This complimentary report entitled “Data Center Consolidation: Top 10 Best Practices for Project Success” clearly defines the “primary best practices used in consolidation projects” detailing each one. It also highlights three “Key Findings” and three “Recommendations.”

As usual Gartner has written a quality report. However this note goes beyond critical analysis, it offers sound principles and practical advice in wisely managing a data center consolidation.

Aimed at reducing waste and improving service, the government will consolidate more than 100 different email systems to just one, reduce the number of data centers to fewer than 20, and streamline networks within and between government departments.  The new Shared Services Canada entity will be responsible for data center and network services as well as email.  Resources across 44 IT departments and agencies providing these services today will transfer to Shared Services Canada.  The President of the new entity was also appointed by the Prime Minister today, and will be leading this consolidation and transformation initiative.

Finding Savings for Taxpayers

“The top priority of our Government is ensuring that our economy remains strong while we continue on our plan to return to balanced budgets,” said the Hon. Tony Clement, President of the Treasury Board and Minister for the Federal Economic Development Initiative for Northern Ontario, Tony Clement. “This is why we are squarely focused on finding savings for taxpayers and implementing the Next Phase of Canada’s Economic Action Plan.”

In the 300-plus data centers across the country, the Canadian government has some facilities with excess computing capacity and others that are straining to meet demand. In a spring 2010 report, the Auditor General noted that many IT systems are “supported by old infrastructure and are at risk of breaking down. A breakdown would have wide and severe consequences—at worst, the government could no longer conduct its business and deliver services to Canadians.” Shared Services Canada will also reduce the number of networks that connect to data centres, and streamline networks in Government buildings.

An illustration of the design for a new General Motors data center in Warren, Michigan.

Automaker General Motors will invest $130 million to build an enterprise data center at its Technical Center campus in Warren, Mich., that will allow it to reduce operating costs by consolidating its IT infrastructure into a more efficient facility. GM estimates that the energy efficiency improvements at the new data center will reduce its operating costs by as much as 40 percent.

GM said it will renovate and expand a former administrative building on its Warren campus. Design is under way on the renovation and construction, with the final phase scheduled for completion in 2015. The project is expected to create 25 high-tech jobs. GM expects the facility will qualify for Leadership in Energy and Environmental Design (LEED) certification by the U.S. Green Building Council.

Facility Will Use “Modular” Design

The new enterprise data center will use a “modular design” to allow for future expansion, according to GM, which didn’t offer additional details. Modular designs often use factory-built structures, but the term is increasingly being used to describe phased build-outs using pods of raised-floor space. The facility will contain IT laboratories to run computer simulations for vehicle deigns, and serve as a hub for monitoring GM’s digital applications globally.

“This new facility and other GM data centers around the world support the tools the company needs to design, build and sell the world’s best vehicles through digital applications enabling all business functions,” said Terry Kline, GM vice president and chief information officer. “This investment is possible because of the cooperation between GM, the Warren community and the Michigan Economic Growth Authority. We think the result is a win for everybody involved.”

The company is announcing the new facility in a press conference this morning in Warren. We’ll provide additional details as they are available.

The interior of a government data center in Rockville, Md. that has been closed, saving $1.2 million a year in energy costs. Is that really carpeting atop the raised floor tiles?

The U.S. government has shut down 39 data centers so far this year, and expects to close 98 more by the end of 2011, federal Chief Information Officer Vivek Kundra said today. That would yield a total of 137 data centers shuttered in the first year of the Obama administration’s effort to eliminate waste by consolidating government data centers.

Kundra says the roadmap calls for 800 of the government’s 2,094 data centers to be closed by 2015, with their workloads shifted to more efficient data centers or cloud computing platforms.

The consolidation effort will accelerate in the next 18 months, as the task force heading the effort will create a government-wide “marketplace” to make more efficient use of data center space. “This online marketplace will match agencies with extra capacity to agencies with increasing demand, thereby improving the utilization of existing facilities,” according to the implementation plan (PDF) for the consolidation. The marketplace will help agencies with available capacity promote their available data center space. Once agencies have a clear sense of the existing capacity landscape, they can make more informed consolidation decisions.”

Public Dashboard to Track Consolidation

The implementation plan also calls for the details of the consolidation to be shared with the public. The Office of Management and Budget “will launch a publicly available dashboard to serve as a window into progress of the data center consolidation program,” the plan says. “The dashboard will ensure transparency and accountability, and keep the overall program in plain view of the public.”

Towards that end, the government has published the list of data centers that have been closed or targeted for closure. The data is available in a comma-separated list from Data.gov or at the Washington Post. NASA has been the most active agency thus far, consolidating 13 of its 14 data centers, while the departments of Defense (8), Commerce (6) and the Interior (4) have also closed multiple data centers.

What kind of savings is the government realizing from these efforts? Kundra highlighted a project to consolidate a Rockville, Maryland data center operated by the department of Health and Human Services (HHS). The 15,000 square foot data center contained 218 racks of gear, and had an annual power bill of $1.2 million.

The Department of Defense will be the busiest consolidator for the balance of 2011, as it is scheduled to close 43 more data centers by year-end.  Other agencies with many closures slated include the Department of the interior (14 more) and the Department of  Agriculture (10 more).

‘Cloud First’ Focuses on Email, Storage

Kundra also highlighted the government’s plan to use a “cloud first” policy in shifting IT assets to third-party platforms wherever it is practical and meets the government’s security standards. The earliest targets are email and cloud storage.

The office of the CIO said Wednesday that 15 agencies have identified approximately 950,000 mailboxes and over 100 email systems that will move to the cloud. On the storage front, the Department of Justice is consolidating storage solutions across 250 locations for 18,000 U.S. Attorneys to a single cloud platform. “Hundreds” of human resource and financial management systems will be consolidated in the cloud, the CIO’s office said.

Despite that progress, serious challenges remain in the government consolidation effort. A survey of federal IT managers by research firm MeriTalk and storage vendor NetApp found that while IT decision makers have consistent data center definitions within their own agencies, there is a lack consistency government-wide. Agencies are using at least three different definitions to qualify data centers MeriTalk said in its summary of the survey of more than 150 managers.  Some agencies report they are using a physical server count as a tracking metric, others use the storage capacity utilized, and still others use network bandwidth.

But on the whole, the MeriTalk/NetApp survey found that federal IT decision makers believe they will meet the Office of Management and Budget’s 2015 deadline to consolidate data centers, and identify a combined $18.8 billion more they can save in their IT budgets with consolidation alone.

To optimize the data center, IT executives are rethinking the deployment, utilization, and management of their IT resources. Since the datacenter has become more tightly integrated with day-to-day business operations, companies are placing greater emphasis on the operations of their IT environments. As virtualization and cloud computing gains mainstream adoption data center operators are finding converged systems and software are the building blocks for the future enterprise datacenters.

If you are currently focused on optimizing datacenter operations and undertaking consolidation initiatives you will want to read this IDC paper on converged infrastructure. Click here to learn more.

New York Mayor Michael Bloomberg tour a new data center where the city will consolidate IT operations for multiple agencies (Photo Credit: Edward Reed).

New York City has opened a new data center in Brooklyn where the city will centralize the IT infrastructure for more than 40 city agencies over the next five years. The city invested $11.7 million in equipment to outfit the 18,000 square-foot facility, and will pay $2.7 million annually to lease the space at the MetroTech Center, but stands to save it more than $100 million over five years.

The consolidation effort, known as the Citywide IT Infrastructure Services (CITIServ) Program, is part of a broader effort called NYC Simplicity that aims to make the city’s government more efficient, innovative and customer-focused.

“New York City is constantly employing new technology to improve and modernize services for New Yorkers, but until now the infrastructure behind that technology has been fragmented,” said Mayor Michael Bloomberg. “By consolidating the IT operations of more than 40 city agencies, we’ll modernize the city’s technology infrastructure while saving taxpayers $100 million in the first five years alone. And by reducing the IT work done by individual city agencies, we’ll enable them to concentrate more of their resources on what they really do best: teaching students, protecting our neighborhoods, cleaning our streets, preventing and putting out fires, and doing all the other things that improve our quality of life.”

“Through NYC Simplicity, we’re constantly looking for new ways to streamline operations, improve services and save scarce taxpayer dollars,” said Deputy Mayor steven Goldsmith. “Consolidating the City’s currently fragmented IT infrastructure into unified data centers is the latest example of how we’re becoming a more efficient City government and achieving the goals of NYC Simplicity.”

In its first days of operations, the Mayor’s Office of Media and Entertainment’ IT operations, the Department of Sanitation’s IT Service Desk, and the Department of Education’s “HR Connect” application have been moved into the centralized CITIServ environment. These systems alone support 140,000 users, and their consolidation will achieve a recurring annual savings of approximately $200,000.

In full, the CITIServ program offers:

• Application Hosting Services: standard, dedicated and virtual hosting environments with a variety of service levels, processing and memory capacities;
• Network Services: access to the City’s wired network (CityNet), voice over internet protocol (VoIP), video conferencing, and New York City’s wireless network;
• Data and Storage Services: modern, flexible storage solutions for all hosted applications;
• Collaboration Services: email with archiving, BlackBerry servicing, eFax, and instant messaging; and,
• Citywide Service Desk: a 24×7, convenient, single point of contact for end users to address IT support needs, IT issue resolution, as well as ticket generation and easily accessible modern tracking tools.

In October 2010, as part of the Simplicity initiative, Bloomberg and Goldsmith joined Microsoft CEO Steve Ballmer to announce a wide-ranging information technology agreement to consolidate the City’s dozens of individual license agreements into a single one and will provide more than 100,000 city employees with state-of-the-art computing power.

For months, Federal CIO Vivek Kundra has cited the existence of 1,100 federal data centers as evidence of government waste and inefficiency. Kundra has repeatedly used this data point to drive home the need for a major data center consolidation that will consolidate servers and drastically reduce the number of U.S. government facilities.

It turns out Kundra was massively underestimating the extent of the redundancy. The new total was included in a memo from Kundra and Department of Homeland Security CIO Richard Spires, who is coordinating the government consolidation effort.

Off by 1,000 Facilities?
How could the government lose track of 1,000 data centers? It’s not uncommon for consolidation-related inventories to uncover more servers and IT rooms than expected. The U.S. government’s effort looms as the largest data center consolidation in history, so the disconnect between initial estimates and the final count was equally epic.

The process defined a data center as any room larger than 500 square feet dedicated to data processing that meets the one of the four tier classifications defined by The Uptime Institute.

Which agencies have the most data centers? Not surprisingly, those with the most distributed operations:

• Department of Defense (772)
• State Department (361)
• Department of the Interior (210)
• Health and Human Services (185)
• Department of Energy (89)
• Veteran’s Administration (87)

The plans and budgets submitted by federal agencies are being reviewed by the administration and the Office of Management and Budget (OMB), with a goal of approving final plans by Dec. 31. The process got underway back in March, when Kundra directed federal agencies to prepare an inventory of their IT assets by April 30 and submit a preliminary data center consolidation plan by Aug. 31.

In announcing the Federal Data Center Consolidation Initiative, Kundra outlined four high-level goals:

• Promote the use of Green IT by reducing the overall energy and real estate footprint of government data centers;
• Reduce the cost of data center hardware, software and operations;
• Increase the overall IT security posture of the government;
• Shift IT investments to more efficient computing platforms and technologies.

That last bullet point is boosting expectations that a meaningful chunk of government IT operations will be shifted to a cloud computing model. Spires said in an Aug. 31 presentation that he expects some of the agency-level consolidation plans to include proposals to use cloud computing services.

The General Services Administration is in the final stages of shoring up the requirements for a government-wide program to certify and accredit cloud computing products and services through a process known as the Federal Risk and Authorization Management Program (FedRAMP).

President Barack Obama likes his Blackberry, and likes data center consolidation. On Thursday he ordered federal agenices to accelerate sales of real estate, especially data centers. (Photo: White House)

Data centers have made it to the Oval Office, albeit in a “let’s cut some costs” kind of way. On Thursday President Barack Obama on Thursday ordered the heads of federal agencies to accelerate efforts to sell or consolidate underused real estate, singling out data enters for special attention.

“Both taxpayer dollars and energy resources are being wasted to maintain these excess assets. In addition, many of the properties necessary for the Government’s work are not operated efficiently, resulting in wasted funds and excessive greenhouse gas pollution,” Obama wrote in the memo.

“For example, over the past decade, the private sector reduced its data center footprint by capitalizing on innovative technologies to increase efficiencies. However, during that same period, the Federal Government experienced a substantial increase in the number of data centers, leading to increased energy consumption, real property expenditures, and operations and maintenance costs.”

The federal government has already begun what looms as the largest data center consolidation in history, hoping to dramatically reduce IT operations that are currently distributed among more than 1,100 data centers. Obama’s memo reinforces that priority, and places a price tag on the anticipated yield. Obama said he expects the process to “produce no less than $3 billion in cost savings by the end of fiscal year 2012.”

In March, Federal CIO Vivek Kundra directed federal agencies to prepare an inventory of their IT assets by April 30 and develop a preliminary data center consolidation plan by June 30. These plans will need to be finalized by Dec. 31, 2010, with implementation beginning in 2011.

Seven Percent Utilization?
“One of the most troubling aspects about the data centers is that in a lot of these cases, we’re finding that server utilization is actually around seven percent,” Kundra said in April in which he used the utilization data to argue for the cloud computing model. Kundra made it clear that one of the goals of the governments’ data center consolidation effort will be to identify projects that can run in the cloud “instead of just webifying our brick and mortar institutions.”

Which players figure to benefit if the U.S. shifts large numbers of federal applications from in-house data centers to cloud computing platforms? See Who Are The Contenders for the Federal Cloud? for more

Ann Livermore, Executive Vice President of Hewlett-Packard Enterprise Business, said the company expects to consolidate about 100 former EDS data centers into about 50 facilities, spending $1 billion and eliminating 9,000 jobs in the process. HP’s announcement indicates that most of that $1 billion will be for severance, but some will go for infrastructure.

“Fully Automated” Data Centers
“HP will invest in fully automated, standardized, state-of-the-art commercial data centers built on its Converged Infrastructure and operated by its industry-leading management software,” HP says in its announcement. “Leveraging its experience from its own IT transformation, HP will enable clients to migrate their applications to these modernized infrastructure platforms, allowing them to run their businesses faster and more efficiently.”

Will HP build brand new, highly efficient facilities for the consolidation, as it did with its in-house effort? “HP will be consolidating data centers into existing facilities where applicable,” said HP spokesperson Jane McMillian. “We have no additional details on the $1 billion in charges at this time.”

With HP planning to offer end-to-end converged infrastructure, new facilities might work better than retrofits. But that’s not simple with the former EDS clients, as Livermore indicated.

“You won’t ever see the same order of magnitude as we’re able to do inside HP because in some instances with our clients we have data centers that are dedicated to them that they want dedicated to them,” she said. “We have certain clients who have geographic requirements for us for where they want data centers. And so you’ll not see in a services business like we have with HP Enterprise Services the same opportunity to reduce to the same number we did internally for HP. But still this is a substantial opportunity for us and something that we think is a good opportunity for our clients as well as HP.”

Federal CIO Vivek Kundra tour the NASA Nebula cloud computing container last year. Kundra has announced plans for a major consolidation of 1,100 U.S. government data centers.

In the past decade, the number of data centers operated by the U.S. government has skyrocketed from 432 to more than 1,200. The agencies building these new facilities must have been adding capacity because they had filled their existing servers and space, right?

Wrong. ”One of the most troubling aspects about the data centers is that in a lot of these cases, we’re finding that server utilization is actually around seven percent,” Federal Chief Information Officer Vivek Kundra said Wednesday in an address at the Brookings Institute. That means some agencies have been investing in new data centers instead of tapping the 93 percent of capacity available on their existing servers.

Boosting The Case for Cloud Computing 
“That’s unacceptable when you think about all the resources that we’ve invested,” said Kundra, who once again made the case for shifting government IT to a cloud computing model.

Server utilization is sometimes referenced as a “dirty secret” of IT operations. Analysts cite varying average ranges of utilization, typically ranging from 10 percent to 30 percent of available capacity. Low utilization is often attributed to servers being dedicated to a particular operating system, or the need for critical applications to be isolated from other workloads. A common solution is virtualization, which allows users to run multiple OSes on the same hardware, but is not appropriate for some applications and workloads.       

Kundra used the utilization data to argue for the cloud computing model. We’ve previously noted the “data centers are evil”narrative running through some of Kundra’s presentations. On Wednesday he discussed a specific instance in which he said the cloud model saved the government money.  

$600,000 to Launch A Blog?
“We’ve already begun our shift to cloud computing,” said Kundra. “We started with a strategy on looking at a ‘cloud first’ policy in terms of areas where we’re not compromising national security in any way or the privacy of the American people. An example with TSA was that they were going to spend approximately $600,000 to stand up a blog until the CIO came in and said, well, wait a second, why do we need to spend all this money on creating a blog when all the software is available online for free?”

Yes, you read that correctly. A government agency was going to spend $600,000 to set up a blog. While cloud hosting is one solution, that issue could also be addressed by installing free blog software on some of that underutilized server capacity, which would also be free. 

Saving $1.7 Million on USA.gov
But other early government cloud projects have produced more defined benefits. The General Services Administration recently said it is saving $1.7 million a yearby hosting the USA.gov federal information portal web site on Terremark’s Enterprise Cloud. 

The GSA previously paid $2.35 million in annual costs for USA.gov, including $2 million for hardware refreshes and software re-licensing and $350,000 in personnel costs, compared to the $650,000 annual cost to host the site with Terremark.

Kundra made it clear that one of the goals of the governments’ impending data center consolidation effort will be to identify projects that can run in the cloud “instead of just webifying our brick and mortar institutions.”

Moving Beyond Hardware Migration
“It makes no sense if consolidation is nothing more than taking 10,000 servers and moving them from ten data centers to one data center,” said Kundra. “Part of what we’re trying to do in the process of consolidating data centers is to figure out where cloud computing makes sense for the federal government.”

Kundra also announced the creation of a joint authorization board to provide security certification for cloud computing apps. The effort will be led by NIST, which will work with the departments of defense and homeland security.

The full textof Kundra’s speech is available on the Brookings web site, along with video of the event and an accompanying report from Brookings on potential savings from government cloud computing.

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