What do SSDs and The Cloiud Have in Common

What do SSDs and the “Cloud” have in common?

This last week, April 18^th I read two different articles that have absolutely nothing to do with each other but are very interesting from an IT point of view for all concerned.

First an article sponsored by Toshiba and published by IDC talking about the state of Solid State Disk Drives (SSDs).  SSDs have been around since about 1996 but the development has only started to ramp up and finally see their way into laptops.  The article talks about the two different types of SSDs their importance and what the future holds.  I expect them to make a dramatic impact in the server and storage marketplace in the next five years as costs begin to tumble and reliability increases.

http://ssd.toshiba.com/images/IDC_ToshibaMLC_SSD.pdf

The second article from Information Week had to do with the government taking to the cloud to cut budget costs.  The article reveals that 29% of the agencies are using cloud computing and another 29% expect to get there in the next 12 months.

I suggest looking at the following links to see how the “Cloud” might be impact your business.

From Information Week – Government Technologist: Cloud Computing’s Hard Realities Set In - http://informationweek.com/news/government/cloud-saas/229401692?cid=nl_IW_week_2011-04-18_html

The second article talks about moving to the Cloud and what vendors are offering private clouds with tighter controls over the geographic location of data storage and other aspects of security.

From Information Week – Cloud’s Tipping Point - http://informationweek.com/news/government/cloud-saas/229401691?cid=nl_IW_week_2011-04-18_html

Average Equipment Discounts for 2010

DMC Valuations forecasted over 400 equipment assets in 2010 in a variety of categories.  Below are the discounts by category as well as the vendors in each category.  Specific discounts by vendor are available to subscribers to the DMC Advisory or DMC Consulting services.

Copiers
Vendors:

• Canon
• Konica Minolta
• Oce
• Ricoh
• Toshiba
• Xerox

Average discount off of MSRP: 44%
______

Forklifts
Vendors:

• Hyster
• Komatsu
• Nissan
• Toyota

Average discount off of MSRP: 11%

IT Desktops
Vendors:

• Dell
• HP

Average discount off of MSRP: 39%

IT Laptops
Vendors:

• Apple
• Dell
• Fujitsu
• HP
• Lenovo
• Panasonic

Average discount off of MSRP: 25%

IT Network
Vendors:

• Blue Tree
• Blue Coat
• Ciena
• Cisco
• Dell
• Enterasys
• F5
• Fat Pipe
• HP
• IBM
• Juniper
• Mitel
• Netscout
• Nortel
• Radware
• Riverbed

Average discount off of MSRP: 41%

IT Printers
Vendors:

• Epson
• HP
• Zebra

 Average discount off of MSRP: 30%

IT Servers
Vendors:

• Apple
• Cisco
• Citrix
• Dell
• HP
• IBM
• Sun

 Average discount off of MSRP: 33%

IT Storage
Vendors:

• Dell
• HP
• IBM

 Average discount off of MSRP: 40%

Mail Equipment
Vendors:

• Bell Howell 

Average discount off of MSRP: 11%

Medical Equipment
Vendors:

• Accuity
• Agilent
• Applied Biosystems
• CareFusion
• Cynosure
• Diomed
• Dionex
• GE
• Hitachi
• Hologic
• Kodak
• Magview
• Medtronic
• MyLab
• Olympus
• Positron
• ScottCare
• Siemens
• Storz
• Stryker
• Sysmex
• TIMS
• TomoTherapy
• Toshiba
• Varian
• Ventana
• Zen

 Average discount off of MSRP: 10%

Miscellaneous Equipment
Vendors:

• Acculogix
• APC
• Avaya
• BOSCH
• Burlodge
• Caterpillar
• Cencorp
• Chloride Power
• Cisco
• Delta
• Diagraph
• Eaton Electrovert
• HP
• Infoblox
• Keyence
• Kodak
• LeCroy
• LG
• McElroy
• Mettler Toledo
• Motorola
• NEC
• Plant CML
• Polycom
• PVA
• QUMU
• Sea Tel
• Shorephone
• SmartBoard
• Tandberg
• Taylor Dunn
• Tennant
• Toshiba
• Veriphone
• Vision
• Winegard
• YSLON
• Zeiss
• HP
• IBM

 Average discount off of MSRP: 75%

Discounts can vary from 0% to 60% and more on some assets.

Equipment Discounting - It can be costly if not reviewed

Have you ever considered what impact discounts on machinery and equipment can have on the back end of a lease?  If the lessee misses the opportunity to negotiate a good discount and misses by 10% from the marketplace, either the lessor or the owner of the equipment will lose money when it comes to remarketing the equipment.  If the example below the MSRP was $250,000 and the discount was offered was 24% while the rest of the marketplace was getting a 36% discount.  If you expected 15% residual at the end of the expected usage of the equipment at 36 months, as did other users in the same situation, you could potentially lose over $5,000 at 36 months.  If you continually miss the mark on the discounts it could mean the loss of substantial profits over the year.

Mfr List Price	Vendor Discount	Original Equipment Cost	Fair Market Value Forecast                 at                                     24 months	Fair Market Value    Forecast                      at                               36 months	Fair Market Value   Forecast                               at                                   48 Months
$250,000	24%	$    190,000	32%	18%	9%
		Forecasted Residual Value	$   60,800	$   34,200	$   17,100
$ 250,000	36%	$     160,000	32%	18%	9%
		Forecasted Residual Value	$   51,200	$   28,800	$   14,400
	Potential	Lost Profits	$     9,600	$     5,400	$     2,700

                        % of MSRP             3.8%           2.2%           1.1%

In another scenario that can have a devastating consequence is when the owner, lessee, or lessor purchases or finances equipment that has been on the market for a year or more and does not get the discount reflective of the current marketplace.  This happens more times than you would expect.  The user then assigns a residual value at the end of the expected usage time that is not reflective of the marketplace.  Due diligence of any asset acquisition by the owner, lessee and or lessor is a key element to maximizing the return on your investment.