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Storage Chargeback Costs

I saw an email this morning from Luther Allin of Miller & Martin PLLC on dl-toasters.  This would be an incredible opportunity for the community to chime in.  Thanks.

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For those of you that are doing storage chargeback, approximately how much are you charging per MB or GB? I’m sure that it depends on the type of disk (FC or SATA) so if you don’t mind sharing numbers I’d appreciate it.

Luther



Luther Allin
IT Manager
Miller & Martin PLLC


Suite 1000 Volunteer Bldg.
832 Georgia Avenue
Chattanooga, TN 37402
Phone (423) 785-8381
Fax (423) 321-1678

Re: Storage Chargeback Costs

So let me chime in on my own post. I realize that there are a ton of factors that can influence these numbers and what I'm looking for is not a "hard/accurate" number at this time. I'm looking for just some averages of what some of my peers use as chargeback numbers. I will not actually be generating chargeback invoices per se, but what I want to do is show some of my more storage happy users what they are costing the firm by accumulating gigs and gigs of data and never allowing us to archive it or delete it. So that's the reason for the question. So approximate average numbers are fine. What I intend to do is probably average what I get from the community and use them for our numbers initially. So thank you for any input that you can provide.

-Luther

Re: Storage Chargeback Costs


Hello,

Here is the info on how I setup Chargeback for storage at NASA-JPL.

The original equation had a base charge of $50/GB.  This included clustered storage that was snapmirrored to a different building on JPL property.

I had worked the equation through trial and error to end up with

monthly charge = U * 50 / (log ( (U^2/1000) (U^4/200000000) + 10 ))

where U is the usage in GB.

If you plot that out, you can see a decreasing cost per gig overall.

That equation was a little confusing as the cost per gig was contained within the function.

The algorithm was reworked (down to $25/GB base) to break out the Cost per Gig, it became

   Cost per Gig =25*(1.3348-LOG((U+100)/10)/3)^2
  
where U is the total usage in GB.

Once you have the cost per gig, monthly charge is,

   Total monthly charge = U * Cost per Gig

Here is the real trick, you need to create a spreadsheet or some other method that will total your customers and all of their monthly charges to result in a Monthly Customer Total (MCT).  Multiply 12* MCT to get an estimate of the the Annual Customer Total (ACT).   Now you have to make sure you can afford all of the costs of supporting your storage infrastructure within that ACT number.  Be sure to combine the costs for your systems, replacement hardware, the power, A/C, network, backup and system administration costs to get the Annual Total Cost of Ownership (ATCO).  If ATCO is greater than ACT, then you either need to charge more, or figure out a way to reduce your ATCO.

It takes some trial and error, but after a few attempts at closing the gap between ATCO and ACT, you will get a better feel for that base ($25/GB ?) storage charge unit.

Customers will appreciate the Cost per Gig equation as it shows them economies of scale.

I hope that helps you balance your books.

Best,

Joe Bishop

Re: Storage Chargeback Costs

Just a couple of questions out of curiousity?


- What level of utilsiaiton are you charging back at - Volume ? Qtree ? Quota ?

- Is this by Raw, Allocated or Used ?

- How are you factoring in Storage efficiency technologies like RAID-DP, Dedupe and Thin prov ?

TIA
Rich

Re: Storage Chargeback Costs

Good thread!

We're in the process of developing storage costs at our org and we're asking a lot of the same questions. I'd love to hear feedback from more people on what they're doing.

One thing we're looking at doing is creating separate chargeback models for SAN storage and CIFS share storage. A lot of other things go into SAN volumes with LUNs (fibre channel ports, switches, etc), so it changes the chargeback cost. We'll probably report on volume space usage for SAN volumes and use qtree space usage reports for shares.

Re: Storage Chargeback Costs

Joe, how did you come up with this forumula ? I would like to get more information on it and how I can apply it to my environment.

I tired to use this forumla and plug in my numbers and got really high outputs. 

Cost per Gig =25*(1.3348-LOG((U+100)/10)/3)^2  is 1.3348 a constant or it changes, and what is it?

Also to clarify where U is the total usage in GB, U is total used gigs in an aggreage or total space in general unused?

So in my example I ran this math and i got these outputs

where U (total used gigs in my filer) = 19892
25*(1.3348 - Log((19892+100)/10)/3)^2 = 35.822

Total monthly charge = U * Cost per Gig

19892 * 35.822 = 775778

Please explain what else I should be trying to calculate or match with. Thanks, Anton

Re: Storage Chargeback Costs

Hi Everyone,

I'm new to the NetApp Community

I'm an Account Manager for a Netapp reseller in Australia and am seeing many of my customers go through this process at the moment, while also trying to sell our own new cloud service based off Vmware VCloud director, Cisco UCS and Netapp storage architecture.

I thought I would just share an article I found quite thought provoking is, "chargeback are you using it to induce the right behaviors or to move funny money around".

http://storageexpert.wordpress.com/2010/05/24/chargeback-are-you-using-it-to-induce-the-right-behaviors-or-to-move-funny-money-around/

It discusses performing a complete Total Cost of Ownership (TCO) analysis to determine all cost components, variable and fixed, that go into supporting that storage capacity.Then discusses how you should align the cost model with the Services Levels that the IT department are providing the business. Finally it discusses driving the users in chosing the right services level for their particular need and essentially driving effeciency within the Chargeback - IT as a Service model while be fair and equitable to users within the business.

Anyway..happy reading.

- Robbie Cameron

Re: Storage Chargeback Costs

Hi Robbie,

Thanks for sharing!  If you find any other articles, please post here.  I'm working on indroducing more cloud related content (from community members like yourself, NetApp teams and other 3rd party sources).  A while back we tired to introduce the cloud topic within the community and found the perspective to be -- i'ts all marketing and not much else.  Fast forward a couple of years, it's much more than a business model. 

It would be great to hear about some of your customer experiences - challenges, successes -- really anything that is interesting to you.

Thanks for the post and look forward to hearing more from you!

Terri

Thanks so much!
Terri Peluso
Senior Community Program Manager

Re: Storage Chargeback Costs

Hi,

Any news on this topic or success stories from the trenches. It is definitely a multifaceted approach invoking all tiers and aspects of the business. Did your business customers/clients/CIO/CFO accept the Charge Rates? Were there fluctuations or change in the Charge Rates that was pushed or pulled from different business units? I am more interested in Private Cloud Chargeback.

Thanks

Jeff