Patrick Townsend & Associates

Alliance FTP Manager and PGP Option

Analyzing Total Cost of Ownership – A comparison with Intel Architecture Servers

The purpose of this document is to compare the total cost of ownership (TCO) of the Alliance PGP Option compared an Intel server based solution using the Network Associates eBusiness Server product. As a recent IDC report (“Server Cost of Ownership in ERM Customer Sites”, September, 2001) has indicated, there can be significant TCO advantages for deploying AS/400 and iSeries solutions in Enterprise Resource Management environments. Since most AS/400 customers use the AS/400 for ERM solutions this document attempts to follow the IDC format for analyzing TCO. As the following analysis indicates, there are significant cost savings when deploying an AS/400 solution for PGP encryption.

Methodology

In the following analysis we assume a fairly typical AS/400 customer implementation with one production AS/400 (processor group P20) and one AS/400 test and Disaster Recovery AS/400 (also processor group P20). The production database is mirrored to the DR system which is also used for testing and development. Since Alliance software requires a small footprint we have indicated only a modest cost increase for memory and disk. Experience indicates that AS/400 customers do not upgrade their systems when installing Alliance solutions.

For comparison purposes we assume an Intel Standard Architecture System (SIAS) deployed on a Dell PowerEdge 1550 rack-mounted server running the Microsoft Windows 2000 Server operating system. Most Enterprise customers deploy mission critical applications on independent servers for reliability and performance reasons. In this example we assume one production server and one combined test and DR server. For hardware cost purposes we include only the direct costs of the server platforms and exclude any costs associated with rack systems, additional switches or hub costs.

One well known advantage of the AS/400 platform is the integrated set of utilities for system monitoring, storage management, and backup and recovery. Since Alliance software utilizes these services we have not included any additional costs for such utilities. For the Microsoft Intel solution we have included software solutions for backup, system monitoring and FTP communications. While this software contributes a relatively small amount to the overall software costs we have included it because most Enterprise customers use and deploy such software.

IT support staff costs vary widely from one customer environment to another. For this reason we have separated IT support costs in the Summary of Results. The IDC analysis estimates 3.5 iSeries servers per IT staff. The same study estimates 1.3 Intel servers per IT staff. While this estimate probably reflects the IT staffing requirements for complex ERM applications, we believe a more accurate ratio of 10 Intel servers per IT staff is appropriate for the type of solutions we are comparing. For this comparison we estimate additional support for AS/400 and Alliance products at 5 percent of a full time IT staff position. For the two Intel architecture servers, PGP software, and system utilities we estimate additional support of 20 percent of a full time IT staff position.

While the IDC study mentioned above attempts to incorporate productivity metrics into the estimate of Total Cost of Ownership, we have made no attempt to do so in this comparison. We believe the high level of reliability, better up-time, and direct integration with AS/400 business applications provides demonstrable cost savings. But no attempt has been made to include these advantages in this comparison.

When using this paper to evaluate your own anticipated Total Cost of Ownership you may wish to modify the values below. In each section below we try to provide the basis of the cost estimates so that you can refine the estimate for your own purposes. We will glad to assist you in creating your own TCO estimates. [top]

Summary of results

Our comparison shows a significant advantage for an AS/400 solution for PGP encryption and FTP automation. When only direct costs of software and hardware are included the Alliance solution on the AS/400 enjoys a Total Cost of Ownership that is 54 percent less than the Intel architecture solution. When IT support costs are included the Alliance solution on the AS/400 enjoys a Total Cost of Ownership of 65 percent less than the Intel based solution, a substantial savings.

In real terms an Alliance customer will save approximately $ 68,000 over a five year period compared to an Intel server solution. We would expect the savings to be proportional or slightly higher over a 10 year period.

In the following sections we describe the methods used to determine hardware, software, and IT support staff costs. Please refer to these sections for detailed information.

Description	AS/400 and iSeries	Standard Intel Architecture

Hardware costs	$ 2,000	$ 7,978
Software costs	$ 21,175	$ 42,230

Total hardware and software	$ 23,175	$ 50,208

IT support costs	$ 13,750	$ 55,000

Total Cost of Ownership, 5 year time frame	$ 36,925	$ 105,208

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Hardware costs

The following section describes the basis for the hardware costs in this comparison. Please refer to the notes below for the details of the hardware costing.

Description	AS/400 and iSeries	Standard Intel Architecture
AS/400 memory upgrade and related support	$ 2,000
Dell PowerEdge 1550 server, 512 Meg, Single processor 1.13 Ghz, 40 Gig HD, 5 year maintenance, production server		$3,989
Dell PowerEdge 1550 server, 512 Meg, Single processor 1.13 Ghz, 40 Gig HD, 5 year maintenance, production server		$3,989

Total hardware cost	$ 2,000	$ 7,978

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AS/400 hardware

One of the advantages of the AS/400 platform is its ability to reliably run a mix of interactive, batch, and web applications and properly manage system resources. In our experience no customer has had to upgrade the memory or disk of their AS/400 to run Alliance encryption and FTP solutions. The disk utilization of the Alliance PGP option is under 100 Meg, and most users run encryption and FTP communications in a low priority batch environment. The AS/400 operating system provides resource management to balance the workload. However, as a new application Alliance would represent some added cost in hardware terms. For the purposes of this study the added cost is estimated at $2,000. In actual customer situations any upgrade would probably be made on the basis of a number of factors including increased number of interactive users, new application work loads, new Web applications, etc. [top]

Intel architecture hardware

For the purposes of this study we assume that a customer will deploy two dedicated Dell servers to handle the FTP communications and PGP encryption requirements. Since the processing requirement in most of our customers is not large, we have sized the Dell systems as entry level servers. The cost of the servers is based on list prices (November, 2001) for Dell PowerEdge 1550 rack-mounted servers with 512 Meg of RAM and 40 Gig SCSI hard drives. These systems represent a low-cost, 5.single-processor server at the entry point of the Dell server line. This configuration includes 2 NICs, 15 inch monitor, a 5-user license for Microsoft Windows 2000 server, and 5 years of Dell Bronze support.

In this comparison one Dell server will be used for production, and one will be used as both a test and Disaster Recovery server. No attempt has been made to include costs associated with rack utilization, intelligent switch or hub utilization, or other hardware costs.

Some customers may implement FTP and PGP encryption on UNIX servers instead of Intel architecture servers. The IDC study mentioned above indicates slightly lower costs associated with UNIX servers due to their ability manage workloads more efficiently. No attempt is made in this comparison to estimate hardware costs for UNIX environments. It is anticipated that software costs would be similar to Intel servers. [top]

Software costs

An Enterprise solution for PGP encryption and FTP file transfer must be able to provide a high level of reliability and integrity. Most Enterprise customers require a backup and recovery strategy as a part of any solution. Additionally, applications should be monitored so that error conditions are detected and corrected quickly. The following software components are the minimum required to meet these goals.

The following section describes the basis for the software costs in this comparison. In all cases the list prices of software applications have been used. Prices were current as of November, 2001. Please refer to the notes below for the details of the software costing.

Description	AS/400 and iSeries	Standard Intel Architecture

Alliance PGP Option processor group P20 with standard discount, 5 year maintenance, production server	$ 13,125
Alliance PGP Option processor group P10, 5 year maintenance, test and DRP server	$ 8,050
Network Associates eBusiness Server PGP, perpetual license, 5 years maintenance, production server		$ 18,000
Network Associates eBusiness Server PGP, perpetual license, 5 years maintenance, test and DRP server		$ 18,000
Back up software, included with OS/400	$0
ARCserve 2000, 5 years maintenance, production server		$ 1,895
ARCserve 2000, 5 years maintenance, test and DRP server		$ 1,895
FTP server, included with OS/400	$0
FTP server, Ipswitch FTP Pro, 5 years maintenance, production server		$ 870
FTP server, Ipswitch FTP $ 870 7.Pro, 5 years maintenance, test and DRP server		$ 870
AS/400 systems monitoring. Included with Alliance PGP Option at no charge, Production server	$ 0
AS/400 systems monitoring. Included with Alliance PGP Option at no charge, test and DRP server	$ 0
BMC Patrol for Windows 2000, 5 years maintenance, production server		$ 1,220
BMC Patrol for Windows 2000, 5 years maintenance, test and DRP server		$ 1,220

Total software cost	$ 21,175	$ 42,230

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Alliance PGP Option

The Alliance PGP Option is a part of the Alliance FTP Manager product from Patrick Townsend & Associates. The prices for Alliance software are taken from the published list prices and include a standard discount for a second AS/400 CPU. Alliance software is priced on a per-CPU basis with no restrictions on the number of users or number of connections. Alliance customers may also run multiple versions of Alliance software in LPAR partitions without additional charges. The pricing includes standard business hours support for the 5 year time frame. [top]

Network Associates eBusiness Server

Network Associates offers several PGP encryption products. For desktop users they offer “PGP Corporate Desktop” which encrypts files, provides network security, and encrypts hard drives. This product is designed for single desktop users and does not provide for automation of PGP tasks. You cannot, for example, script the encryption or decryption of files and schedule them for transmission. For this reason the desktop product was not included as a basis for comparison. Additionally, Network Associates has indicated that the PGP Desktop product would be sold and no longer supported by Network Associates. This is likely to further weaken the product in Enterprise environments. Only the eBusiness Server PGP product is included for comparison. It is the product most commonly found in commercial environments for mission critical PGP encryption processing.

Network Associates provides two options for licensing eBusiness Server. The first option is a two year subscription license with no phone support. The second option is a perpetual license. For the purposes of this comparison we have used the perpetual license as it most closely resembles the Alliance one-time license fee structure. The 8.pricing includes standard support for the 5 year time frame. There is no published discount for multiple systems. [top]

AS/400 backup software

The AS/400 operating system includes support for backup and recovery operations. Many AS/400 customers use the native support for backup. Unlike Intel servers the AS/400 support for tape backup and recovery is adequate for most applications. Since Alliance products do not have extensive backup requirements this comparison assumes use of the AS/400 utilities and no additional cost. [top]

ARCServe for Windows 2000

ARCServe is one of the most common backup and recovery applications for Windows platforms. The version included in this comparison is for the entry level price for a Windows 2000 server. Two licenses are required for the Dell servers. Note that the cost of an ARCserve license may be lower depending on the number of servers in your environment, and the purchase agreement you have for ARCserve software. [top]

AS/400 FTP Server

The AS/400 operating system includes FTP client and server applications. The tight integration of these applications with native AS/400 security makes them commonly used for mission critical applications. The Alliance product also includes an optional security application named Alliance FTP Security. Because there is no charge for the AS/400 FTP server, and because the Alliance FTP Security product is included at no additional charge, there are no additional costs associated with the FTP server on the AS/400. [top]

Ipswitch FTP Pro Server

The Ipswitch FTP server is added to the Intel architecture solution because the existing Microsoft IIS server is generally thought not secure enough for Enterprise environments. The Gartner Group has recommended not deploying IIS due to security problems. A good alternative is the FTP Pro Server product from Ipswitch. It is reasonably priced and provides good audit trails of FTP activity. Two licenses are included in this comparison. [top]

AS/400 systems monitoring

The AS/400 includes system monitoring capabilities for network interfaces. Alliance also provides the Alliance Application Monitor as a no-charge component of the PGP Option. Alliance Application Monitor provides monitoring of several aspects of the AS/400 environment including disk utilization, network interfaces, application jobs, subsystems, SNADS distribution queues, and network services. Error conditions are 9.reported via SNMP trap messages, SMTP email messages, and operator alerts. Application monitoring is an essential component of an Enterprise solution. [top]

BMC Patrol for Windows 2000 Server

A variety of monitoring applications are available for Microsoft Windows 2000 server. One of the more common solutions is the BMC Patrol product. Patrol monitors disk utilization, application jobs, and network interfaces. It is a mature product and runs on mainframe, UNIX, and Windows platforms. Two licenses are included in this comparison. [top]

Support costs

It is sometimes difficult to identify real support costs for various platforms. The IDC study mentioned above suggests that AS/400 shops utilize one IT support person for each 3.5 servers. Comparable Intel server shops utilize one IT support person for each 1.3 servers. While it is generally accepted that the number of IT support staff is higher for Intel servers, we believe that the IDC figures apply to complex ERM applications. For the purposes of this comparison we assume a ratio of 10 Intel servers per IT support person. Since this comparison specifies 2 Intel servers we allocate 20 percent of a full time IT staff person for support.

For the AS/400 calculation we believe that Alliance products require minimal IT support. We have allocated 5 percent of a full time IT staff time allotment for the Alliance PGP option.

Note that in the results summary above we separate support costs from the hardware and software costs. While support costs are real and often represent the largest component of a solution’s overall cost, they vary widely from one customer to another.

Description	AS/400 and iSeries	Standard Intel Architecture
AS/400 IT support staff. 5 percent of Full Time Equivalent at burdened cost of $55,000 per year, 5 years	$ 13,750
Intel architecture IT support staff. 20 percent of Full Time Equivalent at burdened cost of $55,000 per year, 5 years $ 55,000		$ 55,000

Total support cost	$ 13,750	$ 55,000

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Conclusion

The above comparison shows that the Total Cost of Ownership of Alliance PGP software is substantially less than the cost of an equivalent solution on an Intel architecture platform running the Microsoft Windows 2000 operating system. When considering just hardware and software direct costs the Alliance solution on AS/400 is 54 percent less than the cost of the Intel architecture solution. When support costs are included the cost of the Alliance solution on the AS/400 is 65 percent less than the Intel Architecture. This is almost one third of the cost of the Intel solution!

In real terms an Alliance customer will save approximately $ 68,000 over a five year period. We would expect the savings to be proportional or slightly higher over a 10 year period.

Even when running Alliance products on larger AS/400s an Alliance customer can expect to enjoy substantial savings over comparable Intel and Microsoft solutions. [top]