive shiny and new and working well, with a great deal of portability, performance will likely deteriorate over time.
With storage, increases in the size of saved data can impact performance and reliability. Technology advances, and what was fine a couple of years ago may be in desperate need of an upgrade now – and older hardware may not be easily expanded beyond a certain point in its lifespan.
There are also limits to the improvements that can be made Software patching. Sequencing updates over time can lead to a complex backlog of infrastructure patches.
Older devices tend to suffer from performance degradation and are likely to experience more interruptions. At the same time, older devices will have difficulty meeting the needs of newer software and applications.
Then, when it comes time to upgrade the infrastructure, there will likely be significant disruption during installation, migration, and startup.
Purchasing storage devices completely involves transferring risk from the vendor to the customer. The customer may pay for maintenance going forward, but ultimately it is the customer’s business that suffers if outages occur and/or the infrastructure falls short of what is required.
What is capital expenditure versus operating expenditure?
Capital expenditures (capex) are money spent to purchase or upgrade non-depreciable physical assets. It is a one-time investment with ownership transferred to the buyer. Capital expenditures typically cannot be tax deductible, but fixed assets can be depreciated over time to spread out expenses over the life of the asset.
Operating expenses (opex) are money spent on day-to-day operating costs that can be one-time or recurring. In storage and IT, the obvious example is paying for cloud services. Operating expenses are included in the financial statements and can be deducted for the year in which they occur, and are included on the company’s balance sheet. Operating expenses are included in operating income calculations, which are then used to calculate net income, or the bottom line.
It is worth noting that some organizations – in the UK public sector, for example – have mostly paid for infrastructure costs through capital procurement, but this is starting to change.
Why does all this relate to purchasing storage? The rise of the cloud and the operating and purchasing models that have arisen from it have made OPEX a commonly used way to spend on storage and IT.
What is the cloud operating model and what are its benefits for purchasing storage capacity?
The cloud operating model arose with the prevailing purchasing consumption methods in the cloud. Instead of owning the infrastructure in the cloud, customers consume it.
The cloud operating model has a number of benefits to purchasing hardware, including storage. Chief among these factors is that the organization is not restricted by a three-year modernization cycle and can avoid all the downsides that come with it.
Storage devices can be paid for on an immediate usage basis. This means that the vendor makes sure that the equipment is updated and capacity is increased to meet current and future needs and address faults.
This also means no disruptive forklift upgrades every three years, and no need to suffer increasing levels of infrastructure inefficiency as it ages. The equipment can be continuously updated, with the latest equipment and required capacity always available.
This is often taken care of through remote monitoring as some vendors allow cloud purchasing to increase capacity and performance, while also monitoring technical issues in the infrastructure stack.
Costs can decrease or be matched more effectively to ongoing needs as organizations pay for storage on a pay-as-you-go basis. All of this can also mean fewer employees within the company for support and maintenance, while freeing up existing employees to focus on more strategic projects.
What are the downsides of purchasing capital storage and the cloud model?
While capital expenditure purchases entail transfer of risk to the procuring organization, depreciation (OPEX) purchases bring different concerns and risks.
This can include some loss of control. Where full ownership can bring a sense of control and security to an organization, handing over ongoing maintenance and upgrades to a third party may entail the opposite. This is potentially a double-edged sword, because handing over responsibility is exactly what a customer wants from a SaaS purchase. If all goes well, that’s a benefit.
But when things go wrong in the traditional model, everything remains in the hands of the customer. This may not be the case when the vendor monitors and controls on-premises infrastructure. In particular, there may be security and compliance needs that the cloud provider cannot adequately meet, which may mean that purchasing as a service is not a good fit for some organizations.
Some type of vendor relationship management is absolutely essential for any customer in a cloud operating model so that the provision and performance of services can be monitored and managed.
Finally, paying for storage infrastructure as a service arguably locks in suppliers.
What purchase consumption models do storage vendors offer?
Storage vendors offer consumer procurement processes that range from pure OPEX models as a service to wholly owned CAPEX, but with contracted hardware upgrades.
In service models, customers typically stick to basic levels of usage while offering upgrades to storage and controller devices as needed.
At the capex end, customers can purchase storage devices and still benefit from storage device upgrades, with predictive monitoring and analytics.
What do storage vendors offer?
Dell Apex Flex On Demand
Dell’s hardware consumption model is Apex Flex on Demand. This allows customers to choose from block, file and object storage devices, as well as data protection devices.
Dell and its customers are working to identify “committed capacity” and “spare capacity” that are likely to be needed in the future. Raw and usable capacity data are measured at the component level using automated tools installed with the devices.
Customers commit to a term of usage, after which they can move from month to month, extend the subscription, or return and upgrade devices. Customers can also view and approve pre-billing reports on metered infrastructure usage and costs via the APEX console.
Available storage via Flex includes PowerStore, PowerMax, PowerFlex, PowerScale, and ECS. PowerProtect DD and PowerProtect DP data protection appliances are also available, as are PowerEdge servers and HCI solutions.
HPE Greenlake
HPE GreenLake delivers pre-configured hardware and software and manages the system through its lifecycle with payment via a monthly subscription fee.
The storage units offered include block, file, and object, including HPE Primera high-end flash, HPE Nimble all-flash and hybrid flash, Simplivity hyperconverged, Qumulo hybrid cloud storage, and StoreOnce data protection appliances.
Storage comes from GreenLake consumption along with HPE’s entire data center supply. Therefore, GreenLake comes with the full suite of HPE offerings behind it, from composable infrastructure like HPE Synergy, third-party software and services, and professional and operational services from HPE Pointnext.
Hitachi Vantara
Hitachi Vantara’s Flex plans offer storage devices for purchase or lease, as well as consumption models. The last is EverFlex, a storage-as-a-service offering, which varies depending on whether the infrastructure is managed and monitored by the customer or Hitachi. Both are cloud-like, pay-per-use models.
IBM
IBM offers storage as a service and purchases storage consumption.
Storage as a Service can operate across and build on your on-premises data center and hybrid cloud IBM Flash System and DS8900F devices. Comes with a basic tier to meet current needs plus 50% above the pre-installed tier. Core and expansion capacity are charged at the same rate.
Storage Utility is a pay-per-use model that delivers 200% above baseline capacity on day one while avoiding data center disruptions through over-provisioning and using IBM Storage Insights to monitor capacity needs.
Customers only pay for what they use, and if their data needs shrink during any month, the bill will reflect capacity usage, with a minimum “base.” The purported benefit of overprovisioning means that additional capacity is readily available, at least for the duration of the contract.
NetApp Keystone
NetApp Keystone offers hardware in various non-capital formats including on-premises and cloud capacity.
Keystone’s payment options range from full hardware payment (Flex Pay), through pay-per-use for a Flex subscription, to Flex Utility, which aligns costs with usage.
A range of service levels are available and billing is done for expected allocated capacity, as well as pay-per-use for burst capacity and support for file, block, object and cloud storage services.
NetApp’s Active IQ dashboard allows customers to monitor and manage storage usage, provide storage and data protection policies, review usage and billing, and order capacity and services.
NetApp’s BlueXP provides a single control plane in which all NetApp volumes are visible, both on-premises and in public clouds.
Pure storage
Pure Storage’s offerings come as a service under the Evergreen brand. Evergreen/Forever offers customers the ability to purchase outright, but with lifetime upgrades.
Evergreen//Flex allows for hardware purchases but capacity is purchased on a pay-as-you-go basis. Capacity can be provisioned on any Pure device that can host it. So, in theory, Flex allows customers to use capacity in any of their arrays.
Evergreen // One unifies local and public cloud storage resources into a single subscription to provide block, file, and object storage. Customers only pay for what they use.
Pure1 management tools allow management across the data center and cloud from a single dashboard. This includes monitoring and provisioning, as well as the ability to manage capacity and performance upgrades from Pure.
