Data Center Server Consolidation – Step #4 – Analyzing Virtualization Costs

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So you now understand the benefits of virtualization. You did your research on server consolidation, and you know virtualization applications you want to use. But how much does virtualizing server infrastructure cost and how much can it save your company?

The benefits of virtualization can be plentiful, but only if you plan accordingly. Before starting any project, it’s important to analyze the cost and potential savings (ROI). On average, each virtualizated machine can reduce hardware and software costs as much as 50% and energy costs by 80%, saving more than $3,000 per year per virtualized server.* Check out VMware’s ROI calculator (you’ll need to register) to easily calculate your ROI. For example, consolidating 20 servers down to 3 can produce a savings of $85,000 in real estate and $200,000 cost savings for heating and cooling, energy, hardware, etc. costs over 3 years.

In general, the benefits of virtualization include fewer servers, fewer infrastructure costs, less electricity, less space, less maintenance, and so much more. Even without using numbers, these benefits of virtualzation seem like obvious money-savers.

Some things to consider when budgeting for virtualization are heating and cooling costs (virtualized servers run at a fuller capacity, and often produce more heat), management (patching, backup, provision, monitoring, security, and more), and other hardware that may be needed for server consolidation.


*Numbers obtained from VMware website:

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