Intel moves to consolidate 133 data centers

IT manager talks up benefits, but anonymous worker blogs about the pain of layoffs

An IT manager at Intel says that the company wants to run its data centers "like an Intel factory," a strategy that includes a plan to consolidate 133 existing IT facilities into eight data center hubs.

Intel currently has about 93,000 servers -- more than one for every employee. And many of them are based on single-core processors, according to Brently Davis, manager of the company's data center efficiency initiative.

Davis outlined Intel's data center consolidation strategy in a short blog posting and an accompanying video in which he responded to questions asked by someone who was outside of the camera's view. In response to some of the answers, the person asking the questions sprinkled in a couple of superlatives, such as, "Wow, that's amazing."

"Like most other companies these days, Intel is facing a growing demand for computing resources," Davis wrote in his blog posting. "As a result, our computing costs are going up along with that demand. All of these issues prompted us to take a hard look at our data center strategy to see where we could make it more efficient."

As part of the consolidation effort, Intel wants to increasingly move to servers with multicore processors as well as server virtualization software, Davis said in the video. Instead of running one operating system per server, the company wants to put four operating systems on individual machines, he added.

Davis said the consolidation moves may result in as much as US$1.8 billion in cost savings for Intel over the next seven years. It is expected to take that long to fully implement the efficiency program, he said, although he added that the company hopes to accelerate the process and complete the work by 2010 or 2011.

Data center consolidation has become a mainstream trend within IT departments, including the ones at major technology vendors. For instance, Hewlett-Packard Co. has been reducing 85 data centers located worldwide into six major facilities, all in the U.S., under a consolidation plan announced two years ago.

If Intel did nothing, its server count would continue to rise and might reach 250,000 systems at some point, Davis said.

Intel is probably in the middle of pack among large IT vendors in embarking on such a consolidation program, said Jonathan Eunice, an analyst at Illuminata.

Eunice said companies have found that they can make dramatic savings through data center consolidation, which typically also involves consolidating applications and other software programs to ensure that different systems are running on the same versions of products and have the same patch levels. Consolidation also enables IT departments to move off of legacy hardware and applications to "a more modern foundation," he said.

While blogging by company officials is giving businesses a new way of reaching customers and the media, it's also arming some of their employees with a means of communicating anonymously with the outside world.

In Intel's case, a blogger who calls himself Intel IT Guy has been using his Intel Perspective Blog to detail the impact of ongoing cutbacks within the company's IT department.

Anonymous blogs are potentially fraught with credibility issues. But when Intel IT Guy described the layoff process in a September posting, an Intel spokesman confirmed that cuts were being made and said that the company intends to reduce its IT staff by as much as 10%.

In his most recent blog entry, posted on Wednesday, Intel IT Guy described IT workers at the company as "angry, frustrated, buried in work and looking for some leadership. And after worrying about keeping their jobs for three months, they now have to figure out how to try and keep the infrastructure from falling apart."

The blogger also criticized Intel's management for not having a concrete operating plan to follow the workforce reductions. "We need a vision, a strategy and a plan that shows where we're going and how we're going to get there," he wrote. "Resource reductions are an action, not a vision. They're a consequence, not a plan."

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