I have seen many conflicting TCO reports claiming one solution is cheaper than another, particularly with regard to Microsoft Windows versus Linux. Can these contradictory analyst reports be trusted?
QUESTION POSED ON: 08 DEC 2005
QUESTION ANSWERED BY: Tom Pisello
When an analyst develops these reports they often interview particular customers, some provided by the vendor, others independently assessed. For each interview a particular configuration is assessed and the costs analyzed. Interviewing customers with different platforms can help the analysts assess different costs and benefits of implementation. But some issues are apparent that make it easy for different reports to deliver different results, and also that make it hard to generalize the analyst's experiences with the personal TCO you may obtain. These issues include:
- TCO is very dependent on infrastructure configurations. For example, changing the specific platform from one system to another with higher price/performance can greatly effect the TCO results. With more systems and processors needed for a given configuration, price for the hardware, software licenses, management and support escalates quickly. If the analysts compare configurations where one is not price- or performance-optimized, the results can quickly handicap the platform with the lackluster/pricier configuration.
- The scope of TCO analyses often don't cover all of the important elements of costs. Many TCO analyses fail to include important hard costs such as migration and change costs, or they leave out important soft costs such as security impacts on business and productivity, business evolution and agility. A TCO chart of accounts can be established to benefit one solution versus another, especially if weaknesses are masked by the incomplete scope. Often the exclusion is not malicious and the analysts simply fail to include all of the costs in the scope.
- Many of these customers do not know their total ownership costs, and the interviews are often too brief to dig deep. For example, most organizations don't know until much discovery exactly how many resources were required to implement, deploy and then manage their assets. Therefore, the analysts may get varied credibility in their responses without knowing it. Detailed onsite surveys and digging is required to uncover the true ownership costs, but this is well outside the scope of most of these analyses' efforts.
The most important aspect to the research reports is to personalize the analysis for your own environment. Because of the unique configurations and company businesses studies, each case study is unique, and the results are not readily transferable.
So the answer on credibility is that each of these reports as a standalone is credible within the constraints and assumptions provided -- but the results are often not applicable to your own environment. It pays to assess your own particular TCO for your own particular environment, using the case study analyst reports as a guideline for your own unique expectations.
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