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Document #249119. © 2014 IDC. www.idc.com |

IDC White Paper | The Value of Scaling Up to HP-UX and Business-Critical Servers

EXECUTIVE SUMMARY

An IDC analysis shows that HP customers upgrading their HP Integrity servers and the HP-UX

operating system (OS) are benefi ting from cost savings from creating more consolidated

datacenter environments and increased employee productivity as a result of better

application performance. On average, these customers are recording a fi ve-year return

on investment (ROI) of 325% by upgrading HP Integrity servers and HP-UX. IDC’s analysis

demonstrates that HP’s customers are benefi ting by:

» Improving the stability of critical business applications and programs

» Reducing outages and downtime for customer-facing workloads

» Consolidating their server footprints and cutting costs associated with servers and power

» Driving higher non-IT employee productivity by enabling time savings and more

productive use of business applications and programs

Situation Overview

Today, a company’s datacenter and day-to-day business operations are tightly integrated.

Companies are increasingly looking to their IT as a means to gain a competitive advantage

in the market rather than simply as a means of supporting business functions. IT applications

and services have become a critical element in how companies interact with their customers,

deliver new products and services, and improve the productivity of their own workforce.

The Value of Scaling Up to HP-UX and Business-Critical Servers

Sponsored by: HP and Intel

Authors:

Al Gillen

Randy Perry

Matthew Marden

June 2014

Business Value HighlightsUpgrading existing HP

Integrity servers and the

HP-UX operating system

delivers a 325% ROI and

pays for itself in nine months

through the following

benefi ts:

• Lowering server

footprint costs:

28%• Lowering power costs:

23%• Reducing impactful

unplanned downtime

per user from more than

one hour to four minutes

per year

• Increasing non-IT

employees’ productivity

through better application

performance and instilling

confi dence in IT

systems and services



The integrated nature

of the HP Integrity

platform delivers

effi ciencies in systems

management,

monitoring, and

provisioning.

Yet even though IT organizations are charged with delivering an expanding base of workloads

and seemingly higher degrees of service-level agreements (SLAs), they are also challenged

with constrained budgets and overburdened staff . In response, IT organizations must seek

effi ciencies in their operations and shift to a more agile infrastructure that is fl exible enough

to adapt to future changes in the business.

Over the past 15 years, IDC has seen the industry move more toward distributed

environments as lower-cost x86 systems increased their share of workloads. While this

shift enabled customers to control capital expenditure with lower-cost servers and made

it possible to inexpensively add incremental capacity, the increased operational costs of

managing the proliferating x86 installed base are taxing IT budgets, making it diffi cult to fund

and staff new initiatives. The reality is that lightly provisioned x86 servers have created sprawl

— sprawl that has been muted by x86 virtualization — and the industry still has signifi cantly

more capacity than workloads. Every server and every operating system instance needs to be

provisioned, life cycled, and operationally managed, backed up, and covered with a disaster

recovery plan.

This white paper examines how six organizations spanning the pharmaceutical, healthcare,

banking, and manufacturing industries were able to upgrade and expand their operations

using the HP Integrity server product line and the HP-UX operating system and, in the

process, reduced their datacenter operating costs, increased the reliability and availability of

critical applications and programs, and improved business productivity.

The integrated nature of the HP Integrity platform delivers effi ciencies in systems

management, monitoring, and provisioning. HP Integrity servers utilize HP Insight

Management software and HP’s Integrated Lifecycle Automation to automate key

management processes, including a system’s physical deployment, confi guration, and

problem management. Companies upgrading their HP Integrity servers were able to optimize

their IT staff resources and free up IT staff time for more innovative and valuable initiatives.

Up-to-date HP Integrity servers enabled these companies to consolidate physical servers and

components while still maintaining the same workload capacity and performance.

The study also demonstrated that renewing the HP Integrity environment improved IT

availability. Relative to traditional server environments, customers with HP-UX on HP Integrity

servers reduced downtime having a negative impact on end users from more than one hour

per end user per year to four minutes per end user per year.

IDC believes that HP Integrity customers can leverage upgrades to the latest generations

of HP Integrity servers (i4) with HP-UX to experience improved return on infrastructure

investment, creating a fl exible IT environment that provides for both easier IT management



Many enterprise

datacenters have

consolidated and

virtualized server

platforms in an eff ort to

eliminate redundancy,

reduce cost, and

increase IT fl exibility.

and easier adaptation to the changing needs of the business. IDC estimates that over a fi ve-

year period, the companies in the study saw their refresh of HP Integrity servers generate

$230,096 in benefi ts per 100 users within the HP Integrity and HP-UX environment and

recorded a return on investment of 325% for the upgrade. As a result, cumulative savings from

the implementation of this refreshed technology paid back the full investment within a period

of nine months after the completion of the installation and consolidation eff orts.

What’s Changing the Game?

IT Complexity Results in Business Ineffi ciency

Today’s enterprise datacenters are complex environments that typically handle a wide variety

of applications running on distinct types of platforms. In this heterogeneous datacenter

environment, there is an increasing requirement to drive effi ciencies by streamlining costs

and changing how staff spend their time — specifi cally working to shift the bulk of labor from

maintenance of existing infrastructure to work on new initiatives. Successful implementation

of this reallocation of IT labor investments can lead to tangible and positive business returns.

In the face of these requirements, IT managers are challenged by constrained budgets,

even though they still must continue to deliver on increasingly stringent SLAs, build new

applications, and maintain high levels of application availability. The issues of IT effi ciency

and agility are even more critical as more business units rely on tight integration with IT.

The datacenter has become a cornerstone of the business; workforce operations and client

relationships are increasingly driven by IT applications and services.

Many enterprise datacenters have consolidated and virtualized server platforms in an eff ort to

eliminate redundancy, reduce cost, and increase IT fl exibility. IDC sees this trend continuing,

with a shift toward using more network and storage virtualization, along with management

tools to create agile, software-defi ned compute environments via virtual resource pools.

With a consolidated, converged infrastructure, IT organizations can deliver the fl exibility and

scalability to turn IT into a more service-oriented corporate function.

Challenges with Distributed Industry-Standard

Server Environments

Enterprise datacenters continue to increase in scale and complexity every year. IDC research

shows that companies have predominantly transitioned their IT environments to distributed

industry-standard architectures. These scale-out deployments were driven by the ability to



expand IT services to a greater number of business users. The lower price point for industry-

standard systems over the traditional scale-up business systems enabled IT departments

to control their capital expenditures. However, this migration to a distributed environment

created a more complex infrastructure that resulted in higher operational costs, higher

unplanned downtime, and less effi cient use of compute resources.

The management and administration cost associated with server environments has grown to

eclipse costs in other categories. Many customers report that the personnel cost to maintain

their server installed base consumes the majority of their IT budgets. In addition, server power

and cooling remains a top-of-mind issue. IDC’s data indicates that the annual energy expense

associated with servers can reach up to 60% of the cost of the capital expense.

Customers have been relaying to IDC that their IT staff are overburdened with operating their

IT environments because of the complexity in the datacenter. As shown in Figure 1, IDC’s

research indicates that generally, as servers and virtual machines expand in the datacenter,

server administration costs increase and take much larger percentages of the IT datacenter

budget.

FIGURE 1

Workload Growth and Consequent Customer Spending on Servers, Server Administration, and Power and Cooling, 1997–2017

Notes:

We expect server capex spending as a percentage of total spending on server infrastructure will drop from over

65% in 1997 to just under 20% by 2017.

Workloads, as measured by the number of OS instances , will have increased 24 times between 1997 and 2017.

Source: IDC, 2014

$400

$350

$300

$250

$200

$150

$100

$50

$0

2.0

1.5

1.0

0.5

0

1997 2002 2007 2012 2017

Customer Spending ($B)

Workloads (M of OS Instances)

67% 44% 34% 24% 19%

Power and CoolingServer AdministrationServer SpendingWorkloads



Each passing year,

it appears that

the competitive

environment requires

businesses to both

deliver applications

faster and improve

productivity.

Future Requirements for a More Effi cient IT Environment

Complex IT environments and overburdened IT staff are driving higher costs in the datacenter

and negatively impacting the delivery of IT services. IT managers need to implement solutions

that can considerably reduce costs by:

» Increasing IT hardware utilization. The typical practice of overprovisioning server

capacity results in wasted rack space as well as increased power, cooling, bandwidth, and

operational costs. Consolidating server footprints via standard, consolidated platforms

can produce signifi cant capital and operating cost reductions. While x86 virtualization has

helped greatly, customers tell IDC that they still run their servers at suboptimal utilization

rates. Servers that can successfully support higher rates of virtualization without single-

point-of-failure concerns are attractive.

» Simplifying management and increasing fl exibility. As currently deployed, most

server confi gurations are static, hardwired, and diffi cult to change, even if the server

confi guration can be live migrated from physical server to physical server. Existing

management processes and tools align with individual technology silos, and the promise

of a software-defi ned datacenter has yet to really arrive in a practical, consumable sense.

The complex workfl ows and approval cycles between groups impact IT project delivery

time and solution cost.

» Improving server energy effi ciency. IDC fi nds that the primary drivers behind eff orts to

improve energy effi ciency are to ensure the availability of IT to the business by averting

risks posed by power and cooling challenges and, in parallel, to reduce operational

costs. To avoid costly new datacenter buildouts, IT must deploy more systems within the

constraints of the current power and cooling resources.

Each passing year, it appears that the competitive environment requires businesses to both

deliver applications faster and improve productivity. These requirements become challenging

because of the complexity of server environments and the fact that they are infl exible,

diffi cult to change, and costly to manage. The costs associated with provisioning, monitoring,

and managing servers have escalated, challenging IT organizations to seek systems and

tools to help them lower the overall cost of IT operations. For those with existing HP Integrity

environments, the most advanced HP Integrity servers directly address these problems, as

demonstrated in the research results presented in the sections that follow.



Latest-Generation HP Integrity Servers Drive Effi ciency and Simplicity in the IT Environment

Study Demographics

In March and April 2014, IDC interviewed six midsize and enterprise-level companies

from the pharmaceutical, healthcare, banking, and manufacturing industries that use HP

Integrity servers with the HP-UX operating system. IDC designed the interviews to collect

quantifi able information as well as qualitative responses regarding the organizations’ HP

Integrity environments and to understand the benefi ts these organizations are seeing when

upgrading their HP Integrity servers. With this information, IDC analyzed the impact on these

organizations of HP Integrity servers using the HP-UX operating system. Table 1 provides an

aggregated profi le of the organizations surveyed for this white paper.

TABLE 1

Sample Demographics

Average number of employees 2,800

Average number of HP Integrity and HP-UX users 1,750

Average number of HP Integrity servers deployed 5

Average number of CPUs on HP Integrity servers 70

Average terabytes of storage provisioned for 43HP Integrity servers

Average number of workloads on HP Integrity servers 18

Industries represented Pharmaceutical, healthcare, banking, and manufacturing

Regions represented United States, Middle East, Australia, and worldwide

Source: IDC, 2014



Financial Benefi ts Analysis

The organizations interviewed in this study expanded and/or upgraded their HP Integrity

servers to support specifi c workloads that are often business critical in nature. The most

signifi cant benefi ts these organizations experienced from these upgrades included:

» Ultrahigh stability for mission-critical or very important business systems and applications

» Higher availability (reduced downtime) impacting these systems and applications

» Datacenter cost effi ciencies realized by reducing or minimizing server sprawl

» Strong relationship with and support from HP

» Improved end-user productivity enabled by the power of HP Integrity servers by

improving application performance or reducing time required for certain processes and

programs

IDC’s interviews with the organizations sought to measure the fi nancial impacts resulting

from their upgrades of HP Integrity servers running on the HP-UX operating system.

IDC aggregated and normalized the results of these interviews and projects that these

organizations will realize a discounted average benefi t of $13.8 million, or $230,096 per 100

users of workloads and programs run on these HP Integrity servers using HP-UX, over fi ve

years.

The organizations are achieving these fi nancial benefi ts in the following four areas

(see Figure 2):

» Business productivity gains: HP customers’ end users are experiencing improved

application performance and reduced downtime, which saves time and improves

productivity. In addition, reduced downtime translates into higher revenue for a number

of these customers. On average, these organizations are realizing fi ve-year annual business

productivity benefi ts of $28,652 per 100 users, or $1.72 million per organization.

» IT infrastructure cost reduction: Customers upgrading their HP Integrity servers are

reducing costs by limiting datacenter sprawl, cutting power costs, and minimizing

database and application licensing costs with their HP Integrity server environments. On

average, these organizations are cutting IT infrastructure costs by $24,321 per 100 users

per year, or $1.46 million per organization, over fi ve years.



» IT staff productivity gains: Customers upgrading their HP Integrity servers are achieving

IT staff effi ciencies with their HP Integrity servers running on HP-UX both in terms of

administering these servers because of their reduced footprint and numbers and in terms

of productivity in application development and other areas because of greater application

performance. This results in a fi ve-year average annual benefi t of $7,915 per 100 users, or

$473,771 per organization.

» Risk mitigation benefi ts: HP customers are leveraging their updated HP Integrity and

HP-UX server environments to further reduce the occurrence, duration, and impact of

downtime on their operations. As a result, they are benefi ting from increased employee

productivity, with a fi ve-year average annual benefi t worth $3,386 per 100 users, or

$202,697 per organization.

FIGURE 2

Average Annual Benefi ts Resulting from HP Integrity Server Upgrades

Source: IDC, 2014

Driving the Business with the IT Environment

HP customers report that they are leveraging the stability and strong performance of their

updated HP Integrity and HP-UX server environments to realize user productivity gains and

capture additional revenue. On average, the organizations surveyed are realizing $28,652 per

100 users in annual business productivity benefi ts over fi ve years.

Total: $64,274 per 100 users

Business productivity gains

IT infrastructure cost reduction

IT staff productivity gains

Risk mitigation benefi ts

$28,652$24,321

$7,915 $3,386



An HP Integrity customer

that recently upgraded

from Superdome servers

to new Superdome 2

servers noted that it

can now complete a

batch process impacting

hundreds of business

users signifi cantly

faster. As the customer

explained, “Everyone

has experienced a

performance increase

as a result. One of the

fi nance guys asked, ‘Did

you guys do something?’

They noticed.”

Like businesses everywhere, HP’s customers are increasingly dependent on critical

applications and workloads to drive their business. The organizations surveyed for this

white paper reported that they are most frequently running workloads that support their

business decision making and core business applications on their HP Integrity server

environments.

Several customers noted that their end users have noticed the impact of running these

critical workloads on the updated HP Integrity environment. Much reduced downtime

on HP Integrity and HP-UX servers means that non-IT employees are spending less time

dealing with IT problems and have greater confi dence in IT supporting their eff orts to

drive business. According to one customer, “We use HP Integrity servers for our most

critical system, and they keep my business running.”

In addition, the signifi cantly enhanced computing power of the latest HP Integrity server

environment has spurred end-user productivity gains by improving the performance of

the applications used to drive business. As a result, employees are able to spend more of

their time driving their organization’s business and benefi ting their organization’s

bottom line.

Reducing the Cost of Infrastructure Across the

IT Environment

HP customers are leveraging their use of HP Integrity servers and the HP-UX operating

system to reduce their datacenter-related costs. With the latest, more capable HP Integrity

servers, they can maintain more consolidated server environments. Thus, even if they

could procure alternative servers at a lower cost on a per-server basis, their overall

server-related datacenter costs, including server footprint, power, and licensing costs, are

still lower by going with an updated HP Integrity and HP-UX environment. In total, IDC

calculates that these organizations are realizing average annual cost savings of $24,321 per

100 users over fi ve years (see Figure 3).



An HP Integrity

customer that recently

upgraded to HP

Integrity i4 servers has

seen costs related to

the size of its server

environment fall

dramatically since

the upgrade. As the

customer explained,

“We went from a 32

CPU unit in the RX

chassis to 2 CPUs with

4 cores each with

Integrity. One waist-

high machine to one

blade. Since upgrading,

we’ve reduced power

consumption by 90%

on these servers.”

FIGURE 3

Average Annual IT Infrastructure Cost Reduction Resulting from HP Integrity Server Upgrades

Source: IDC, 2014

One HP customer explained that it saw signifi cant value in its updated HP Integrity and HP-UX

environment: “We’ve reduced our power consumption signifi cantly and [we] get four times

more compute capacity.” On average, surveyed companies have 23.1% lower power costs

and 27.6% lower costs associated with their server footprints by maintaining a more

consolidated high-end server environment with HP Integrity and the HP-UX operating

system (see Figure 4).

FIGURE 4

IT Savings with Upgraded HP Integrity Servers

Source: IDC, 2014

Power costs

Server footprint costs

Licensing costs

Server administration staff costs

23.1%27.6%

31.0%

46.3%

$25,000

$20,000

$15,000

$10,000

$5,000

$0

Other costs reducedPower costs reducedLicensing costs reducedServer footprint costs reduced

$11,729

$8,359

$4,000

$233

Total: $24,321($ per 100 users)



A long-time HP

Integrity customer

explained why it prefers

the HP Integrity and

HP-UX environment

to a more distributed

environment: “If you go

with a more distributed

platform, the mapping

would be one to four

instead of one to one.

So to replace each

HP Integrity box, I

would need to put

multiple systems in,

which increases the

magnitude of support,

and our management

costs would be four

times as much.”

Making IT Staff More Productive

Organizations upgrading and expanding their HP Integrity server environments reported

achieving several types of IT staff effi ciencies. IT staff time savings and productivity increases

attributable to upgrading organizations’ HP Integrity and HP-UX environments totaled an

average of $7,915 per 100 users per year over fi ve years (see Figure 5).

As a baseline matter, HP Integrity server environments require less IT staff time to manage on

an ongoing basis. For IT departments, managing fewer, more reliable servers requires less time

and fewer staff resources. On average, the organizations surveyed also reported that their HP

Integrity server environments were 46% more effi cient to manage than an alternative server

environment.

Beyond time savings on ongoing server management, organizations also reported that the

upgrades are achieving other IT staff productivity gains, including:

» Improved application performance achieved with reliable and robust HP Integrity servers

running on HP-UX makes application development teams more productive.

» Greater server stability with HP Integrity means that surveyed organizations saved time in

areas such as incident and problem management.

» The ease of deploying newer HP Integrity servers means that surveyed organizations were

able to achieve time savings during initial deployments.

FIGURE 5

Average Annual IT Staff Productivity and Cost-Savings Benefi ts Resulting from HP Integrity Server Upgrades

Source: IDC, 2014

Initial deploymentOngoing server administrationOther IT staff FTE savingsApplication development time savings

$8,000

$7,000

$6,000

$5,000

$4,000

$3,000

$2,000

$1,000

$0

$5,243

$2,096

$527

$49

Total: $7,915($ per 100 users)



An HP Integrity

customer explained

why it is vital for it to

continue to reduce

downtime: “The real

issues when there is

downtime begin at

the end of an hour

of downtime. For an

hour, most of our lines

will still run because

we’ve downloaded

enough information

to keep going. At the

end of an hour, though,

we have no more

information to continue

to manufacture.”

Minimizing Unplanned Downtime, Benefi ting from

Planned Downtime

Customers using HP Integrity servers and the HP-UX operating system praised their impact

on the stability and availability of the workloads run on these servers. Surveyed organizations

already had low downtime environments, but they have even less downtime on their

updated HP Integrity and HP-UX servers (see Table 2). For HP Integrity customers, stability and

reliability are at the core of the value proposition of HP Integrity servers and the HP-UX OS. As

one customer explained, “Absolutely, HP-UX helps us better achieve our business strategy. This

is clearly translated in the number of downtime instances. There is absolutely zero downtime

with HP servers.”

Several customers explained that they avoid downtime with HP Integrity servers because of

the clustered HP Serviceguard server environment. With HP Serviceguard, the organizations

are able to partition servers and keep problems in one area of a server from becoming a

bigger problem that can knock a server offl ine.

TABLE 2

Downtime KPIs Updated Advantage with

HP Integrity Updated HP

and HP-UX Integrity and HP-UX

Average Pre-Upgrade Environment Change Environment (%)

Unplanned downtime

Number of unplanned 4.2 0.6 3.6 86

downtime incidents per year

Unplanned downtime hours 2.8 1.2 1.6 57

per incident

Annual unplanned downtime 1.2 0.1 1.1 98

hours of impact per user

Planned downtime

Number of planned downtime 2.2 2 0.2 8

incidents per year

Planned downtime hours 3.4 0 3.4 100

per incident

Annual planned downtime 0.1 0 0.1 100

hours of impact per user

Source: IDC, 2014



Organizations also praised the impact of their HP Integrity and HP-UX environments with

regard to their ability to take planned downtime. One customer explained the benefi t of

being able to take planned downtime as follows: “Because of the stability of the HP Integrity

environment, we can have more planned downtime. That’s a good thing because, with

more planned downtime, we can get needed changes done and we can be more proactive

in identifying and resolving problems.” In addition to this productivity increase, these

organizations are also realizing less quantifi able benefi ts by making their servers and systems

more robust by being able to take more planned downtime.

In addition to reduced downtime benefi ts, the surveyed organizations reported that they

maintain exceptional data integrity within their HP Integrity and HP-UX environments. As

one customer explained, “I’ve never had a data integrity issue on the HP Integrity platform

because of the internal redundancy. I don’t know how to correlate that to a world without

the redundancy built into it, but anytime you have hardware failures that are automatically

shutting things off , you have some risk to your data integrity.” Given that HP’s customers are

running business-critical workloads on their HP Integrity and HP-UX servers, avoiding even

the possibility of data integrity problems is a signifi cant benefi t.

Increased Consolidation Delivers Improved ROI

IDC assessed the cost, benefi ts, and value of upgrading HP Integrity servers running on the

HP-UX operating system over a fi ve-year period to the interviewed organizations. These

companies are making an average initial investment of $30,928 per 100 users and spending

an average of $6,543 per 100 users each year over fi ve years to upgrade the HP Integrity and

HP-UX servers. These investments will result in average annual benefi ts of $64,978 per 100

users over fi ve years. Over fi ve years, these companies will realize a cumulative net benefi t of

$261,246 per 100 users (see Figure 6).



FIGURE 6

Investments in and Benefi ts Resulting from HP Integrity Server Upgrades

Source: IDC, 2014

Table 3 presents IDC’s ROI analysis for the refresh of the organizations’ HP Integrity and HP-UX

servers. This ROI analysis is a fi ve-year view of the fi nancial impact on these companies.

The fi ve-year ROI analysis shows that on average, the organizations in this white paper will

spend $54,079 per 100 users of workloads or applications run on HP Integrity servers or the

HP-UX OS environment ($3.24 million per organization) and achieve $230,096 in benefi ts

per 100 users ($13.77 million per organization). This results in a net present value (NPV) of

$176,017 per 100 users ($10.53 million per organization) for their use of HP Integrity and HP-

UX servers. Based on these results, the organizations saw an average payback period of nine

months after deploying HP Integrity and HP-UX servers and are seeing an ROI of 325%.

InvestmentsBenefi tsCumulative net benefi t

$300,000

$250,000

$200,000

$150,000

$100,000

$50,000

$0

-$50,000

$261,246

$68,912 $69,832 $70,768

$47,371

-$30,928

-$4,738 -$6,809 -$6,931 -$7,056 -$7,183

Initial Year 1 Year 2 Year 3 Year 4 Year 5

$68,008

($ per 100 users)



TABLE 3

Five-Year ROI Analysis of HP Integrity Server Upgrades

Average per Organization Average per 100 Users

Benefi t (discounted) $13.77 million $230,096

Investment (discounted) $3.24 million $54,079

Net present value (NPV) $10.53 million $176,017

Return on investment (ROI) 325% 325%

Payback period 9 months 9 months

Discount rate 12% 12%

Source: IDC, 2014

How HP Customers Achieved These Returns

HP Integrity Servers and HP-UX Solutions

The HP Integrity platform and the HP-UX operating environment have a long history of

scale-up, business-critical computing. The platform itself is available in blade and rack

confi gurations of varying sizes to meet customers’ needs, from a single small server with just

one processor to an HP Integrity Superdome 2 confi guration with up to 32 processors.

To build a reputation in business-critical deployments, a platform needs to establish credibility

in a number of areas including long supported life cycles, have maximum scalability that

exceeds most customer requirements, have the ability to deliver high levels of uptime, and

deliver a minimum of unscheduled downtime. A solid portfolio of applications is required, and

that must in turn be backed up by deployment software including middleware and database

software. The solution must be manageable by common systems management tools that

customers often have in their existing environments. In short, customers expect the system

to be a tier 1 solution supported by both the compute solution vendor and the third-party

ecosystem that surrounds that solution.

HP’s goals for HP Integrity include the following:

» Always-on availability. Although HP Integrity servers may not be guaranteed to deliver

true uninterrupted computing, they off er inherently higher levels of availability than

competitive x86 servers. Further, HP has reduced the duration of any planned downtime

with HP-UX 11i v3’s dramatically faster reboots.



IBM has been growing

its market share in the

contracting Unix server

market in recent years,

attaining the number

1 ranking in terms of

unit volume and server

revenue.

» Cloud-ready Unix. The Unix operating system historically was the backbone of the

Internet and has been the inspiration of much of today’s compute infrastructure. The Linux

operating system was designed from the beginning to function as a Unix clone. Today,

commercial Unix products such as HP-UX continue to be relevant and benefi t directly

from the investments made by vendors into the Linux ecosystem since Unix and Linux

remain so closely aligned. HP off ers a private cloud solution for HP-UX, the CloudSystem

Matrix with HP-UX.

» Integrated software stack. Like most large system solutions, the HP Integrity platform

has a robust set of out-of-the-box software solutions that begin with HP-UX 11i v3. The

HP-UX solution includes both hard and soft partitioning capabilities and management

tools.

IDC notes that customers tend to select HP Integrity server and HP-UX 11i for the

most scalable, critical workloads that they are supporting. For instance, one large-scale

pharmaceutical company uses an HP Integrity server for its enterprisewide ERP system.

Challenges/Opportunities

HP competes with other providers of scalable server systems for customer opportunities that

fi t this high-end market segment. Not surprisingly, the competition for servers in this class

tends to be IBM and Oracle, both of which provide scalable Unix server systems that compete

directly for opportunities in this market segment.

IBM has been growing its market share in the contracting Unix server market in recent years,

attaining the number 1 ranking in terms of unit volume and server revenue. Competitors in

the Unix server market segment show no signs of slowing down, with all three major vendors

making major announcements in the fi rst half of 2014. IDC expects this market segment will

see a continuation of aggressive competition between the major vendors.

The decision to deploy new enterprise servers is often characterized by a sales cycle that is

longer than that of volume servers that are added to racks and blade server chassis because

investments in large systems are always associated with a very specifi c workload that has

broad application for a customer. Therefore, should the original plan be changed, the system

is usually not able to be repurposed to another workload like an x86 server could be.

One challenge HP faces is that it needs to make clear to the marketplace that HP Integrity

servers are available as “building blocks” for the datacenter and that the price range for the HP

Integrity server product line — which is best known for its midrange and high-end models

— extends into the volume space for servers priced at less than $20,000. Opportunities for



The fl exible computing

demands seen in

cloud computing

can be addressed by

HP Integrity servers

as cloud computing

moves increasingly to

provide enterprise-level

business services.

HP Integrity servers are broad, including longtime uses to support transaction processing,

scalable databases, enterprise applications, email, and Web-enabled applications, including

Java and many Linux applications. The ability of Unix to support modern runtime frameworks

(Java, PHP, Perl, Python, Node.js, Spring, and similar solutions) means that the HP-UX 11i v3 is

able to be used as the foundation for a platform-as-a-service (PaaS) deployment. In addition,

it is practical for ISVs that are currently deploying on HP-UX to use the HP Integrity platform

as the basis for a software-as-a-service (SaaS) off ering, thanks to the strong virtualization

capabilities of the HP Integrity solution.

Regarding vertical market segments, Unix has long been a favorite in important sectors

including fi nancial services, telecommunications, and government. It is perhaps less

known that HP Integrity servers also support Unix deployments in the healthcare, retail,

logistics/distribution, and manufacturing segments. HP Integrity servers support customers’

traditional Unix systems deployments. In addition, customers in Asia/Pacifi c, Central Europe,

Latin America, and Africa are using scalable HP Integrity servers to build new enterprise

infrastructure to support rapidly increasing computing demands.

The fl exible computing demands seen in cloud computing can be addressed by HP Integrity

servers as cloud computing moves increasingly to provide enterprise-level business services.

To that end, HP can potentially sell HP Integrity servers to cloud service providers for public

clouds delivering PaaS or SaaS or to IT customers for private clouds for infrastructure as a

service (IaaS), PaaS, or SaaS.

Conclusion

Today’s business organizations need more computing power than ever before but are

keeping expenses under close management to make sure they do not spiral out of control.

One technique to control operational costs over time is to consolidate workloads onto fewer

physical server “footprints.” It has proved to be a very useful IT approach during the economic

downturn, leveraging shared-resource virtualization and fl exible IT management.

When HP Integrity servers are deployed, expanded, and upgraded, they can be platforms for

workload consolidation from Unix servers. This is true for consolidating workloads not only

from Unix servers but also from x86 servers, particularly from x86 servers that are running

Linux distributions. Often, these Linux applications running on x86 servers are also already

available (or easily ported) to run on HP Integrity servers.

IDC’s study of this group of companies around the world that upgraded and expanded their

HP Integrity servers shows that dramatic savings are possible. Consolidating on refreshed HP



Integrity servers not only reduced the costs associated with supporting existing workloads

but also led to better business responsiveness, productivity gains for end users, maintenance

cost reductions, IT staff and management cost reductions, and fewer power/cooling and

footprint demands.

The scalability of the new generation of HP Integrity servers allowed these enterprises

to avoid the costs of buying and deploying more servers as their application workloads

inexorably increased — demonstrating the business value of consolidating onto scalable

server platforms.

Appendix

IDC utilized its standard ROI methodology for this project. This methodology is based on

gathering data from current users of the technology as the foundation for the model. Based

on these interviews, IDC performs a three-step process to calculate the ROI and payback

period:

» Measure the savings from reduced IT costs (staff , hardware, software, maintenance, and

IT support), increased user productivity, and improved revenue over the term of the

deployment.

» Ascertain the investment made in deploying the solution and the associated training and

support costs.

» Project the costs and savings over a fi ve-year period and calculate the ROI and payback for

the deployed solution.

IDC bases the payback period and ROI calculations on a number of assumptions, which are

summarized as follows:

» Time values are multiplied by burdened salary (salary + 28% for benefi ts and overhead) to

quantify effi ciency and manager productivity savings.

» Downtime values are a product of the number of hours of downtime multiplied by the

number of users aff ected.

» The impact of unplanned downtime is quantifi ed in terms of impaired end-user

productivity and lost revenue.

» Lost productivity is a product of downtime multiplied by burdened salary.

» Lost revenue is a product of downtime multiplied by the average revenue generated per

hour.



» The net present value of the fi ve-year savings is calculated by subtracting the amount that

would have been realized by investing the original sum in an instrument yielding a 12%

return to allow for the missed opportunity cost. This accounts for both the assumed cost

of money and the assumed rate of return.

Because every hour of downtime does not equate to a lost hour of productivity or revenue

generation, IDC attributes only a fraction of the result to savings. As part of our assessment,

we asked each company what fraction of downtime hours to use in calculating productivity

savings and the reduction in lost revenue. IDC then taxes the revenue at that rate.

Further, because IT solutions require a deployment period, the full benefi ts of the solution

are not available during deployment. To capture this reality, IDC prorates the benefi ts on a

monthly basis and then subtracts the deployment time from the fi rst-year savings.

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence,

advisory services, and events for the information technology, telecommunications and

consumer technology markets. IDC helps IT professionals, business executives, and the

investment community make fact-based decisions on technology purchases and business

strategy. More than 1,100 IDC analysts provide global, regional, and local expertise on

technology and industry opportunities and trends in over 110 countries worldwide. For

50 years, IDC has provided strategic insights to help our clients achieve their key business

objectives. IDC is a subsidiary of IDG, the world’s leading technology media, research, and

events company.

IDC Global Headquarters

5 Speen StreetFramingham, MA 01701 USA508.872.8200Twitter: @IDCidc-insights-community.comwww.idc.com

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