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Total Cost of Ownership: the True Cost of IT

Posted by Blake Duffield 15-10-2015 9:00 am

News Millenium Micro - Total Cost of  Ownership: the True Cost of IT

The cost of I.T. is a very difficult concept to understand no matter the scale of your businesses infrastructure. This cost of any I.T. infrastructure is not limited to the initial purchase of equipment but extends into operational costs that can often be overlooked. Costs such as electricity, maintenance, and equipment age are all examples of what affects the overall cost of ownership for a business. 

The I.T. industry generally accepts that there is a 4-5 year lifecycle on I.T. equipment. The age of your I.T. equipment can vastly affect the operational costs of a business infrastructure and servers are a prime example of this. Services that might have required a dedicated server a short time ago may be consolidated into a single machine. Deciding to upgrade your hardware to consolidate these services into a single piece of hardware may be justified by only looking at the costs of electricity to run the older machines over time. Why continue to operate 3 or 4 servers that are using 400w of electricity when one will do?


Performance and reliability of your equipment are also something to keep in mind when looking at operational costs. Does your business host your own email service and website? Not taking into account the operational expenses of hosting these services in house, is 100% availability guaranteed? Simply migrating these services to a cloud provider (for example Microsoft Exchange Online for email) completely eliminates the hardware requirement for operation, can greatly reduce operation expenses, and provide a guarantee of 99.9% uptime at a predictable price. 


Maintenance is also a vital component of costs to examine. As equipment ages over time the cost of maintenance rises with it. The cost of parts and availability become another issue as industry standards change. Today a 4GB stick of DDR2 memory may very well cost the same or more as an 8GB stick of DDR3 and that is if you can find a supplier that can source these outdated parts. The same example can be made of processors, storage, network adapters, etc. There are times when simply replacing an aged piece of equipment may be more cost effective then trying to keep it running. 


The above is just a short overview for the cost of ownership of I.T. infrastructure. The truth is there are still many more variables that are not described in this article. At the end of the day though the determining factors to decide when to pull the plug on a piece of equipment or maintain your existing infrastructure, like most things in business, are time and money. By looking beyond the upfront cost of I.T. and looking at the cost of ownership, more educated decisions on how to maintain I.T. infrastructure can be made.       

Blake Duffield, Corporate Sales Manager, myITsource, Brandon, MB