Pre-owned IT equipment meets county’s networking needs
Jefferson County, Wis., a rural enclave of 90,000 residents nestled between two of the state’s largest metropolitan areas, is experiencing “big-city” growth due to its desirable location between Madison and Milwaukee. Along with that growth comes a growing need for IT equipment and services.
To keep pace with ongoing expansion while providing approximately 840 employees with the latest technology tools and services, Jefferson County’s nine-person IT department maintains two data centers with 33 file servers and two IBM AS/400 computer systems. A 23-mile, fully redundant fiber-optic network backbone links 11 county buildings encompassing 650 desktops and about 100 notebook computers.
According to Roland Welsch, IT manager for Jefferson County, the department relies on leading-edge IT equipment from top-tier providers, including Cisco and Microsoft, as part of an overarching philosophy to deploy market-leading products.
“Cisco plays a major role in ensuring a highly available, redundant network foundation with a full assortment of switches, routers, IP telephony and security solutions,” Welsch explained. “Implementing Cisco gear gives us the best opportunity to deliver the highest quality in voice, video and data networking services.”
In 2003, Jefferson County installed state-of-the-art Cisco equipment, including Catalyst Series 6500 and 3500 switches, 2600 Series routers as well as Cisco CallManager, 7900 Series unified IP phones, Unity voicemail and Security Access Control Server wireless access points. At the time, Jefferson County also invested heavily in Cisco’s SMARTnet support and maintenance offering to ensure the delivery of timely, regular software updates, fast response to technical questions and expedited equipment replacement in the event of catastrophic failures.
Jefferson County made this substantial investment upfront with the expectation of achieving a seven-year lifespan with its core routers and switches. As some of the devices got older, however, higher failure rates became common; at the same time, the IT staff found it was increasingly difficult to obtain identical replacements for the equipment from the manufacturer.
“Some pieces were only available if I bought the latest generation,” Welsch explained. “I didn’t want to do this for several reasons: The cost exceeded my budget and the new-generation equipment brought interoperability challenges as well as required us to learn a new version of IOS.”
Jefferson County’s network challenges were not limited to securing equipment replacement. There also were increasing challenges with maintenance coverage. Since the county is more than an hour from a major airport, the IT team elevated its service level to ensure rapid delivery of replacement gear, but it remained difficult to receive four-hour response. At the same time, the county faced increasing maintenance costs at a time when its IT budget was highly constrained.
“When maintenance on just one product goes beyond 10 percent of your budget, you know you have a problem,” Welsch said.
Pre-owned networking equipment yields savings
Questions about replacement gear for the routers and switches prevalent in Jefferson County’s network along with concerns about maintenance and support led the IT team to seek alternatives.
In late 2006, Jefferson County first purchased from Network Hardware Resale (NHR), a Santa Barbara, Calif.-based provider of pre-owned networking equipment. According to Welsch, the fact that all purchases from NHR come with a full one-year replacement warranty was a big selling point. This peace of mind enabled Jefferson County to create a cache of spares, including a Cisco 3524, a 3500, a 6513 chassis as well as spare routers and assorted other items.
In January 2008, NHR unveiled its NetSure hardware maintenance program to provide customers such as Jefferson County with extra protection for previous-generation and end-of-life equipment at substantial savings. Faced with a tight 2008 budget, Jefferson County decided to take a closer look at the alternative maintenance service.
Jefferson County moved all network elements that no longer require firmware or software upgrades to NHR’s NetSure coverage. This includes seven Catalyst 6513 and Catalyst 6509 switches as well as all the cards and blades within. Previously, this level of coverage under SMARTnet cost Jefferson County $90,000 a year – including a 19 percent government discount. Under NetSure, the same service costs $19,000 a year.
“If we had opted for SMARTnet, I would have been forced to cut a staff position to meet budget,” Welsch said. “By going with NHR’s NetSure offering, we’ve been able to realize a higher level of service while saving a valuable department resource.”
Beyond the budget savings, NetSure support has provided measurable improvements.
“NHR says if we get in touch by 2 p.m., they’ll deliver the next day,” Welsch noted. “So far, this has been true.”
At the same time, NHR’s vast inventory of equipment keeps the county’s spare pool replenished. As more of Jefferson County’s Cisco equipment no longer needs software upgrades, the prospect of buying spares for hardware swap-outs becomes even more appealing.
“We truly appreciate having a bundle of pre-owned equipment and support under one roof,” Welsch said. “We’re not interested in the cheapest parts, as it’s more important to have high-quality network gear and responsive support. Today, with the rising prices of new equipment and our tightened budget, leveraging pre-owned equipment and maintenance from Network Hardware Resale is the only way we can continue to afford Cisco and ensure maximum network uptime.”
The secondary market: a valuable alternative
Government entities of all types, sizes and shapes can find outstanding value and unsurpassed responsiveness by establishing an alternative channel for the procurement of networking equipment. So when budget limitations, immediate equipment needs or requirements for end-of-life equipment arise, a trusted secondary market provider can offer a valuable alternative.
Here are some key facts about the secondary market:
- Current-generation equipment is available. Leaders in the secondary market maintain an inventory of the most popular items for immediate delivery. In contrast, it often takes weeks or months to secure new equipment from manufacturers.
- Used equipment is not abused equipment. Reputable marketers of pre-owned equipment do not sell goods “as is.” All offerings are refurbished to ensure they are as close to original condition and performance as possible.
- More pre-owned equipment is available than ever before. Top providers in the secondary market maintain extensive inventories of the most popular networking equipment. This means the vast majority of requests can be filled on the spot. In contrast, it often takes weeks or months to secure new equipment from manufacturers.
- Third-party components are not necessarily inferior. Third-party components are often the same as those received from a network equipment manufacturer. For example, Cisco buys its memory from NEC, Samsung and other “third parties” rather than manufacture those products. Purchasing accessories such as memory directly from a third party may reduce costs as much as 80 percent.
- Sparing strategies are affordable. Since pre-owned gear typically offers savings of up to 90 percent off OEM list prices, companies seeking a fully redundant configuration can more affordably deploy a one-for-one sparing solution. An even more cost-effective alternative is a one-for-many strategy, acquiring a spare for every three to five identical network elements.
- Product warranties and support are available. Choosing pre-owned doesn’t mean sacrificing support. Leading sources of pre-owned equipment include a one-year overnight replacement warranty, which exceeds many manufacturer warranties.
Mike Sheldon is president and CEO of Network Hardware Resale. The views and assertions expressed in this case study do not necessarily represent those of GovPro.com or Penton Media.