South Africa South Africa City of Cape Town
Private Cloud Project Leads to Lower Server Footprint and US$595,000 Savings
Saturday, April 07, 2012
South Africa

"By implementing a private cloud and replacing 150 physical servers with six virtualized physical servers, we saved about US$595,000 or 66.5% in capital expenditures. That is huge savings."

Douglas Gelderbloem, Infrastructure Manager-ICT Department, City of Cape Town

The City of Cape Town, South Africa’s second most populous city, maintains two data centers that are used by its departments. In 2011, 150 of the city’s 350 physical servers were reaching the end of their lives, posing a risk to the delivery of city services. The city considered whether to maintain its old servers, replace them with new ones or implement a private cloud solution that used virtualization technology. Its decision rested on the adoption of a robust, integrated solution that was cost effective, efficient, highly automated and highly available.

The city turned to Microsoft, developed a private cloud solution using Microsoft Windows Server 2008 R2 Hyper-V and Microsoft System Center and consolidated 150 servers into six virtualized servers. As a result, the city realized huge savings, improved business agility, optimized resources, enhanced operational efficiency, and strengthened business continuity.

Business Needs

The City of Cape Town, with a population of 3.5 million, is the second most populous city in South Africa. It is also the legislative capital, seat of the National Parliament and second main economic center of the country. The city’s local government employs over 25,000 employees. A pleasant climate, natural beauty, and advanced infrastructure make the City of Cape Town the most popular international tourist destination in South Africa.

As part of its IT infrastructure, the City of Cape Town maintains two data centers that are used by numerous city departments providing key services such as health, social security, water, sanitation, police, transport, library, clinics, mayor’s office and city councilors. Aside from hosting a number of business applications and systems, the data centers store critical data for the city’s financial systems, human resources, geographic information services, SAP and Microsoft technologies, including Microsoft emails. "The data centers in the City of Cape Town store critical data and house all the city government’s digitized processes; if the data centers go down, the city can come to a standstill," said Douglas Gelderbloem, Infrastructure Manager- IS & T Department of the City of Cape Town.

The two data centers are part of the city’s two-data center strategy involving production and disaster recovery systems. If the production system in one of the data centers were to fail, the disaster recovery system in the other would automatically kick in as a production system to provide operational continuity. This redundancy, however, is true only for the city government’s corporate systems. There is no redundancy for the city’s smaller, one-off systems. In these systems, if the data center goes down, the business applications that they host would not run. A new server, in this case, would have to be provisioned and backups restored – signifying delays and potentially causing problems with the delivery of city services.

As of 2011, the city’s two data centers ran on 350 Wintel servers; of these, 150 were reaching the end of their lives. "Failing to replace or upgrade the 150 old servers," said Ghulam Brey, the city’s Head of Enterprise Operating Systems, "represented a risk to the city’s ability to deliver basic services; the chances of hardware failure and data loss are high. We had to come up with a plan, especially in relation to the smaller systems without redundancies or disaster recovery mechanisms."

"So what we did," said Douglas, "was to search for an integrated solution that was robust. We did a costing exercise to determine whether it made more sense to maintain those 150 servers or replace them with new ones. We also looked at costs for system license upgrades and costs of maintaining 150 new physical servers. We examined as well the costs of implementing a private cloud solution in which servers would be virtualized and hosted in fewer physical servers using virtualization technology."

"Our other consideration was that a new server infrastructure had to be cost effective, efficient, and provide a level of automation in terms of systems provisioning and patching," added Ghulam. "We wanted to avoid the complexity of managing 150 physical servers," he said.


As far back as 2000 when seven municipalities in Cape Town which used different operating systems for their computers, were first amalgamated into one city – the City of Cape Town, a strategic decision had been made by the city to go forward with Microsoft technologies. "It made financial and technical sense at that time to choose Microsoft," said Douglas. "We did a comparison between what we had and what we needed for the future. It was clear that working with Microsoft long term was the best option. And we have been with Microsoft since and used Microsoft a lot."

"For twelve years now, we have been using Microsoft technologies: Microsoft Office, Microsoft Exchange and Microsoft SharePoint," explained Ghulam. "Through the years, we have also been using Microsoft Windows Server 2003, Microsoft Windows Server 2008, Hyper-V and Microsoft System Center Configuration Manager."

Microsoft’s leadership in server and desktop environments further swayed the city’s choice towards Microsoft. "Microsoft is one of the biggest players in the server and desktop environments; those are the environments we wanted addressed," said Ghulam. "We wanted a total package integration of server and desktop environments, which Microsoft could provide. Microsoft also has the support infrastructure, so that if there are problems with Microsoft technology, there is always Microsoft staff we can rely on," he added.

Yet, the city had to be convinced that any solution from Microsoft addressed both financial and technical aspects. Ghulam said, "We felt that if Microsoft was unable to sufficiently meet all our requirements, then we would be prepared to step outside of our strategic relationship with them and explore other vendors." Microsoft, however, had just the technology the city needed: Microsoft Windows Server 2008 R2 Hyper-V. Douglas added, "The Hyper-V technology was new. Its principle involving the integration of solutions and maximization of resources was appealing. We were also convinced that a private cloud, which combined automation, control and resource management with a well defined topology of Windows certified servers, storage and networking hardware, was what we needed."

For the project implementation, the city turned to Microsoft Consulting Services South Africa (Izak Laubscher, Lead Consultant; Edward Wilson, Consultant; and Cassandra Barbosa, Project Manager). "We decided to go for Microsoft Consulting Services in implementing this project. We realized that we needed their expertise. The private cloud solution was deployed as black box," said Ghulam. "The project," said Tapuwa Machiri, Microsoft Account Technology Strategist," involved implementing a private cloud solution in which 150 Wintel servers would be consolidated into just six virtualized physical servers. For this, we needed Microsoft Windows Server 2008 R2 Hyper-V."

"The six hosts, currently in the city’s private cloud infrastructure, form part of a resource pool that could be upgraded with more virtual hardware should the City of Cape Town decide to build its data center capabilities further," said Izak Laubscher, Microsoft Services Datacenter Consultant.

At the heart of the virtualization project is Microsoft System Center with its various components, including Microsoft System Center Operations Manager, Microsoft System Center Configuration Manager, Microsoft System Center Orchestrator, Microsoft System Center Service Manager and Microsoft System Center Virtual Machine Manager. "The Microsoft System Center stack is hosted on two additional virtualized servers constituting the ‘fabric management’ layer," added Izak.

"The integration of various Microsoft technologies as a complete solution was important. You remove one of them from the black box and a key functionality will disappear or be degraded," said Godfrey Voegt, Microsoft Account Manager for provincial and local governments.


By implementing the private cloud project and consolidating 150 servers into six virtualized machines, the City of Cape Town realized a savings of US$595,000 in capital expenditures. In addition, the integration of Microsoft technologies as a complete solution in the city’s private cloud project led to a reduction in operating costs, improvement in business agility, optimization of resources, operational efficiency, enhanced resource-use visibility, and business continuity and resiliency. The success of the project seems to have also inspired the provincial administration of Western Cape to implement a similar project with the help of Microsoft Consulting Service South Africa.

US$595,000 Savings in Capital Expenditures

"We estimated costs of maintaining our system, replacing the old physical servers and upgrading their licenses at about US$895,000. By implementing a private cloud solution and replacing 150 physical servers with six virtualized physical servers we project a savings of about US$595,000 or 66.5% in capital expenditures. That is huge savings," said Douglas.

Reduction in Operating Costs

"In addition, by reducing our server footprint from 150 to just six, we reaped substantial savings in operating expenses. The maintenance costs, in terms of system administrators, IT staff, air-conditioning, power use and space requirements, are much lower," said Ghulam. "We also have less carbon footprint, contributing to a greener IT infrastructure," he added.

Improvement in Business Agility

Before the creation of a private cloud, the city would take one week to three weeks to provision a server and get applications up and running. There could also be further delays with the procurement and delivery processes. "With the private cloud in place, we can now provision our application servers much faster. What took weeks could now be done in hours. That is real quick," said Douglas. "When you consider that the data center is essential to the ability of city departments to deliver basic services, quick provisioning represents a huge improvement in business agility. Instead of our data center being potentially liable for the disruption in the delivery of city services upon the systemic failure of old hardware, it has now become a strategic asset for responding quickly to public need," he added.

Optimization of Resources

As part of public accountability, the City of Cape Town aims to maximize the return on its investments. However, it failed in the past to optimize the use of its data center resources, some of whose physical servers were often idling or underutilized. "Today, having multiple virtual machines running on one physical server that dynamically shares resources and cohosts multiple applications represents a significant optimization of resources," said Douglas.

Operational Efficiency

A number of the data center’s processes such as server provisioning, system management and system monitoring used to rely heavily on IT staff intervention. "With the tools for self-service and automated provisioning, system management and monitoring now in place in our private cloud, we achieve greater operational efficiency as we deploy our IT staff to deal with other key processes," said Ghulam.

Enhanced Resource-Use Visibility

The private cloud solution tracks and measures usage of computing facilities. "This capability enhances the visibility of computing resources usage so that the city can plan for its computing requirements and put a tangible value to services that it offers," said Douglas. "We also have the option to develop the data center into a strategic business center and potentially charge back city departments for their computer use. Although this is a potential benefit, we have not moved towards that direction yet," he added.

Business Continuity and Resiliency

"The implementation of a private cloud prevents a disruption in data center services and ensures business continuity," said Douglas. "Even if we experienced hardware failure or had to do routine maintenance on our servers, the fact that resources can be dynamically migrated from one virtual server to another means that there is no downtime required and data center services run smoothly and continuously. This type of data center infrastructure obviously provides resiliency for our business processes," he continued.

This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.
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