NetSuite Launches 'green' Discount Program

On-demand ERP (enterprise resource planning) vendor NetSuite announced a promotion on Wednesday that provides a 50 percent discount for one year if the customer can prove they belong to a "green" organization, such as the Sustainable Buildings Industry Council.

Customers who buy NetSuite subscriptions through the offer, which is effective through Dec. 31, would also see no greater than a 10 percent price increase for renewals after the first year.

Between conversations with customers and the general emphasis on green technology at both the state and federal government level, now seemed like a right time to launch the campaign, according to Dave Lipscomb, NetSuite founder and senior vice president of verticals.

For its data-center needs, the vendor contracts with hosting provider Savvis, which provides building space and access to the Internet backbone, while NetSuite brings in its own servers and management staff, he said.

NetSuite is using energy-efficient Hewlett-Packard servers, and tries to refresh the boxes frequently.

"We have found that if you keep pace and replace machines every two years, you get a tremendous power win," Lipscomb said.

NetSuite has between 1,000 and 1,500 machines, encompassing everything from production databases to application servers and test systems, he said.

Given that the company has roughly 6,000 customers, "that's a quarter of a machine per company on average," Lipscomb said. "A normal customer, to run an ERP system of any real size, is going to need a couple of [servers] to do that right, and they're going to have to cool those machines."

NetSuite's shared platform has resulted in some US$61 million in electricity savings per year for customers, according to a recent study done by Greenspace, a Northbrook, Illinois, seller of products for green facilities.

Continued advancements in hardware, not software engineering, will lead the way for more data-center power savings, according to Lipscomb.

"Software tends to like to suck up all of the [CPU] cycles that are provided by the hardware," he said. "[And] when our engineers get more power, they like to deliver more features to customers."

"An ERP application is extremely CPU-intensive by nature,'" he added. "You're constantly running reports, in addition to running a lot of transactions."

Beyond that, an ERP suite may be constantly running KPIs (key performance indicators) and content searches, and pushing up the information to executives through a dashboard. Such activities are "heavily computationally expensive," he said.

Hoping to drive more cost savings, NetSuite is doing some early tests on solid-state disk drives, which have received attention for their higher performance but also greater cost.

SaaS (software as a service) could result in customers using less power. But that doesn't necessarily mean they will save money overall compared to on-premises deployments, according to Gartner Research.

In a February report, Gartner said that although SaaS applications have an initially lower up-front cost because they do not require major capital investments for servers and perpetual licenses, over time it can pay off to deploy software in-house, because of the tax benefits customers gain as their infrastructure depreciates.