Carve Out Costs with Red Hat

Experiencing pressures to lower IT costs?

Red Hat can supply solutions to fit customer needs in the face of economic challenge and tightened IT budgets.

At a high level, why is Red Hat relevant to customers experiencing the pressures of the current economic downturn?

In today's high pressure economic environment spending wisely on IT has become a necessity. So undertaking a careful comparison of open source software and proprietary software is the prudent thing for any IT manager to do. The explosion of open source deployments over the past few years is clear proof of what customers who have migrated to open source have experienced: Dramatic cost savings combined with the flexibility to meet today's rapidly changing business requirements.

In too many cases budget cuts result in the sacrifice of service or quality. But open source solutions from Red Hat and JBoss have shown that standards-based open source software delivered via a subscription offers customers exceptional value, performance and service without sacrificing quality. In fact, customers not only benefit from up front costs, but also from lower "people costs" as well.

Customer Profile: I'm a customer with a problem to be solved

1. My IT budget is being cut by 20%. How can Red Hat help me maintain/increase the power of my architecture while I deal with this decrease in spend?

Costs can primarily be cut in three dimensions: hardware, software, staff. Red Hat can help in all of these dimensions:
  • Poor utilization of hardware, which is a problem that most customers suffer, can be dramatically improved through virtualization technology and the raw performance that open source software delivers. Put simply, a server running Red Hat Enterprise Linux will do more work in less time than a server running Windows or Unix. Or you can use a cheaper server to do the same amount of work.
  • The cost to obtain and maintain open source software is cheaper than proprietary equivalents. Period. This is because development costs are lower and there is vigorous competition between suppliers.
  • Staffing costs are reduced for both Red Hat Enterprise Linux and JBoss Enterprise Application Platform customers. Additionally, Linux systems are more secure than any other, so fewer remedial activities are needed. And Linux management tools are better suited to managing multiple systems efficiently. Ultimately, you get more value from your IT staff. This happens because system managers are generally of higher skill levels due to the high level of knowledge that can be gained about open source systems. This is reflected in high efficiency when maintaining open source systems.The principle is applicable to JBoss Enterprise Middleware as well. In an independent study, findings indicate that to JBoss Enterprise Middleware, BEA (now Oracle) WebLogic required 18% higher staffing costs to implement and 7% higher staffing costs for ongoing maintenance, while IBM WebSphere required 23% higher staffing costs to implement and 9% higher staffing costs to maintain.

2. I need to improve the value that I extract from my systems, but am concerned with drastic change given the current economic climate. What can Red Hat offer?

Red Hat understands that risk is not popular at any time, and especially today. Naturally, the prudent strategy is to deploy new IT technologies that offer substantial, guaranteed benefits for little or no risk. Red Hat technologies deliver on multiple fronts:

  • With virtualization it is possible to improve operational efficiency while not changing the application environment at all. For example, a server can be virtualized with Red Hat Enterprise Linux 5, and then run existing Windows or Red Hat operating systems and applications as virtual guests, with no changes at all. The result: Much better use of hardware with no more risk than the time taken to deploy and test.
  • The principle is applicable to JBoss Enterprise Middleware as well. In an independent study, findings indicate that to JBoss Enterprise Middleware, BEA (now Oracle) WebLogic required 18% higher staffing costs to implement and 7% higher staffing costs for ongoing maintenance, while IBM WebSphere required 23% higher staffing costs to implement and 9% higher staffing costs to maintain.
  • By investing in Red Hat Training you can ensure that your staff are knowledgeable and skilled on any Red Hat or JBoss technology. Courses are hands-on and highly regarded for being demanding and relevant to real world environments. In fact, you can calculate your training return on investment here: www.redhat.com/training/corporate/roi_calc.html
  • Red Hat Consulting offers risk-mitigation via subject matter experts who can ensure new deployments are up and running quickly and smoothly and increase your time to value. Red Hat consultants also maximize your ROI by ensuring you're deploying Red Hat and JBoss in the most cost-effective manner, gleaning all the cost-savings and value possible.
  • Through Red Hat Exchange, Red Hat has partnered with a number of business application providers who offer supported, stable and high-performing open source solutions today. The applications available through RHX are backed by companies you can count on to provide the comprehensive services you expect with enterprise software.

3. I know I have hardware and software in my infrastructure that I am paying a premium for that is under-utilized. I can't afford waste right now. How is open source able to solve this issue?

Dealing with an excess inventory of hardware, or under-utilizing expensive software that you are locked into is never easy. On the hardware side, a common problem is "one application per server." This can result in significant waste. Red Hat virtualization technology can help with this:
  • Take the most powerful servers, virtualize them, and run your applications in virtual servers - without changing the application or its operating system, Windows or Linux. Then you can retire the old physical server.
  • The challenge of moving from expensive, proprietary operating systems and application environments to a modern Linux and open source environment differs for every customer. The transition from Unix to Linux is typically straightforward, as is moving Java/J2EE applications to JBoss & Red Hat Enterprise Linux. For Windows environments it is sometimes easier to treat the entire software stack as a virtual appliance and move it in its entirety to a virtual server. Meanwhile, many ISV applications are supported on Red Hat Enterprise Linux, so moving is straightforward.

Customer Profile: I'm a customer with urgent needs

4. I'm aware that technology has become a competitive advantage for many of the competitors in my market segment. I have to keep up and need help now, but have to be mindful of the economic situation. How can Red Hat help me now?

Talk to us. Red Hat and JBoss Enterprise technology, products and services are right at the forefront of IT capabilities. Open source solutions are proven to offer better performance, better security, more choice and more flexibility at a lower cost than competing environments. So a Red Hat solution is certain to offer better value for money than anything else on the market, allowing you to stay ahead of your competitors while keeping costs under control - whether it's middleware, virtualization, security, performance, system management or applications. But every customer has different needs, so, talk to us and let us work with you to identify how you can win in today's economic climate.

5. I have got to cut costs NOW. What can Red Hat do to help?

Red Hat can help cut costs throughout your IT infrastructure. There are two dimensions: CapEx and OpEx - capital expenses and operational expenses. For maximum benefit, both these expenditures should be tackled. For example:
  • Use virtualization to optimize your hardware resources and improve your day-to-day operational flexibility. Consolidate your servers (CapEx), improve your availability (OpEx).
  • The principle is applicable to JBoss Enterprise Middleware as well. In an independent study, findings indicate that to JBoss Enterprise Middleware, BEA (now Oracle) WebLogic required 18% higher staffing costs to implement and 7% higher staffing costs for ongoing maintenance, while IBM WebSphere required 23% higher staffing costs to implement and 9% higher staffing costs to maintain.
  • Use Red Hat Satellite and JBoss Operations Network system management products to simplify the management of your systems - up to 1,000s of them. Allow your system administrators to be much more productive (OpEx).
  • Use products such as Red Hat Enterprise MRG and Red Hat Enterprise IPA to optimize your environment. MRG provides high performance messaging, realtime and grid capabilities, while IPA provides Identity, Policy and Audit capabilities. Together these products deliver improved performance and improved security. (CapEx and OpEx)
  • Use Red Hat Training to ensure rapid, successful deployments and ensure a skilled staff to keep your IT organization running smoothly. Downtime is the surest way to negate cost savings. (OpEx)
  • Through Red Hat Exchange, Red Hat has partnered with a number of business application providers who offer supported, stable and high-performing open source solutions today. The applications available through RHX are backed by companies you can count on to provide the comprehensive services you expect with enterprise software.

Customer Profile: I'm a customer examining my options

6. I've got a mixed environment with some legacy Unix systems still hanging around. How would standardizing on Linux help my bottom line?

Standardizing on Linux, and Red Hat Enterprise Linux specifically, would reduce your bottom line costs in several ways:
  • Consistency. Having a consistent environment saves costs by being easier to manage and more flexible. You can start to think of your environment as a cloud of compute resources on which you deploy applications - and in a consistent environment you can run any application, anywhere, at any time. Applications are the same everywhere, system management procedures and tools are the same everywhere, resources can be scheduled with maximum efficiency.
  • Commoditized hardware. Red Hat Enterprise Linux will run on many different systems, from x86 to mainframe, so there is no need to use traditional, expensive, proprietary Unix servers. With Red Hat Enterprise Linux you enjoy Unix maturity on commodity hardware.
  • Ecosystem. Red Hat Enterprise Linux has a huge ecosystem of certified applications and hardware systems. You can be sure that the applications you want are available to run on the system you want. Today, ISV vendors certify Microsoft Windows and Red Hat Enterprise Linux first. Meanwhile, the certification of applications on Unix is steadily waning as the market share of Unix shrinks. Standardizing on Linux today is standardizing on a growth environment - where more competition continuously works to reduce costs.
  • Use Red Hat Consulting's Core Build Service and let a consultant design a custom Red Hat Enterprise Linux distribution for your organization. Compared to doing this same work in-house, you'll save time, money, and ensure your custom build is being deployed consistently. Calculate your increased return on investment with this calculator: www.redhat.com/promo/corebuild/.
  • Through Red Hat Exchange, Red Hat has partnered with a number of business application providers who offer supported, stable and high-performing open source solutions today. The applications available through RHX are backed by companies you can count on to provide the comprehensive services you expect with enterprise software.

7. I'm using Oracle/WebLogic, but have heard about JBoss as a less expensive alternative. What would be the advantage to switch now?

The advantage of switching to JBoss now is simple. The current economic conditions make the cost benefits of JBoss Enterprise Middleware more compelling than ever, while their capabilities and performance are highly competitive, at any price. On the the other side of the coin, Oracle's recent price increase for, WebLogic makes it an even more xpensive platform for strategic deployments.

Meanwhile, the JBoss Enterprise Middleware portfolio of products provide a stable, cost-effective, open source and open standards middleware reference architechture for the long term. Many customers have been using JBoss to develop their middleware applications for years.Now more than ever it makes sense freeze deployments on expensive proprietary platforms and shift to an enterpise-class open source alternative.

8. Why would a subscription model deliver better value to me at a lower cost than a traditional licensing model, and how quickly would I see the financial impact of moving to a vendor with a subscription model?

Every vendor is able to provide a TCO spreadsheet that proves their solution is the lowest cost - which, unfortunately, makes all of them hard to believe. The point to bear in mind is that, with a traditional licensing model, there are usually several distinct purchases that are needed for a real-world, practical deployment. These can include the base software license cost, annual maintenance cost, version upgrade cost, client access license cost, and so on. And many variables to these costs can make the total pricing very difficult to understand. For example, how many incidents does the maintenance contract allow, or, can a license be moved to a replacement machine in the event of an upgrade? To further complicate matters, every vendor offers different discount programs at the time of purchase, so looking at the MSRP on a website is invariably misleading.

Meanwhile, Red Hat's subscription model is designed to simplify the use of software as much as possible, and to be as flexible as possible. There is, of course, no license cost at all, because all Red Hat source code is freely available, and usually provided under the open source GPL license. Red Hat's subscription services are fully inclusive, with unlimited support, maintenance, and upgrades all included, and no client access licenses. Furthermore, there is no need to upgrade to newer versions of the software if you don't wish to. Every release is supported for seven years - longer than the life of the average system. For locked-down systems this can significantly reduce costs. And if you do upgrade your system its subscription can simply be reallocated to the new system.

Because open source software is readily available from multiple vendors customers are free to choose their supplier. This is very different from proprietary products. So open source ensures that prices are highly competitive - to the great benefit of customers. And the benefits are immediate and long lasting.