Server and Data Center Consolidation Microsoft IT enhances cost savings, availability, and performance Published: June 2004

Solution Overview Situation ● Microsoft IT needed to reduce enterprise complexity and costs Solution ● Improve IT operational efficiency, while reducing TCO ● Develop site taxonomy and Minimum Performance Level system ● Implement ICOs ● Consolidate servers and data centers ● Centralize server management ● Institute new operations practices and procedures Benefits ● Data center, server consolidation: 37% reduction in spending ● Site reduction: 54 percent ● Infrastructure server reduction: 27% ● Data centers: rent and maintenance reduced by 50%

Products and Technology ● Windows Server 2003 ● Exchange Server 2003 ● Office System

Excessive Complexity and Costs ● Too many data centers and servers ● Central management function not optimized ● Duplication of storage, applications, and hardware ● Inconsistent levels of support ● High rent and maintenance costs

Business Value ● Total $23.2 million in savings to date ● 40% reduction ● Server and Data Center consolidation ● $18.3 million reduction ● Internet Connected Offices ● $4.5 million savings ● Enhanced time to market

Business Value ● Infrastructure Server Consolidation ● Savings of $4.3 million ● Centralized Server and Data Management ● Incident Management team of 22 supports 10,000 servers worldwide ● New Operations Practices and Procedures

Catalysts and Background ● Key Catalysts: ● Hardware improvements ● Decreased communication costs ● Backbone bandwidth ● New connectivity options ● Product improvements ● Exchange infrastructure consolidation

Catalysts and Background Sever Consolidation Glossary ● Logical: server management, centralized management of business critical systems and applications ● Geographic: closing of data centers, and implementing ICO offices ● Homogenous: scalability of Microsoft products ● Heterogeneous: different applications from multiple servers onto one server

Server and Data Center Consolidation Strategy ● Systematically develop a layered tier system, or taxonomy, of IT service sites ● Define service levels that are provided at those sites ● Ensure consistency with the business requirements of the services that the sites support ● Begin ICO, consolidation activities

Server and Data Center Consolidation Strategy SiteNumber of People Primary Site Purpose NetworkServers Data Center 1 or 2N/AIT InfrastructureRequires at least redundant circuits Servers on-site High Availability Office N/APSS Call Center, Network Hub, or other valid business need Requires diverse access (2 paths) Consolidate servers to the Data Center where you can meet MPL Standard Office50 and greaterN/APoor ISP and/or requires more bandwidth than DSL Consolidate servers to the Data Center where you can meet MPL ICO-2 (Persistent Connection) Sales & MarketingGood ISP, requires more bandwidth than DSL Consolidate servers to the Data Center where you can meet MPL ICO-2RP (Persistent Connection, Regional Provider) Sales & MarketingGood ISPConsolidate servers to the Data Center where you can meet MPL ICO-1 (Smart Card)1-20Sales & MarketingGood ISPNone

Server and Data Center Consolidation Strategy Site Type: ICO-1 (Smart Card, Small, Unmonitored)

Server and Data Center Consolidation Strategy Site Type: ICO-2RP (Regional Provider, Persistent Connection, Small/Medium, Monitored) GTS Cable Room Routers and Switches (Possibly) PBX (Possibly) File/Print (Possibly) Active Directory®

Server and Data Center Consolidation Strategy GTS Cable Room Site Type: ICO-2 (Persistent Connection, Small/Medium, Monitored) Routers and Switches (Possibly) PBX (Possibly) File/Print (Possibly) Active Directory®

Server and Data Center Consolidation Strategy Site Type: Standard to high availability building (Large) GTS Cable Room Routers and Switches (Possibly) PBX File/Print(Possibly) Active Directory®

Server and Data Center Consolidation Strategy Site Implementation Internet Connected Office – 1 Redmond Data Center Internet Connected Office – 2RP Internet Connected Office – 2 Standard to High Availability Building ExchangeActive Directory File and Backup DSL/Cable or Local ISP/Equant Local Carrier/Regional Provider (Persistent VPN) Leased Line to Local ISP (Persistent VPN) AT&T/GX Leased Line AT&T/GX Equant Leased Line AT&T/GX Leased Line

Server and Data Center Consolidation Strategy ● MPL development – differs from SLA ● MPLs are relative measures of performance when a service is available ● MPLs are generally expected to be met 100 percent of the time ● SLAs are strictly measures of service availability ● SLAs are generally expected to be met 80 percent of the time

Server and Data Center Consolidation Strategy ● Internet Connected Offices ● Eliminate private network connection, remove office servers ● Significant savings – take advantage of less expensive network bandwidth ● Provides computing experience equivalent to local server environment ● Three levels of ICOs

Server and Data Center Consolidation Strategy ● ICO-1 (Smart Card) ● ISP provides ICO site’s Internet connectivity ● Client systems access corpnet through VPN (PPTP) ● ICO-1 is not managed centrally ● Intended for offices of 20 employees or less

Server and Data Center Consolidation Strategy ● ICO-2RP (Persistent Connection, Regional Provider) ● Carrier is an in-country or in-region provider ● Carrier is not managed by Microsoft IT Carrier Strategies team ● In many cases the carrier is designated by the local government ● Level of support is not guaranteed

Server and Data Center Consolidation Strategy ● ICO-2 (Persistent Connection) ● Requires a persistent, tunneled connection to the Internet ● Smart card not required to log on ● More costly than ICO-1 due to specialized equipment ● Centrally managed ● Targeted for sales and marketing offices with 20 to 50 employees ● ICO Implementations fast and straightforward

Server and Data Center Consolidation Strategy ● Regional data centers reduced from 24 to 11 ● Large data centers responsible for full range of services including backup and disaster recovery ● Smaller data centers responsible for services associated with latency ● Cost avoidance issues ● Iterative approach to consolidation

Infrastructure Server Consolidation Strategy ● Wide variety of infrastructure server types ● Consolidating domains with Windows Server 2003 ● Higher workloads on fewer servers ● Greater directory control and flexibility ● Consolidation allowed infrastructure servers to be repurposed

Infrastructure Server Consolidation Strategy Before ConsolidationAfter Consolidation ● 203 domain controllers ● 48 domain controllers in corporate headquarters ● 138 domain controllers ● 36 domain controllers in corporate headquarters ● Domain Controller Consolidation

Infrastructure Server Consolidation Strategy ● WINS, DHCP, DNS, ISA, Proxy Servers ● WINS and DNS required assigning new static IP addresses ● User communication paramount ● DCHP service consolidated onto regional domain controllers ● Use of secondary networks eases transition ● ISA and Proxy servers were removed at beginning of ICO implementation ● User impact high priority consideration

Centralized Server Management Strategy ● 22 people manage incident support for approximately 10,000 servers ● Remote support team was in-sourced ● 25% service SLA improvement ● Standard service offerings provided for all production servers

New Operations and Procedures Strategy ● Incident management practices enhanced monitoring ● Problem management practices resolved recurring service issues ● Configuration management practices defined standards by which devices are tracked, configured, and accepted ● Change management process revised the way changes are reviewed and implemented

Future ● Next target is application servers ● BUIT application support ● Represents 75% of all the systems in Microsoft IT ● Program will focus on: ● 64-bit computing ● Virtual Server ● Dynamic Systems Initiative ● Windows System Resource Manager

Conclusion ● Server and data center consolidations very successful at Microsoft ● Reduction of 40% ($23.2 million) in costs ● Opportunity to align IT infrastructure with business strategy ● Meeting future demands as well as immediate needs

For More Information ● Additional content on Microsoft IT deployments and best practices can be found on ● Microsoft TechNet ● Microsoft Case Study Resources ● Increase IT Efficiency: Maintain Fewer Servers serverconsolidation ● IT Showcase

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