8 minute readHow Much Does Third Party Maintenance Cost?
It’s unavoidable that the costs of support for your server, storage, and network equipment start to spiral. Large-scale hardware refreshes are beyond the scope of many businesses’ budgets, or if not, unnecessary if you can keep all functionality without having to buy new equipment every few years.
That could be the case if you’re relying on – or bound to – the warranties provided by your original equipment manufacturer (OEM).
There’s a better, more cost-effective approach to avoiding equipment failure and unwelcome downtime.
Third-party Maintenance (TPM) pricing is typically 50% or less than what you would pay an OEM. Wouldn’t it be great to redirect that portion of your IT budget into more strategic technology projects and investments?
How Did We Get Here?
TPM is a more effective strategy for reducing maintenance costs, especially compared to the drawbacks and limitations of standard OEM warranties.
When you buy network, server, or storage infrastructure from an OEM, it usually comes with a support warranty. During this defined period, the OEM provides all necessary support for the equipment at no cost.
That’s great, but what happens once the warranty period expires? Well, you can still access service support under a new contract, but you’ll have to pay for that. As your equipment continues to age, the cost of support escalates. And a few years down the line, it will inevitably reach what’s called “end-of-service-life” (EOSL), which marks the time when those devices are considered the “senior citizens” of the data center. At this point, the OEM will no longer service the equipment.
This is a tactic employed by OEMs to encourage you to purchase newer versions of their kit. But you don’t need to, there’s a better way.
Why Third-Party Maintenance is Growing in Popularity Globally
TPM allows you to break away from the more narrow, prescriptive, and expensive support provided by OEMs and simultaneously extend the longevity of your server, storage, and network equipment.
With Third-Party Maintenance, you benefit from the best of both worlds: reliable and convenient support for equipment in your multi-vendor estate, irrespective of the devices’ respective ages… at an affordable price point. What’s more, these arrangements are generally more flexible and customizable, so you only pay for the types of support you need.
Reputable TPM providers employ and have access to highly skilled and experienced data center engineers. These resources are trained and certified to service a range of hardware types from manufacturers such as Cisco, Dell, IBM, HPE, and more. Most importantly, they can offer support for the hardware even if the OEM has declared it EOSL. TPM providers will also cover various manufacturers and hardware families under a single contract, streamlining administration and management.
What’s the Catch?
You may be wondering how TPM arrangements can be so much more affordable and convenient than what OEMs can offer.
In answering this question, it’s helpful to consider these respective organizations’ business models. IT equipment manufacturers operate in a highly competitive and expensive market. In recent years, consolidations, new market entrants, and the emergence of cloud-based models have squeezed their margins. In response, they’ve channeled time and resources into R&D, innovation, advertising, and sales efforts. OEMs profit most when keeping you consistently buying a singular brand (i.e. theirs’) and upgrading to the latest versions of their hardware.
TPM providers, on the other hand, are in the customer satisfaction business. They’re focused on making their customers happy. However, they’re also backed by skilled technical resources who can support what OEMs deem unserviceable equipment under flexible contract arrangements.
A Closer Look at TPM Pricing
We know that choosing TPM can help you reduce OPEX spend and free up your budget for more strategic IT investments. But let’s dig a little deeper into TPM pricing.
The cost of TPM support depends on several factors, including:
- Equipment makes − for example, IBM, Cisco, Dell, etc…
- Model − this indicates if the asset is a server, storage, or network asset
- Configuration − the collection of parts that make up the complete system, such as CPUs, controllers, disk drives, SSDS, fans, and power supplies.
- SLA (Service-Level Agreement) − if the SLA is Next Business Day parts, parts can be shipped overnight versus a 4-hour SLA where parts may need to be purchased and stored on site.
- Location – for example, is the equipment located in Pennsylvania or India? There will be differences in the availability and current stocking levels of parts to support the contract.
- Number of assets under support
- Additional features − such as on-site spares and parts
What costs more to maintain and why?
Several hardware-related factors also influence TPM pricing:
- Storage devices such as Dell EMC, Pure, NetApp, and HDS are more expensive to support. That’s due to the sheer quantity of hard drives they feature, along with the cost of replacing controllers.
- Core network switches such as Cisco Catalyst and Cisco Nexus equipment and related parts are more costly when compared to smaller, standalone switches.
- Servers with SSD drives
- IBM Mainframe systems
- Large Unix servers from IBM, SUN Oracle, or Fujitsu
- Equipment with high-level SLAs (24x7x4) with on-site spares that require quick responses with the exact part
- Locations outside of the United States in Central and South America, the Middle East, and most island nations. That’s because taxes, clearing parts through customs, and finding the appropriate field engineers cost more when compared to North America, Asia, and Europe.
What costs less to maintain?
- Servers that are 3−10 years old with easily available parts
- Storage systems with older disk drive technology such as fiber channel, SAS, or SATA.
- Edge switches
- x86 servers
What to look out for when pricing your TPM contracts
- Parts availability: Look for a TPM partner that will tell you when your parts are scarce or not available, rather than simply taking on the contract in the hope that those parts won’t need replacing.
- Non-inclusion of software: Be aware that software updates aren’t included in TPM service contracts.
- Stocking parts for 24x7x4 contracts: Many TPM partners don’t stock parts for high SLA contracts or remote locations.
How do I get accurate pricing for TPM?
- Organize your assets, configurations, SLAs, locations, and terms.
- Identify which assets you could consolidate or co-terminate.
- Assess what is most suitable for TPM. For example, certain Cisco equipment currently has DNA licensing that isn’t ideal for TPM because parts are serialized and registered to the chassis.
- Review what value-added features − such as platforms or monitoring − might make your life easier.
How Can We Help?
Reliant Technology is trusted by over 3,100 businesses to deliver reliable, dedicated TPM support along with flexible contracts for Dell EMC, NetApp, HPE, Cisco, IBM, and more.
If you’re seeking ways to reduce maintenance costs and need help discovering your assets and analyzing which ones are ideal for TPM, we can assist. Why not download this spreadsheet to help you get organized? Alternatively, get in touch for a custom quote or to schedule a consultation.
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Reid is the founder and CEO of Reliant Technology and for 14 years has pursued his mission to remove the pain associated with maintaining IT infrastructure. Reid writes on common challenges related to maintaining, servicing, tracking, budgeting, and upgrading technology.
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About Reliant Technology
As Data Center and storage experts, Reliant Technology is available to provide consultations and solutions to your server backup needs. Our experienced engineers and IT specialists are ready to help you determine the best option for your Data Center. If you have a topic you would like to see discussed, or if you would like to submit an article for possible publication, please, get in touch with us.