by Kelly Quinn, Research Director, RampRate
Sourcing Advisors / Strategic Research
LA: (310) 319.1599 | NYC: (212) 967.3356
http://ramprate.com

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“Commodity Servers, Premium Datacenters”

It’s a phrase I’ve heard used more and more over the last few months, and I think it nicely sums up the general trend in datacenter computing over the last several years. 

Chipset manufacturers aren’t striving to stay on the bleeding edge of Moore’s Law anymore. They realize the real-life implications of a fully loaded 40 Kw rack in the datacenter.  They’re keeping their product development eyes on solutions that are more in tune with what customers need – improved computing power, but not in a hot vacuum. 

Hardware manufacturers and participants across the datacenter construction chain are attuned to this, too, and have made attempts at various points to introduce the cure for feverish datacenters.  Data center vendors are making a splash with the first post-mainframe water cooling revival, with some even proposing more exotic solutions like CO2-based cooling.  Hot aisle/cool aisle rules of thumb are giving way to comprehensive airflow analysis using computational fluid dynamics software.   Small ISPs and Internet giants alike are touting the green data center approach, whether internal (solar panels and high-efficiency UPSs) or the ability to buy greener power from a hydro- or wind-powered utility. 

RampRate’s data put monthly costs per rack between $225 and $6,500 with outliers in excess of $25,000, depending on location and density.  Granted, reaching those upper bounds requires cramming a 42U cabinet full of multiprocessor blades, but in a world where you can get a dual core 1U server for under $800, the days where servers were the premium product and datacenter space was commodity are long gone.

So what does this mean for datacenter customers?  You have a clear need for aggressive efforts to secure the most advantageous datacenter pricing possible.  You know it’s not like it was five or six years ago, where you could walk in to any datacenter decimated by the dot com bust and name your price.  Now, you need to carefully identify potential providers, closely examine their pricing and any add-ons that might catch you after you sign on the dotted line.  You need someone who knows the market pricing and players inside and out and has the leveraging power to get you the best deal possible from this premium market.  (Of course, RampRate is perfectly positioned to do that, but to say so outright would make this a sales piece and not a blog post, so I’ll withhold my comment on that.)

What do you think?  Are datacenters going to remain premium products for the long term, or will a single global round of upgrades re-commoditize space?  Are OEMs doing enough with innovative designs in chipset power draws to reduce the need for absurd amounts of cooling for a single rack?  Will this idea of the ‘greening’ of the datacenter take off – and, if so, will that create a new subset of elite premium datacenters?

Commentary on the “Global Information Technology” report and rankings

by Alex Vestyl, Principal Analyst, RampRate

It seems that every couple of years, fear over the rise of global competition makes its way into the headlines, presenting welcome opportunities for evangelists to ascend their respective daises.   In April, the “Global Information Technology” report, which examines and ranks nations in terms of network readiness, was released. Following the report, headlines at the innovation and technology blog IP Democracy[1] and the news service Reuters, once again, sounded the alarm to the public around US international competitiveness with the headline, “U.S. Slips from Top Technology Spot.” 

The US’s ranking at number “7” – behind Denmark and Singapore – is deflating. But at each sign of a slip in competitiveness, especially when the World Economic Forum releases a report placing the US beneath less power economic players, is there cause to raise the alarm bells once again? Or are we too quick, as a society, to conclude that the fall of Rome is nigh with the words “U.S. Slips from Top Technology Spot?”

Diversions In Logic

It can be argued that the answer is a resounding “yes.”  The truth is that as a measure of innovation, network readiness is only a slice of the total innovation equation. The word “innovation” in its purest definition is, “The introduction of new ideas, goods, services, and practices which are intended to be useful.[2]”  The IP Democracy report measures “the degree of preparation a nation or community requires to participate in and benefit from information, communications and technology (ICT) developments” focusing on the “environment for ICT offered by a country or community,” “readiness of the community’s key stakeholders (individuals, business and governments)”, and “usage of ICT among these stakeholders.”   

While ICT is an important cog in the innovation engine, it is one cog of many. Along with a well-developed ICT infrastructure, innovation must be measured by private and public R&D spending, number of patents registered, public research money spent, etc. Furthermore, if the market accepts highly developed and less regulated ICT as a standard for innovative nations, this further begs the question: What is the benchmark for “readiness,” and which standard of “usage among ICT stakeholders” is this a measurement against?

 “What’s The Measurement?” 

This report appears very heavy on anecdotal analysis, rather than a true quantitative measurement of telecommunications infrastructure and the regulatory climate of national infrastructure.  The focus of the study is squarely on fixed connectivity. This ignores the fact that many more newly developing countries, such as eastern European nations, are rapidly adopting wireless broadband infrastructure like WiMax to leapfrog into the broadband age. In contrast, more “developed” infrastructures must grapple with the burden of legacy networking systems. Even then, the fact that there is a marked absence of some of the most wired societies in the world in the report, like South Korea and Japan, gives pause during even a passing analysis. 

A Better Way 

Instead of relying on ICT as the measure of technological innovation, a better measure of innovation would lie in taking a more holistic view of the overall business of technological innovation.  An example would be measuring what countries are registering the most new patents. The World Intellectual Property Organization has been recording this data. If one trusts WIPO’s numbers, the rankings look drastically different when including countries like Japan and South Korea in the mix:

Figure 1:  Number of PCT International Applications files in 2005 by Country of Residence

As Figure 1 illustrates, of the number of international patent applications in 2005, the US was far and away ranked the top individual country of residence for patents filed. In terms of countries where non-residents file patents, the US ranks the top in that category as well, leading all other countries with 81% — providing evidence that the US is the preferred location to develop and build on innovations. The US also boasted over 160,000 patents in 2005, followed distantly by Japan at 120,000. Total R&D spend is also another measure of innovative investments. There are a variety of standards to measure innovation, but connectivity and ICT as examined by the Global Information Technology report is simply too focused a measurement to be the end all.

[2] Merriam-Webster’s online

Why online gaming will be the biggest casualty if ISPs prioritize packets

Synopsis

The debate over net neutrality has often focused on video as the dominant medium that made the prioritization of packets either crucial or harmful. However, video is not the offering that will suffer the most if net neutrality becomes a wistful memory. Rather, the users that are likely to be most materially disadvantaged are those that utilize the Net for interactive communications – particularly voice over IP (VOIP) and online gaming. Of these two finalists for the dubious title of “innovation most likely to be stifled to the detriment of everyone by loss of net neutrality,” gaming is by far the more irreplaceable and senseless loss.

Unlike video and voice, ISPs are unlikely to have or be able to obtain a viable material stake in the gaming business and have no replacement for the service. As a result, consumers stand not only to lose their choice of the source of this product, but the very value of the gaming service itself.

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