2.2. CAPEX Minimization

2.2. CAPEX Minimization

The Capital Expenditures (CAPEX) associated with the network infrastructure alone constitutes about 10-15% of total data center expenditure (see [GREENBERG2009]). However, the absolute cost is significant, and hence there is a need to constantly drive down the cost of individual network elements. This can be accomplished in two ways:

• Unifying all network elements, preferably using the same hardware type or even the same device. This allows for volume pricing on bulk purchases and reduced maintenance and inventory costs.

• Driving costs down using competitive pressures, by introducing multiple network equipment vendors.

In order to allow for good vendor diversity, it is important to minimize the software feature requirements for the network elements. This strategy provides maximum flexibility of vendor equipment choices while enforcing interoperability using open standards.