Reducing Integration Total Cost of Ownership (TCO)

  • By Chris Haddad
  • 7 Oct, 2013

If you run IBM WebSphere Enterprise Service Bus or Oracle SOA Suite, you can reduce your Integration Total Cost of Ownership by choosing an alternative with a significantly better value proposition. Red Hat Fuse or WSO2 Enterprise Service Bus will save your project sponsor millions of dollars over a three-year period (refer to summary table below). By decreasing spend on integration middleware, you may free up enough capital to invest in mobile, API management, or analytics without increasing IT spend.

The Proprietary Moat has Disappeared

In the dark past, there was only one credible solution, IBM; a company with advanced technology, deep intellectual property, and enterprise-class support. One score and two years ago, the birth of open source (i.e. Linux, BSD) radically changed available choices. The open source communities quickly became proving grounds for creative experimentation and innovation. The LAMP stack (i.e. Linux, Apache HTTPD, MySQL, Perl/PHP) unclenched the big vendor stranglehold and democratized information publishing and eCommerce.

In the recent decade, professional open source middleware vendors (i.e. JBoss, WSO2), working with the open source community, have advanced and expanded application platform, integration platform, and governance platform components to a competitive level. The open source evolution is a classic case study of The Innovator’s Dilemma disrupting the corporate moat traditionally seen as a barrier to entry. Open source middleware vendors deliver more innovative technology, tuned for enterprise use cases, backed by enterprise support, and offered at a more affordable price point.

Enterprise IT inertia is the only remaining proprietary moat

But Enterprise IT inertia, which maintains the status quo, no longer enables your business to keep pace and address today’s business drivers.

While comparing vendor innovation and demonstrating vendors falling from leadership position on feature breadth and depth may be an esoteric exercise (after all, are you ready to adopt New IT today and gain a business edge), showing you how to increase IT value by directly lowering the vendor tax may be more compelling and relevant.

Integration Total Cost of Ownership (TCO) Summary

I recently ran an integration TCO analysis using publicly published numbers for ESB servers, and even after including the sizable ‘courtesy discount’, found three to eight million dollars can be ‘saved’ by selecting open source alternatives.

TCO Analysis over 5 Years Year 1 Year 2 Year 3 Year 1 – 3 TCO Year 4 Year 5 Year 1 – 5 TCO
Oracle SOA Suite $1,028,057 $1,208,457 $1,388,857 $3,625,370 $1,569,257 $4,473,027 $9,667,655
IBM WebSphere ESB $456,617 $542,409 $628,201 $1,627,226 $713,993 $1,998,051 $4,339,271
Jboss Fuse $60,057 $92,457 $124,857 $277,370 $149,157 $232,127 $658,655
WSO2 Enterprise Service Bus $142,382 $131,382 $171,382 $445,147 $235,382 $310,529 $991,059

Table 1. Integration TCO Summary

The TCO analysis considers initial acquisition cost, proof of concept evaluation, support, and recurring DevOps activities. The project implementation scales from 16, 32, 48, to 64 cores over a five year adoption timeframe. The full analysis spreadsheet is posted on the web.

IT Business Bottom Line

By decreasing your IT expenditure on integration middleware, you may free up enough capital to invest in mobile, API management, or analytics without increasing overall IT spend.

I realize your cost structure may vary considerably. The big tax vendors commonly offer significant discount from published list prices. What are you paying for your ESB, and what relative value are you obtaining?

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