The Cost of Wasted Storage Capacity

Background

According to a large, very well-known and widely respected (but very difficult to quote in blog
posts) analyst organization, data center storage utilization has decreased sharply over the last
eight years; from a high of just under 70%, data storage utilization rates have now fallen to
under 60%. For those keeping score at home, that’s a heck of a drop in average storage
utilization. And more to the point, that represents a lot of storage that isn’t earning its keep.
Another well-known and widely respected analyst (IDC), has publicly stated that in Q4 of 2018,
enterprise storage vendors shipped 92.5 exabytes for approximately $14.5B. Some quick math
(mostly eliminating an enormous number of zeros), tells us a few things:

    • The Q4 2018 price of enterprise storage, averaged over all types of storage and all
      supplier/customer combinations, was a little under $0.16/GB
    • The result of the reported decreased utilization, just for storage sold in Q4 2018, is an
      additional exabyte of wasted storage
    • All of which boils down to an incremental a cool $160M in wasted spend. In Q4 2018
      alone

$160M per quarter here, $160M per quarter there, pretty soon someone’s going to want to
change something. And that not-aforementioned consulting firm is telling their clients to “Stop
Wasting Money,” pointing out that moving utilization back to the 70% range can be worth tens-
to-hundreds of thousands of dollars.

At Zadara, we couldn’t agree more.

In fact, the only issue we have with that recommendation is that it lacks ambition.

The Opportunity Missed

Analysts argue that enterprise IT organizations should aim for data storage utilization rates of
more than 70%, up to 80% “if possible.” The theory is that you should reserve at least 20% of
your capacity to handle demand spikes. And this makes sense in a traditional CapEx
acquisition model.

But we shouldn’t pretend that this is free. It’s not.

If users can save tens-to-hundreds of thousands of dollars by getting utilization rates up over
70%, imagine what can be achieved with utilization rates over 90%.

The Pointy Part

Fun fact: Zadara customers routinely run at 90% – 95% capacity utilization. They can do that
because Zadara enterprise storage is (only) delivered as-a-service. If they need more capacity, they just add it on demand. They can also reduce storage capacity when demands decrease.

So, why pay for what you’re not using?

Bottom line: If you really want to increase your storage utilization and reduce total storage
lifecycle costs, you’re going to have to do something different.

Like giving Zadara a call and asking us about the greatest storage that you can’t buy.

 

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