Managed Servers versus Leased Servers
7 Differences Between
Managed Dedicated Servers and Leased Servers
People often compare contracting for a managed server with leasing a server. What’s the difference? A ton. It’s like the difference between leasing a ship and taking a cruise or leasing a car and taking a cab. The difference isn’t just between a raw component and a complete service, it also impacts the total cost of total cost of ownership (TCO).Here are some differences to compare between using a managed dedicated server and leasing a server:
#1 – Consider the Setup Costs: Who’s going to unpack, configure, test and start the server? It’s easy to underestimate the time and importance of setting up the server right the first time. If you don’t build the server properly, the software won’t run properly or it will be highly insecure.
Leased Server: Hire a Systems Engineer to configure the server properly. To properly build, test and deploy a server can take 2 days of an engineer’s time. At $100/hour that’s $1,600.
Managed Dedicated Server: Online Tech sets up the hardware, tests it, mounts it in our server racks, installs the OS all patches, scans for viruses, sets up the security, networking and firewall, installs multiple OS add-ons and any other software you wish. Savings: $1,600.
#2 – Consider the Physical Security Costs: Where are you going to put the server? Will it be secure? Could the janitor pick it up and walk out with it? Managed Dedicated Server: Online Tech sets up the hardware, tests it, mounts it in our server racks, installs the OS all patches, scans for viruses, sets up the security, networking and firewall, installs multiple OS add-ons and any other software you wish. Savings: $1,600.
Leased Server: For any level of security, you’ll need to commit to a data closet with a locked door, proper cooling, maybe webcams or biometric finger print reader, alarms and other systems to protect the server from physical damage or loss or at least provide some forensic evidence as to who stole it should it go missing. The closet with proper cooling can start at $1000.
Managed Dedicated Server: Online Tech places your dedicated server is in our SAS-70 audited data center with dual-factor authentication and biometrics for physical access, video cameras and locked in a secure private cage or rack. Savings: approximately $1000.
#3 – Consider the Quality of the Internet Connection: How are you going to connect your server to the Internet? Will it be secure? What happens if your internet connection goes down for a few hours? How expensive is an Internet failure?
Leased Server: For the same level of uptime, you’ll need to contract for two different Internet companies and put both internet connections into a network router and program to sense when one of the connections fails and automatically fail over to the backup connection. Cost: $500 to $1000 for the network device and programming plus an additional Internet connection. An extra T1 line is likely to cost an extra $400 - $500 per month.
Managed Dedicated Server: All Online Tech dedicated servers have dual, redundant connections to our redundant Cisco network which is connected to two separate Internet providers over gigabit fiber connections. It’s an infrastructure few companies can afford for themselves. Savings: $500 - $1000 upfront and $400 - $500 per month.
Managed Dedicated Server: All Online Tech dedicated servers have dual, redundant connections to our redundant Cisco network which is connected to two separate Internet providers over gigabit fiber connections. It’s an infrastructure few companies can afford for themselves. Savings: $500 - $1000 upfront and $400 - $500 per month.
#4 – Consider the Internet Security: A “naked” unprotected server on the Internet will be found and compromised by Internet robots in less than 45 minutes. So how are you going to secure the server from hackers?
Leased Server: Buy and manage security devices such as firewall; Intrusion Detection; Port Scan; SQL Injection and other types of attacks. You can hire a company to audit your server every 90 days and suggest/recommend additional security measures to keep abreast of the threats as they increase exponentially. These can be purchased for between $500 and $5000. Budget 4-8 hours of engineer time ($400 - $800) to setup the device and a few hours a month to monitor it do updates so you can stay ahead of the hackers. You’ll also need to budget 20% of the price of the security device for an annual subscription for virus updates. In the end the security will cost you more than the server and you just can’t live without it.
Managed Dedicated Server: All Online Tech dedicated servers are protected by hardware firewalls with an easy upgrade to the state of the art Universal Threat Management offering powered by WatchGuard. These provide protection against Port Scans, Intrusion Detection and other nefarious threats. Savings: $900 - $5800 plus $100 - $1000 per year on maintenance.
Managed Dedicated Server: All Online Tech dedicated servers are protected by hardware firewalls with an easy upgrade to the state of the art Universal Threat Management offering powered by WatchGuard. These provide protection against Port Scans, Intrusion Detection and other nefarious threats. Savings: $900 - $5800 plus $100 - $1000 per year on maintenance.
#5 – Consider the Costs of Backing Up Your Data: How are you going to backup the information on the server? How are you going to protect from data-loss due to fire, flood or theft of your data?
Leased Server: You can purchase a tape backup system with tapes or a disk backup system and take the data offsite to your home or other place regularly. If your building burns down at least you won’t have a total data loss. You should consider what happens if you misplace the backup data? Will your data be secure? Backup hardware and software can run $200 to $1,000. Also be sure to budget 2-4 hours per week of someone’s time to get the backups prepared and to make sure the backups are completed properly.
Managed Dedicated Server: Online Tech’s offers tape-less, no-touch onsite and offsite (replicated through our private network to a data center 50 miles away) backup, much more cost effectively than having someone come and pick up your tapes. Savings: $200 - $1000 plus 2-4 hours per week of time.
Managed Dedicated Server: Online Tech’s offers tape-less, no-touch onsite and offsite (replicated through our private network to a data center 50 miles away) backup, much more cost effectively than having someone come and pick up your tapes. Savings: $200 - $1000 plus 2-4 hours per week of time.
#6 – The Power Isn’t Free: Did you know that for some servers it can cost as much to power the server as it does to purchase it? When calculating the power costs, don’t forget the cooling. If you have a server that draws 500 watts of power, it will cost at least another 500 watts to cool it. 500 Watts of power costs about $40/month (.12 cents / KWHr), plus the cost to cool it is another $40/month – so that’s $80/month just for the power. And that’s “raw” power (see our blog entry on data center power). You also need to protect against power spikes and brownouts as they can actually damage the server.
Leased Server: At a minimum, purchasing an Uninterrupted Power Supply (UPS) to keep your server running for a few hours when you lose power will run about $1000- $1500. After several hours, you need a generator to keep the server, network and Internet connection gear powered. Generators are extremely capital intensive.
Managed Dedicated Server: All dedicated servers at Online Tech are kept in one of our SAS-70 audited data centers which include industrial size Uninterruptible Power Supplies (UPS) and at least one generator. Savings: $1000 - $1500 plus generator backups.
Managed Dedicated Server: All dedicated servers at Online Tech are kept in one of our SAS-70 audited data centers which include industrial size Uninterruptible Power Supplies (UPS) and at least one generator. Savings: $1000 - $1500 plus generator backups.
#7 – Monitoring Your Server 7x24: Servers are very reliable today. But the demand for them to work 7x24 has increased dramatically over the years. For this reason, many aspects of a server should be monitored. How are you going to monitor that the server is not low on disk space or running out of memory before you have a problem?
Leased Server: You can contract a number of online providers to monitor your server (about $10-50 per month) and notify you if a threshold is met. It is then up to you to get to the server (either physically go to the server or log in somehow) and see what the problem is, diagnosis it and fix it. It’s the response and repair that can be really expensive, especially if you need it on very short notice.
Managed Dedicated Server: At Online Tech we monitor your server from multiple monitoring locations (including some from other geographies on the Internet) so that we always know the state of your server. Any issues cause alarms to be immediately sent to multiple engineers who then will pounce on the problem and work to resolve the issue and get the server back on line. Savings: $10 - $50 per month plus response time to alarms.
Managed Dedicated Server: At Online Tech we monitor your server from multiple monitoring locations (including some from other geographies on the Internet) so that we always know the state of your server. Any issues cause alarms to be immediately sent to multiple engineers who then will pounce on the problem and work to resolve the issue and get the server back on line. Savings: $10 - $50 per month plus response time to alarms.
Summary
Of course, managed servers come at a premium over leasing a server, but when you add up all of the factors involved in the total cost of setting up and maintaining a leased server for an always-on, always-online application, a dedicated server can deliver a significant cost savings, not in just the set-up of the server, but over the entire life of the server. Managed Servers can allow you to focus your money, management time and expertise on more core functions.
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