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4-page Case Study - Posted 10/16/2012
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Cloud Hosting Provider Saves $156,000 in First Year with Operating System Upgrade

When SoftCom wanted to reduce the operational costs of its virtual private server business, it turned to the Windows Server 2012 operating system with Hyper-V. With the ease of deployment and simplified management of the Hyper-V environment, IT staff reduced administration labor by 40 hours per cluster. Windows Server 2012 is an agile and dynamic virtualization solution that data center staff use to provision virtual machines 25 percent more quickly than before and migrate virtual machines within a cluster seven times faster—with no downtime. IT staff also increased virtual machine density by more than 50 percent and reduced the data center footprint by 36 percent. SoftCom reduced hardware costs by US$156,000 within the first year of deployment and with fewer servers to administer, it will save $2,500 in annual utility costs and 1,000 hours—equating to $40,000 in annual IT labor costs.

Established in 1997, SoftCom began as a shared web hosting and email service provider focused primarily on the consumer and small-business markets. Its flagship brand, myhosting, provides domain registrations, web hosting, application hosting, website development, business email and collaboration, and complex, managed hosting solutions to consumers and small businesses worldwide. The company’s other major brand, mail2web, is a web-based email service offering both advertising-supported and subscription-based email services to more than 2.5 million users worldwide. SoftCom leases space in three, state-of-the-art Internet data centers in Canada and the United States.

* With Windows Server 2012, we can run more virtual machines with better performance using fewer physical resources. We’ll spend less money to be more agile and more competitive in the marketplace.” *

Dmitri Gaikovoi
Senior Architect, SoftCom

“We have a talented group of employees who are committed to a ‘customer first’ approach,” says Dmitri Gaikovoi, Senior Architect at SoftCom. “We deliver the hosting services that customers want at competitive prices through an uncompromising commitment to innovation. That means we are always looking for leading-edge software and hardware solutions for our data centers.”

According to SoftCom, the demand for hosting services is changing. Customers want more control over their own virtual environments and they expect more from their hosting service providers. “Customers expect that we have reliable, highly available solutions and that we offer more than traditional web hosting services. Customers want cloud services for running mission-critical applications, including trading software, gaming servers, and e-commerce applications,” says Gaikovoi. “To accommodate our customers’ demands, we are becoming more of a virtual private server hosting company.”

Beginning in 2008, SoftCom made progress with its virtual private server hosting business using the Windows Server 2008 operating system with Hyper-V virtualization technology in its data centers. However, the type of applications that it could host for customers was limited to the virtual machines’ computing power: each virtual machine could have a maximum of four virtual CPUs.

Over the years, the challenge of creating a virtualized environment that can adapt dynamically to changing customer demands and deliver IT solutions that are reliable and cost-effective put increasing pressure on SoftCom to improve efficiency and control costs. While the company had virtualized almost 95 percent of its servers, hosting 85 virtual machines on average, to continue to grow the business at minimal cost, SoftCom wanted to reduce its infrastructure even more.

“Increasing server consolidation by running more virtual machines on each host would introduce further hardware and power savings,” says Gaikovoi. ”Taking our virtualization plans to the next level, we could build fully isolated, multitenant environments and perhaps offer new and different services for our customers.”

SoftCom needed better tools to reduce the management workload at its data centers and free up time for IT staffers to focus on developing more innovative services. “There were still many manual tasks that we had to perform, especially involving virtual server provisioning,” says Gaikovoi. “For example, back in 2008 when Windows PowerShell for Hyper-V wasn’t available, it took me more than a month to develop code for provisioning virtual machines.”

Data center administrators did not have live migration capabilities between stand-alone servers so maintenance on these servers incurred downtime for customers. As a result, the company migrated virtual machines only when it absolutely had to. “It could cost up to half an hour of downtime to move virtual machines from one host to another,” says Gaikovoi. “We recognized the benefits in agility that we would gain if we could achieve more flexible workload placement. We just needed the right technologies to introduce high-availability, high-density, easily managed clusters to our data center.”

In May 2012, SoftCom had the opportunity to find out how the next version of Windows Server could help achieve its goals to better serve customers through more cost-effective, powerful virtualization technologies. The company joined the Rapid Deployment Program (RDP) for the Windows Server 2012 operating system. “The latest version of Hyper-V had enhancements that we could use to increase the density of virtual machines per server, and it offered efficient support tools to improve manageability,” says Gaikovoi. “We were eager to work with Microsoft and get our hands on the prerelease code.”

* Taking our virtualization plans to the next level, we could build fully isolated, multitenant environments and perhaps offer new and different services for our customers. *

Dmitri Gaikovoi
Senior Architect, SoftCom

SoftCom began by building a simple, 3-node cluster using the beta release of Windows Server 2012. IT staffers spent time working with the beta code to streamline the process of creating virtual machines—some 300 of them. After the release candidate code arrived in June 2012 and the company received the new Dell PowerEdge M620 blade servers that it had ordered for the RDP, IT staffers built a 16-node cluster in the Toronto data center.

“We used the knowledge acquired during the pilot phase to quickly create 2,000 virtual machines on this cluster,” says Gaikovoi. “On the physical side, we have 24 processors per node and we have up to eight virtual CPUs per virtual machine, with a total of 192 terabytes of memory available. The deployment was pretty seamless, but we had access to the Microsoft consultant assigned to us for the RDP if needed. I also used the Microsoft Connect site to talk to beta support engineers and they were very helpful.”

While IT staffers were building the 16-node cluster, they utilized the management functionality of the iDRAC 7 network interface card from Dell. This has its own processor, memory, and network connection so that SoftCom data center administrators can perform power management and other tasks through a web browser or command-line interface.

“We can manage, monitor, update, and deploy software to Dell servers without having to physically access the hardware, which expedites virtual machine creation,” says Gaikovoi. “For example, firmware updates can be scheduled from the blade chassis’ web user interface on all cluster nodes during maintenance. We also use BIOS [basic input/output system] profile functionality for configuring all cluster nodes in a consistent way. iDRAC is a crucial feature for our remote data centers.”

Gaikovoi expects that Dell will have an update to support iDRAC monitoring, updating, and inventorying functionality for Microsoft System Center 2012 Service Pack 1. SoftCom is participating in the Technology Adoption Program (TAP) for Microsoft System Center 2012 Service Pack 1 and is evaluating how the IT staff can use it to manage the compute, storage, and network elements of virtual private environments.

“As a hosting company, it’s really important to have a robust provisioning and management engine that will allow us to reliably create, control, and delete virtual machines and effectively provide services to our clients,” says Gaikovoi.

Windows Server 2012 and System Center 2012 are built to work together and come with similar licensing agreements that enable SoftCom to run, manage, and monitor unlimited number of virtual machines in their data centers.

SoftCom also expects to gain business value from the following new and improved features in Windows Server 2012:

  • Hyper-V Replica. SoftCom can use this feature, which provides a storage-agnostic and workload-agnostic solution that replicates virtual machines over IP-based networks, to create a disaster recovery site for customers.

  • Hyper-V Network Virtualization. By using this feature, IT staffers can save time when they isolate a customer’s network of virtual machines on a shared network at the data center. With Hyper-V Network Virtualization, network administrators won’t have to worry about changing a customer’s IP addresses to accommodate SoftCom data centers’ physical and topological restrictions.

  • Hyper-V live migration and storage migration. SoftCom can use these capabilities to move multiple running virtual machines and virtual hard disks between physical hosts or storage locations with no downtime. IT staffers can also take advantage of simultaneous live migration of many virtual machines to save time compared with manually migrating virtual machines from node to node.

  • Cluster-Aware Updating. This feature supports automatic updating of clustered servers with little or no loss in availability during the update process. SoftCom can use Cluster-Aware Updating to take one node of the cluster offline, install updates, restart, and bring the node back online—all with no disruption to the customer.

  • Windows PowerShell 3.0. IT staffers can use the new features in Windows PowerShell to automate many manual tasks in the data center. They can write repeatable, parallel, and interruptible workflows in a simplified syntax that is more like natural language.

  • Hyper-V Dynamic Memory. Dynamic Memory introduces a minimum memory setting that allows Hyper-V to reclaim unused memory from any virtual machine. “We can use Dynamic Memory to better utilize physical hardware,” says Gaikovoi. “It is one of the factors that enable us to increase the density of virtual machines on the physical host.”

Today, SoftCom is ready to accommodate any customer that requests a virtual private server running on Windows Server 2012 Hyper-V. “We are preparing Windows Server 2012 virtual private server offerings with a goal of transitioning to a standardized Windows Server 2012–based environment by the end of 2012,” says Gaikovoi.

By using Windows Server 2012, SoftCom will have a complete solution for its data centers to deliver the high-density and performance capabilities that it needs to drive new business and contain costs. "With Windows Server 2012, we can run more virtual machines with better performance using fewer physical resources. We’ll spend less money to be more agile and more competitive in the marketplace,” says Gaikovoi.

Reduced IT and Hardware Costs
SoftCom is using Windows Server 2012 to increase virtualization density from 85 virtual machines per host to between 125 and 150 virtual machines per host, increasing density on average by 50 to 60 percent. With the 16-node cluster already hosting more than 2,000 virtual machines, it has increased density from 85 to more than 130 virtual machines per node, avoiding a hardware cost of eight additional blade servers that equates to US$96,000 and reducing data center space required by 36 percent. As the company moves forward with its virtualization plans, these savings will increase.

* The latest version of Hyper-V had enhancements that we could use to increase the density of virtual machines per server, and it offered efficient support tools to improve manageability. *

Dmitri Gaikovoi
Senior Architect, SoftCom

“With Windows Server 2012 as the foundation for our high-density data center, we will avoid buying approximately five new servers a year, saving $60,000 annually in hardware costs,” says Gaikovoi. “Additional cost savings will come from decreased power costs. We spend approximately $500 per year, per server on power and data center floor space. However you add it up, we will be maximizing the value of our hardware as we accommodate expected growth in business.”

Thanks to improved server and data center management capabilities due to Hyper-V and System Center 2012, SoftCom also expects to save money in labor costs. “When we deploy Windows Server 2012 in production, we expect to reduce by 1,000 hours a year the amount of time that system administrators spend on server and data center management,” says Gaikovoi. “That equates to being able to devote $40,000 annually to IT projects of more strategic value.”

Automated Data Center Management
SoftCom IT staffers use Windows Server 2012 to increase server administration efficiency in the data center so they can devote time to developing better solutions for customers. By using Hyper-V Network Virtualization, IT staffers won’t be facing additional work when they add new customers. “With Network Virtualization, we can more quickly deliver the multitenant security and isolation that our customers want, while keeping the same IP address that they use in their own environments,” says Gaikovoi. “Hyper-V Network Virtualization creates a business opportunity for us to offer more enterprise-level solutions.”

IT staffers also have the tools that they need to automate manual tasks to improve administration of their high-density clusters. “Based on our live migration experience in the RDP, we can move virtual machines from node to node within a cluster up to seven times faster than before,” says Gaikovoi. “And we expect Cluster-Aware Updating to save up to a week of manual labor to update a 16-node cluster. Cluster-Aware Updating is critical to the business if we want to take our virtual private server solution to the next level of density and agility.”

And by using PowerShell 3.0, SoftCom IT staffers can automate many new tasks when managing large, high-density clusters. “Before, it was not too much work to go into a 3-node cluster and do something on each node, such as configure the network adaptors,” says Gaikovoi. “But with a 16-node cluster, you need a good management tool. Not only do you have to log on to each node, but you have to do the task consistently. If there is a mistake, it’s hard to isolate the node where it is occurring. With PowerShell, I was able to quickly set up all 16 nodes consistently, and I saved about a week of manual labor.”

Improved Business Agility and Service Offerings
SoftCom expects that Windows Server 2012 will become its foundation for all future virtualization plans. The company will benefit from increased data center efficiency and a more complete line of services to drive its private virtual server business. For example, SoftCom plans on offering new products and services based on Hyper-V Replica, including the ability to back up its customers’ on-premises Hyper-V environments to its data centers. And because Windows Server 2012 improves the scalability and performance of Hyper-V, with virtual machines now capable of accessing up to 64 virtual processors, SoftCom customers can more cost-effectively virtualize high-performance stock trading, media streaming, or gaming applications.

“We have reduced the time that it takes to provision a virtual machine by 25 percent, so we can add customers quickly and scale their virtual private server requirements up and down as needed. We have demonstrated live migrations with no downtime among nodes, and we have saved weeks of time building clusters. We have a vast number of PowerShell cmdlets to automate hundreds of manual tasks,” says Gaikovoi. “The many time-saving features of Windows Server 2012 translate into a more agile, responsive data center environment and better customer service. What could be better for business?”

Windows Server 2012
Windows Server drives many of the world’s largest data centers, empowers small businesses around the world, and delivers value to organizations of all sizes in between. Building on this legacy, Windows Server 2012 redefines the category, delivering hundreds of new features and enhancements that span virtualization, networking, storage, user experience, cloud computing, automation, and more. Simply put, Windows Server 2012 helps you transform your IT operations to reduce costs and deliver a whole new level of business value.

For more information, visit

For More Information
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For more information about SoftCom products and services, call (416) 957-7400 or visit the website at

Solution Overview

Organization Size: 130 employees

Organization Profile

Based in Toronto, Canada, SoftCom is a provider of web hosting, email, and business communications services worldwide through its family of Internet brands. It employs more than 110 people.

Business Situation

SoftCom wanted to accommodate customers’ requests for more services centered on isolated virtual servers. To do so, it needed to maximize virtual machine density, increase agility, and control costs.


The company is using the Windows Server 2012 operating system with Hyper-V virtualization technology to increase the level of density, mobility, and scalability of its multitenant environments.


  • Reduced IT and hardware costs
  • Automated data center management
  • Increased business agility and service offerings

  • Server: Dell PowerEdge M620
  • Out-of-Band Management: iDRAC 7 network interface card
  • Storage: NetApp FAS3240

Software and Services
  • Windows Server 2012
  • Microsoft Hyper-V
  • Microsoft System Center 2012

Vertical Industries
Hosters & ISPs

Country / Region

Business Needs
  • Cloud & Server Platform
  • Cost Containment

IT Issues
  • Virtualization
  • Cloud Services