ServerBeach, a dedicated hosting firm that operates several U.S.-based data centers, has spent years building its own 1- or 2-way white box servers using AMD processors. Recently, the company, a business unit of PEER 1 Network Enterprises, added Dell PowerEdge servers to its lineup.
After years of building its own servers, the hosting provider found itself wading in deeper waters with bigger fish swimming around. To attract these larger customers, ServerBeach added 1,000 Dell PowerEdge SC430 servers to its operations.
“We were losing more and more bigger deals by not having a branded offering,” says ServerBeach Chief Operating Officer (COO) Robert Miggins, “By adding Dell’s PowerEdge servers, we have been able to expand our business. These servers are easier to manage and have very low hardware failure rates.”
Within the past six months, the company added almost 1,000 Dell PowerEdge SC430 servers to its operations. The servers have either an Intel Pentium 4 processor or a Pentium-D (dual-core) processor.
Founded in 2002, ServerBeach is self-managed hosting provider. As such, it supports the networks, server hardware, and operating systems. Customers, on the other hand, support the applications — with assistance from ServerBeach’s support team. The offering is aimed at technically proficient individuals (read: geeks) in the small-to-midsize business marketplace. This includes plenty of resellers, e-commerce providers, and applications service providers (ASPs). These performance-hungry and Web-savvy individuals demand basic, yet powerful machines for functions like e-mail, software development, photo galleries, and gaming. As a result, these clients tend to want to manage their machines themselves.
Enter ServerBeach, which focuses on offering quality hardware on a reliable network (the company has a 99.99 percent uptime guarantee) at an affordable price.
“We focus on the geek and offer servers that are built by geeks, for geeks,” says Miggins.
The firm is listed as one of the Top 15 host companies in North America per TopHost.com. It runs three data centers, which are located in Los Angeles, Calif. (500 servers), San Antonio, Texas (2,000 servers), and Herndon, Virg. (4,500 servers). Most are white boxes advertised under the company’s “PowerLine” moniker. Parts for these machines are ordered from various component vendors, shipped onsite, and assembled by ServerBeach staff. To keep assembly and management simple, the company limited its servers to a few specific configurations: a couple of different hardware variations and a choice of Windows (2000 or 2003) or various Linux flavors (Debian, Red Hat or CentOS). About 60 percent of its 7,000 servers use Linux.
On the processor side, the company has always favored AMD. More recently, it added the 64-bit Athlon64 chip.
“We buy the components and do the assembly ourselves, which lowers costs,” says Miggins. “AMD fit in well within that way of operating.”
About a year and a half ago, however, ServerBeach noticed a change in the market. Perhaps as a result of its own growth, it began receiving more inquiries from larger firms. Unlike its traditional clientele, this represented a much more risk-averse audience. Consequently, these new customers demanded branded hardware.
“Bigger deals were frequently being lost due to not having a branded server offering using Intel processors,” says Miggins.
According to Miggins, Dell and HP were the two options seriously considered. Dell came out on top due to a number of factors, not least of which, ServerBeach already had a relationship with Dell. Although ServerBeach was selling exclusively PowerLine servers to customers, the company had been using PowerEdge servers internally for various functions.
Further, Miggins found the level of responsiveness to be higher from Dell. He gives the example of a request to integrate Dell hardware with proprietary technology called RapidReboot. This enables instant rebooting of servers remotely, a feature attractive to many customer, as they don’t have to call tech support or open a trouble ticket. Instead of waiting for someone else to intervene, they can reboot the server from their own console with one click.
Using RapidReboot, however, required a hardware modification, and ServerBeach technicians wondered if it would even work on branded models. Fortunately, they resolved this issue rapidly and easily with the help of Dell tech support.
The almost 1,000 Dells now in use at the various data centers represent about half of the servers the company has sold in the past few months. Two-thirds are PowerEdge SC430’s using Pentium 4 processors. The rest are SC430’s with Pentium-D dual-core processors.
“Because we have such volume, we try to limit the server flavors out there,” says Miggins.
Paying a Premium
Miggins reports the servers are performing very well and are popular with customers. Its technicians are all Dell-certified so as to be able to support the servers internally.
“In our line of business, hardware reliability must be rock solid, with no major stumbling blocks,” says Miggins. “The performance of our Intel chips and PowerEdge servers has been excellent to date.”
Those requesting the Dell systems pay more for the privilege than do ServerBeach customers using the AMD-based PowerLine models. However, as this newer customer segment is generally representative of more mature businesses operating on higher costs, they are willing to pay a premium of about 15 percent to obtain the brand.
“People come to us specifically demanding Intel, due perhaps to the way their applications have been designed,” says Miggins. “Alternatively, they have a personal affinity for Dell or Intel and are happy to pay extra to receive the brand.”
Miggins also notes that high-performance customers using processor-intensive applications much prefer the dual-core version of the SC430 despite its 25 percent higher price. The reason, he says, boils down to simple mathematics. In effect, the Pentium-D provides almost double the performance for only a quarter of the price, while taking up half the room.
Even in such a geek-rich environment, the company is finding broad acceptance of the Dell systems due to their ease of management. The technicians like them, as they seem to be more stable. In effect, they have discovered that there is far more room for error in the servers they assemble internally. A bad batch of memory, for example, can affect a large number of servers and impair service delivery until detected. Such problems haven’t happened so far with the PowerEdge boxes.
“The Dells are hard to argue against due to their performance and stability,” says Miggins. “Even though people can have deep-seated preferences, they can see their value.”
As a result, the company changed the hardware aspect of its service-level agreement contracts (SLA) for the new boxes. With its PowerLine servers, ServerBeach has a hardware replacement guarantee of 12 hours for massive hardware failure, although it tries to handle it sooner. The new Dell models, on the other hand, have a reduced SLA time &3151 down to only eight hours as a hardware guarantee. Reason: As failures happen much less frequently, the company is confident of its ability to easily make the new SLA.
The hosting firm plans to add PowerEdge servers with more powerful processors during the next few months. It plans to do that, however, while still maintaining its policy of only having a couple of basic Dell models to cover all its needs.
“Although we plan to upgrade soon to a more powerful processor, we try to make as few changes as possible,” says Miggins.