Tuesday, January 28, 2003

Drivel:  John Robb posted an estimated per user per month model for a weblog system.  I would challenge his model with a more robust TCO model illustrated below.

Decentralized Weblog System
Licenses of Radio cost $40 per year, or $3.33 per month.  Per user per month depreciation of a $5k server over 36 months and spread over 1,000 users is $0.14.  Let's assume that 1,000 users consume 1.54Mbps on average at a cost of $450 per month, leaving you with a $0.45 per user per month cost for bandwidth.  Fixed deployment costs will be approximately $2700 for a sys admin to spend a week configuring the installation image of Radio, testing it, configuring the RCS server, testing it, and deploying Radio to 1,000 users.  Ongoing operational costs will be approximately 0.25 FTE at a annual loaded cost of $100,000.  This tranlates into $2.08 per user per month.

What's the TCO of a decentralized weblog system?

  • Per user per month cost:  $6.00
  • Setup cost:  $2,700
  • 1st year operating cost:  $74,700
  • 2nd & 3rd year operating cost:  $72,000

Assumptions:

  • No more than 1,000 users are using the system at any time.
  • Costs may be reduced by supporting more than 1,000 users on one RCS server.
  • Support costs may be more depending on user sophistication and initial configuration of Radio.
  • Planning costs are not included in this model.
  • No initial development is required.

Centralized Weblog System
A centralized weblog system to support 1,000 users will require a minimum of two $5k servers, costing $0.27 per user per month.  3Mbps at a cost of $0.90 per user per month will be required to support user traffic.  Two weeks will be required to deploy the system at a cost of $5400.  1 FTE at an annual loaded cost of $100,000 will be required to support the system.  This tranlates into $8.33 per user per month.

What's the TCO of a centralized weblog system?

  • Per user per month cost:  $9.50
  • Setup cost: $5,400
  • 1st year operating cost:  $119,400
  • 2nd & 3rd year operating cost:  $114,000

Assumptions:

  • No more than 1,000 users are using the system at any time.
  • No license fees are required for the software chosen.
  • Costs may be reduced by supporting more than 500 users on one server.
  • Support costs may be more depending on user sophistication and initial configuration of the system.
  • Planning costs are not included in this model.
  • No initial development costs are required.  It is highly likely that some initial development costs will be required with Open Source software.

As you can see, the support costs are the key to running a cost effective weblog system.  Support and development costs tend to be higher for Open Source software than for off-the-shelf software.  Open Source is a great solution when your when the cost of retaining staff is less expensive than licensing and maintaining commercial software.  Weblog systems don't fall into this category -- yet.

 

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