Energy Trader Boosts Virtualization Density by 50 Percent with Software Upgrade

OverviewCountry or Region: United KingdomIndustry: Energy trading

Customer ProfileGazprom Marketing and Trading (GM&T) is an energy trading company headquartered in London, England. It is a subsidiary of Gazprom, the world’s largest natural gas producer.

Business SituationGM&T needed to find a faster and more cost-effective way to deliver servers to the business. It had used VMware but wanted to revisit the best way to support rapid growth.

SolutionGM&T switched to Windows Server 2008 R2 Datacenter with Service Pack 1 and used Hyper-V technology to create 64 host servers with the capacity for 750 virtual machines.

Benefits Virtualization density increased by 50

percent Cost avoidance of nearly £4.4 million Faster delivery of servers Increased server availability

“With Dynamic Memory, we’re seeing a 50 percent reduction in memory needs, avoiding up to £120,000 in memory costs and enabling us to increase our virtual machine density by 50 percent.”Ian Burgess, Head of Global Technical Infrastructure, Gazprom Marketing and Trading

Gazprom Marketing and Trading (GM&T) is the energy trading arm of Gazprom, the world’s largest producer of natural gas. With an ambitious growth strategy and energy markets opening up globally, GM&T needed to find a faster and more cost-effective way to deliver IT resources to the business. It switched from VMware to Windows Server 2008 R2 with Hyper-V technology and recently upgraded to Windows Server 2008 R2 with Service Pack 1. By using the Dynamic Memory feature in that release, it can increase virtual machine density by 50 percent and boost the number of virtual machines on its host-server infrastructure from 500 to 750. GM&T also realized a cost avoidance of nearly £4.4 million (U.S.$7.2 million) on servers, electricity, and real estate. The IT staff can deliver servers in minutes rather than weeks, and service availability is higher with automated memory management.

SituationGazprom Marketing and Trading (GM&T) is an energy trading company and a subsidiary of Gazprom, the world’s largest producer of natural gas and the largest company in Russia. GM&T is based in London and has 600 employees, who work out of offices in the United States, Europe, and Asia. Its traded commodities include natural gas, liquefied natural gas, electricity, and carbon credits.

With global energy markets becoming more liberalized and GM&T adopting an ambitious growth strategy across all its products and geographies, the company has experienced massive growth in terms of profitability and staff. More people, opportunities, and markets have meant more demand for IT systems. During 2010, GM&T implemented new trading and infrastructure systems, and business groups needed prompt access to new servers to get new applications and services up and running quickly.

“When I joined the company in late 2009, the GM&T IT infrastructure was splitting at the seams,” says Ian Burgess, Head of Global Technical Infrastructure for Gazprom Marketing and Trading. “We had servers spilling out of the data center and simply could not fit any more into our space.” Most servers ran the older Windows Server 2003 operating system.

Burgess knew that he needed to gain control of runaway server proliferation and related costs. He also needed to accelerate server deployment and delivery. Server virtualization could meet both objectives.

Prior to Burgess’s arrival, the IT staff had used VMware ESX server to virtualize about 50 test, development, and production servers. However, with the company entering a new phase of growth, Burgess wanted to revisit how IT could quickly provide scalable development and production environments to support growth-supporting IT projects. He was eager to introduce the company to the Hyper-V virtualization feature in Windows Server 2008 R2. “I had extensive experience with Hyper-V from a previous role and knew that it was a much more cost-effective virtualization option and would let us support our growth more economically,” Burgess says.

In the first quarter of 2010, GM&T began upgrading its servers to Windows Server 2008 R2 and transitioning its VMware environment to Hyper-V. Expanding its use of virtualization helped the IT staff meet the intense demand for servers. “We’re under a lot of pressure to deploy new test, development, and production environments very quickly,” Burgess says. “Over the last year, we built hundreds of these environments to enable our development teams to develop and test new applications.”

Even with its expanded use of virtualization, GM&T was not able to achieve the virtual machine densities—the ratio of virtual machines to physical host server—that it desired. “Most of our virtual machines are memory hungry, and we had to limit the number of virtual machines that we deployed on each host so that there would be enough memory for them,” Burgess says. “Consequently, we were still buying more hardware than we wanted.”

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“Most of our virtual machines are memory hungry, and we had to limit the number of virtual machines that we deployed on each host so that there would be enough memory for them.”Ian Burgess, Head of Global Technical Infrastructure, Gazprom Marketing and Trading

SolutionBurgess was familiar with the Dynamic Memory feature in Windows Server 2008 R2 with Service Pack 1 (SP1), which allows memory on a host server to be pooled and dynamically distributed to virtual machines based on workload demand. This provides more consistency in system performance and easier management of virtualized server resources.

Dense Virtualized ClustersBy then, GM&T had used Hyper-V technology to create 64 host servers, which it upgraded to Windows Server 2008 R2 Datacenter with SP1. Those 64 hosts are configured as 11 clusters, ranging from 2 to 16 nodes. Across the 64 hosts, GM&T created approximately 550 virtual machines. With Dynamic Memory, GM&T will be able to boost the number of virtual machines to about 750. Today, GM&T has completely eliminated VMware from its infrastructure, and runs a wide range of workloads on Hyper-V, including Microsoft SharePoint Server 2010, Microsoft Exchange Server 2010, Microsoft SQL Server 2008 R2 data management software, Microsoft Lync Server 2010, Microsoft System Center data center solutions, SAP, critical trading applications, file services, and infrastructure services.

GM&T uses Dell PowerEdge R610 and R910 servers for its virtualization infrastructure. “Dell and Microsoft work closely together to ensure that their hardware and software perform well together,” Burgess says.

Management Efficiencies Leading to Private Cloud

GM&T is working to convert its virtualized infrastructure to a private cloud, whereby the host server processors, memory, and storage are dynamically available to, and adjusted across, all virtual machines in the infrastructure. The company lacks only a mechanism for enabling on-demand provisioning of virtual machines. “We are looking forward to creating this self-service tool when we upgrade to Microsoft System Center Virtual Machine Manager 2012,” Burgess says. “This will enable business users to provision their own servers without going through the IT staff.”GM&T already uses Microsoft System Center Virtual Machine Manager 2008 R2 to create and manage virtual machines using automated templates and wizards. The IT staff uses the program console to centrally manage all physical and virtual assets, monitor server and site performance, troubleshoot problems, and handle all other server management tasks.

Licensing EfficienciesSystem Center Virtual Machine Manager is part of the family of Microsoft System Center data center solutions, which includes a range of infrastructure management solutions. GM&T licensed Microsoft System Center Server Management Suite Enterprise, which provides an economical way to obtain server management licenses for the four main System Center products—Microsoft System Center Operations Manager 2007 R2, Microsoft System Center Configuration Manager 2007 R2, Microsoft System Center Data Protection Manager 2010, and Microsoft System Center Virtual Machine Manager 2008 R2.

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“The value proposition of Microsoft licensing is amazing,” Burgess says. “We are using all the System Center tools anyway, and this licensing package delivers significant savings to us. Plus, I believe in the ‘better together’ value proposition—that it makes sense to use Microsoft tools to manage Microsoft workloads.”

GM&T uses System Center Configuration Manager to deploy software and security updates to both physical and virtual servers and to client PCs. It uses System Center Operations Manager to monitor physical and virtual servers, and it uses System Center Data Protection Manager to back up workloads on its virtual and physical servers to disk throughout the day.

BenefitsBy upgrading to Windows Server 2008 R2 with SP1, Gazprom Marketing and Trading has been able to increase its virtualization density. By virtualizing with Hyper-V, the company has been able to avoid server-related expenses, deliver IT services faster, and improve server availability.

Virtualization Density Increased by 50 PercentBy using Dynamic Memory in Windows Server, GM&T has been able to increase its virtual machine density. “With Dynamic Memory, we’re seeing a 50 percent reduction in memory needs, avoiding up to £120,000 in memory costs and enabling us to increase our virtual machine density by 50 percent,” Burgess says. “The host server infrastructure that before held 550 virtual machines will soon hold 750 virtual machines. We’ll be able to postpone buying more servers for six months.”

Cost Avoidance of Nearly £4.4 Million In fact, without Hyper-V, GM&T would have had to spend millions of pounds acquiring, powering, and housing 750 physical servers. Burgess estimates the cost to purchase 750 physical servers at £3 million (U.S.$4.9 million) and the cost to power them at £368,000 (U.S.$600,000) annually. “By using Hyper-V, we were also able to delay our migration into our new data center by a year, resulting in a savings of £1 million [U.S.$1.6 million],” Burgess says.

Faster Delivery of Servers to the BusinessWith its expanded use of virtualization, the IT staff at GM&T is better able to respond to business needs. “It takes minutes to deploy a virtual machine versus days or weeks to deploy a physical server, especially if we need to order it first,” Burgess says. “By using Hyper-V, we are able to meet the needs of our business users much sooner and make far better use of our busy IT staff.”

Another benefit of Dynamic Memory is a reduction in memory management work. “When we fail over a virtual machine from one host to another, we need to make sure that the new host has enough memory,” Burgess says. “My staff used to have to manage memory usage manually, but Dynamic Memory automates this job, allowing virtual machine memory to grow and shrink dynamically.”

Increased Server Availability and Employee ProductivityHigher availability is another benefit related to improved memory management. Previously, when the IT staff manually managed virtual machine memory, there was a high likelihood that a virtual machine

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“The value proposition of Microsoft licensing is amazing. We are using all the System Center tools anyway, and this licensing package delivers significant savings to us.”Ian Burgess, Head of Global Technical Infrastructure, Gazprom Marketing and Trading

“By using Hyper-V, we are able to meet the needs of our business users much sooner and make far better use of our busy IT staff.”Ian Burgess, Head of Global Technical Infrastructure, Gazprom Marketing and Trading

would not be able to successfully switch over to a new host server because of memory limitations, causing the virtual machine to fail. Today, GM&T has eliminated these memory-related failures.

“We’re a worldwide, around-the-clock business with people relying on our systems every minute of the day,” Burgess says. “Our development staff is located all over the world. All our development and production systems need to be up all the time. Improved virtual machine availability, made possible by Windows Server 2008 R2 with SP1, helps employees stay productive around the clock. As a trading company, we don’t have many physical assets. Our primary assets are our IT systems. If I can guarantee that they are running faster and more availably, we enable the business to be more successful.”

Windows Server 2008 R2Windows Server 2008 R2 is the latest version of the Windows Server operating system from Microsoft. With Windows Server 2008 R2, you can create solutions that are easier to plan, deploy, and manage than with previous versions of Windows Server. Building on the features, security, reliability, and performance provided by Windows Server 2008, Windows Server 2008 R2 extends connectivity and control

to local and remote resources. This means that your organization can benefit from reduced costs and increased efficiencies gained through enhanced management and control over resources across the enterprise.

For more information, go towww.microsoft.com/WindowsServer2008R2

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For More InformationFor 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 who are deaf or hard-of-hearing can reach Microsoft text telephone (TTY/TDD) services at (800) 892-5234 in the United States or (905) 568-9641 in Canada. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary. To access information using the World Wide Web, go to: www.microsoft.com

For more information about Gazprom Marketing and Trading, call +44 (0) 207 756 0000 or visit the website at: www.gazprom-mt.com

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

Document published July 2011

Software and Services Microsoft Server Product Portfolio− Windows Server 2008 R2 Datacenter

with Service Pack 1− Microsoft System Center

Configuration Manager 2007 R2− Microsoft System Center Data

Protection Manager 2010− Microsoft System Center Operations

Manager 2007 R2

− Microsoft System Center Virtual Machine Manager 2008 R2

Technologies− Dynamic Memory− Hyper-V

Hardware 64 Dell PowerEdge R610 and R910

servers