Business Case

Do I need a cache proxy?  A Cost - Benefit Analysis.

Provider A is a large ISP, serving its clients with a high-speed leased line, which has running costs of $450.000  per year. About 64% of total traffic accounts to HTTP traffic.

Question:  Do I have any benefit setting up a cache scenario?

Assumptions for a cache scenario:

  • Running costs for the leased line per year for ISP A  = $450.000
  • 64% of total traffic accounts to HTTP = $450.000 x 0,64  = $288.000

Calculation:

  • Initial costs and deployment of a multi-terabyte cache cluster = $50.000
  • Annual support contract for a multi-terabyte cache cluster = $10.000
Total investment first year = $60.000
  • Assuming a minimum average of HTTP bandwidth savings with a cache proxy of 25% leads to a minimum annual costs saved = 25% of $288.000 = $72.000

Benefit first year
= Annual costs saved - total investment first year
= $72.000 - $60.000 = $12.000

Benefit following years
= Annual costs saved - support contract costs
= $72.000 - $10.000 = $62.000

Benefit after 3 years:
= Benefit first year + 2 * benefit following years
= $12.000 + 2 * $62.000 = $136.000

In this business case, ISP A has a benefit of $12.000 in year one by introducing a cache cluster, plus $62.000  in each year that follows. This results in a total benefit of $136.000 after 3 years. By using CacheMARA the ISP  also benefits from its large number of great features, enabling the ISP to perform better than its competition.