4-page Case Study
Posted: 1/22/2010
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Tel Aviv Municipality Tel Aviv Municipality Enhances Flexibility and Reduces Costs with Virtualization

Governing the second-largest city in Israel, the Tel Aviv Municipality relies on a complex computing environment to provide a range of services for nearly 400,000 people. With more than 400 information systems installed on 250 servers, the municipality needed a way to meet its growing needs without deploying new physical servers, a process that often created significant delays and increased costs. Tel Aviv Municipality evaluated and then deployed the Windows Server 2008 operating system with Hyper-V virtualization technology to reduce costs, improve operational flexibility, and enhance its services. By virtualizing its server infrastructure with Hyper-V, the municipality built a more reliable and flexible computing environment, while reducing infrastructure costs by almost U.S.$2.1 million.



Tel Aviv is the second-largest city in Israel, with a population of 400,000 people. Located on Israel’s Mediterranean coast, Tel Aviv is a popular international tourist destination and a world economic center. The Tel Aviv Municipality is one of the largest entities in the Israeli economy, with 7,000 employees and an annual turnover of U.S.$1.3 billion.

To provide a range of services to many different population groups, the municipality relies on one of the most complex computer environments in the country, with 120 subsites and more than 400 information systems, including emergency, financial, personnel, geographic information, administrative, collection and charge, and pension systems. Approximately 3,500 municipal employees use these systems.

* Reducing the number of physical servers made it possible to reduce response time for network administrators, with a considerable improvement in the level of service to users. *
Itiel Maayan
Deputy Manager for Architecture, Computing Division, Tel Aviv Municipality
The information, storage, backup, and e-mail systems at Tel Aviv Municipality are installed on 250 servers running on the Windows 2000 Server, Windows Server 2003, and Windows Server 2008 operating systems. The number of systems—and users—is continually increasing, and as a result, the existing array of servers could not meet the municipality’s changing needs. But each time the municipality needed a new server, the IT department had to wait for a new budget year, often creating considerable delays in implementing computing projects that could streamline and improve the municipality’s services.

The municipality could not implement high-resource projects, such as customer relationship management (CRM) or business intelligence without new servers, and in some cases, delays resulted in significant and long-term financial implications. “The need to wait an entire year to purchase servers in the following budget year was very problematic,” says Itiel Maayan, Deputy Manager for Architecture in the Computing Division at Tel Aviv Municipality. “The situation was simply impossible. It was clear that finding an answer to this challenge could save a great deal of money, while also giving us the operational flexibility that we did not have.”

Additionally, analyses by network administrators at Tel Aviv Municipality revealed that the main processors often operated at only 15 to 20 percent efficiency, and memory was at 40 percent efficiency. To reduce costs, improve flexibility, and use its infrastructure more effectively, Tel Aviv Municipality needed to divide physical servers into a number of virtual servers that could operate alongside other virtual servers running on the same machine.


Tel Aviv Municipality examined several virtual solutions, including VMware and Microsoft virtualization technologies, evaluating factors such as licensing costs, routine maintenance costs, training costs, buying new licenses, total cost of ownership, the familiarity of personnel with the solutions, and assimilation time. The municipality also carried out an in-depth technology test to determine which solutions would provide good performance, maintain a large number of systems, and demonstrate reliability, availability, and growth capacity.

After performing the evaluations, Tel Aviv Municipality decided that the Hyper-V virtualization technology, a feature of the Windows Server 2008 operating system, would meet its needs better than VMware, and provide the best cost-benefit ratio. The municipality examined how parallel organizations in Israel—such as Hadassah Hospital, Clalit Health Services, Leumi Card, and the Ministry of the Interior—had used the Hyper-V solution and found it to be economically worthwhile.

Using Hyper-V, the municipality can run, on one physical server, a number of virtual servers that are simultaneous copies of the operating system. The municipality’s Computing Division identified 100 potential servers that could work on virtual servers and provide an improvement to the quality of service.  The division recommended focusing on 93 virtual servers to be installed on 14 physical servers. 

In 2009, the Computing Division began using Hyper-V to install new servers, successfully installing dozens of virtual servers on nine new physical servers that it purchased. The division experienced no particular issues, and the virtual server installations went very smoothly.


By virtualizing its server infrastructure with Hyper-V, Tel Aviv Municipality succeeded in finding answers to the challenges it faced, both at the technological and at the financial level. Its new systems work in a stable manner, with improved availability, performance, reliability, and operational flexibility.

“By virtualizing our infrastructure, we can remain a leader in technological innovation and in improving service to residents,” says Maayan. ”With Hyper-V, we upgraded our computing environment while producing a considerable savings in hardware and infrastructure costs to the organization.”

Reduced Costs

According to Avi Yanos, a Budget Auditor in the Budgets and Finance Division at Tel Aviv Municipality, the municipality saves money by reducing the number of physical servers it has to purchase, install, and maintain each year; by reducing electricity consumption for servers and for cooling the data center; and by purchasing fewer software licenses to maintain its server infrastructure.

* With Hyper-V, we upgraded our computing environment while producing a considerable savings in hardware and infrastructure costs to the organization. *
Itiel Maayan
Deputy Manager for Architecture, Computing Division, Tel Aviv Municipality
The Budgets and Finance Division has determined that the municipality will save U.S.$120,000 per year  between 2011 and 2014 by not having to purchase physical servers. With a smaller number of physical servers to maintain and manage, the municipality will save an additional $145,000 between 2010 and 2014.

The electricity consumption of the municipality’s 103 old physical servers cost an average of $60,000 a year. To power its new physical-server environment, Tel Aviv Municipality will only spend $5,000 in the first year. And because each watt consumed by a server generally requires another half-watt for cooling, the municipality will save even more electricity. In fact, by virtualizing its server environment with Hyper-V, Tel Aviv Municipality will reduce its electricity costs by more than $400,000 between 2010 and 2014. 

Additionally, the municipality will save no less than $1.25 million between 2010 and 2014 on the purchase and maintenance of controlling software, backup programs, and operating systems for physical servers. Yanos estimates that the overall savings from implementing Hyper-V will be almost $2.1 million, with a clear return on investment (ROI) in the first year.

Enhanced Flexibility

Network administrators will have fewer physical servers to manage, and they can now add new software systems to the environment without having to deploy new physical servers. And because administrators can easily transfer virtual servers between physical machines, they can respond quickly if a physical server fails, enhancing the reliability of the system.

“Reducing the number of physical servers made it possible to reduce response time for network administrators, with a considerable improvement in the level of service to users,” says Maayan.

The Hyper-V virtualization technology has helped the Computing Division to work more closely with the Budgets and Finance Division to provide even more savings from areas other than the computing budgets. “We’ve been able to use Hyper-V to bring value to the whole organization, in full cooperation with the entire echelon of decision makers, and with a clear and proven ROI,” Maayan says.

More Efficient Infrastructure

By virtualizing servers with Hyper-V, Tel Aviv Municipality has developed a more efficient computing infrastructure. For example, Tel Aviv Municipality saved storage space—the data center had been completely full, and the municipality would have needed additional storage space for new physical servers. And because the new infrastructure consumes so much less electricity, Tel Aviv Municipality can move toward more environmentally responsible computing.

“Our building is 50 years old, and we had reached a dead-end regarding power, cooling, and space,” says Maayan. “By moving to Hyper-V, we’ve enabled 20 more years of IT services, while implementing many new services, such as ERP and CRM.”

With Hyper-V virtualization technology, Tel Aviv Municipality has operating systems that work in a uniform Microsoft environment. This uniform environment also presented an easy learning curve for network administrators because they could take advantage of their familiarity with Microsoft technologies.

Windows Server 2008 with Hyper-V supports a 64-bit system, so the municipality can take greater advantage of the capabilities of the host servers, such as the use of quad processors and increased volumes of memory characteristic of the new servers.

Microsoft Virtualization
Microsoft virtualization is an end-to-end strategy that can profoundly affect nearly every aspect of the IT infrastructure management lifecycle. It can drive greater efficiencies, flexibility, and cost effectiveness throughout your organization. From accelerating application deployments; to ensuring systems, applications, and data are always available; to taking the hassle out of rebuilding and shutting down servers and desktops for testing and development; to reducing risk, slashing costs, and improving the agility of your entire environment—virtualization has the power to transform your infrastructure, from the data center to the desktop.

For more information about Microsoft virtualization solutions, go to:


For More Information

For more information about Microsoft products and services, call the Microsoft Sales Information Center at (800) 426-9400. In Canada, call the Microsoft Canada Information Centre at (877) 568-2495. Customers in the United States and Canada who are deaf or hard-of-hearing can reach Microsoft text telephone (TTY/TDD) services at (800) 892-5234. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary. To access information using the World Wide Web, go to:

For more information about Tel Aviv Municipality products and services, visit the Web site at:

Solution Overview

Organization Size: 7000 employees

Organization Profile

Tel Aviv Municipality governs Israel’s second largest city, providing services for 400,000 constituents. The municipality employs 7,000 people and manages an annual budget of U.S.$1.3 billion.

Business Situation

To meet its changing needs, Tel Aviv Municipality needed to reduce IT costs, improve operational flexibility, and use its server infrastructure more effectively.


After a thorough evaluation, Tel Aviv Municipality used Windows Server 2008 with Hyper-V technology to deploy a number of virtual servers running alongside other virtual servers on a single physical machine.

  • Reduced costs by almost U.S.$2.1 million
  • Enhanced flexibility
  • More efficient infrastructure

Software and Services
  • Windows Server 2008 R2 Enterprise
  • Microsoft Hyper-V

Vertical Industries


Business Need
  • Cloud & Server Platform
  • Cost Containment

IT Issue