
Featured research

Shared enterprise hosting - a new strategy for reducing costs

01 May 2005

Imagine that instead of driving your beat up old car to work each day, and putting up with stressed out peak hour drivers, you could car-pool in a luxury vehicle owned by somebody else.

No more worries about having to replace failing parts or renewing your license. All you had to do was pay a set monthly fee, and agree on a regular departure time. For this small compromise, you enjoyed a comfortable air-conditioned ride to work, arriving relaxed and refreshed, with someone else worrying about the peak hour traffic and where to park.

In the world of hosting, many organisations are beginning to recognise the benefits of shared application hosting, a trend fuelled by the growth of server processing capacity.

In the past an enterprise application would use all the available resources of a typical server. Today, servers offer such greater capacity that in many instances, an enterprise application may only use a fraction of the server’s resources. However, many of the costs associated with running the application remain the same:

The cost of purchasing and maintaining the infrastructure is still significant.
Initial and ongoing licensing costs also form a major component of the total cost of ownership, and these are often based on the processor license only, regardless of the class of infrastructure purchased.
The human resource costs associated with implementing and maintaining the application are also similar.

Technological and cultural changes drive a new model

CITEC Software Services Consultant, Ian McFarlane says that in 2005, the concept of shared enterprise application hosting is becoming popular, thanks to technological and cultural changes on the ICT landscape.

“Advances in scalable and secure architectures such as clustering, provide reassurance for clients that an enterprise application remains securely segregated from its ‘neighbour’ in a shared hosting environment,” he said.

“Another significant cultural change relates to business continuity and IT security.

“Good corporate governance dictates that organisations are able to continue functioning in the event of a disaster, yet the cost of attaining a highly secure and available environment is significant.

“Through shared hosting, customers can access highly secure and reliable facilities with fully redundant network architecture for an entry-level price.

“They can also enjoy the flexibility of easily consolidating or increasing their server resources, through highly scalable platform and server capacity.”

What’s the flip-side?

Does all this sound too good to be true? Well, there is a flip-side and it relates to standardisation, although Ian believes the compromises required to access a shared hosting environment are not so big as to devalue the benefits of moving to such a model in the first place.

“In CITEC’s case, our front end servers run two of the industry’s leading application servers – Oracle Application Server and BEA WebLogic, while the back end servers run the Oracle database,” Ian said.

“Many of our clients’ applications are designed using Oracle Application Server or BEA product suites, so such constraints still address a significant part of our market.

“The other area of compromise involves scheduled maintenance. Because a number of clients share a server, all maintenance needs to be done at times that suit each of the parties involved.

“We haven’t found this to be a problem yet, because with good design and strong governance of configuration changes, maintenance windows can be kept short, with minimal business impact.

“As our service grows to scale as a fully clustered architecture, we see the service being able to guarantee 24x7 availability.”

CITEC’s belief in this type of hosting as a way of reducing costs is such that it has recently transferred its corporate applications to a shared hosting environment, and plans to move its critical business systems over in the near future.

According to Ian, the model also appeals to CITEC’s software development clients.

“This is an add-on service which few other software development companies can match, particularly in the area of security,” he said.

“Our ability to bundle the application build, the hosting and other functions such as data storage and backup, means clients can access an end-to-end managed solution for a predictable cost, without a major capital investment.

“Through CITEC’s certification to AS/NZ7799 and ISO9001:2000, and our adherence to ITIL processes, we can demonstrate that an enterprise application being managed in a shared hosting environment is no less secure than one with a dedicated server.”

For more information about shared enterprise application hosting, contact Ian McFarlane on 07 3224 7952 or email info@citec.com.au.