If you can solve your problem through software, the cost of your storage should come down in price. The software component of a storage system can be a significant percentage of the overall storage cost. Even though many vendors bundle the software with the hardware it still adds to the overall price. Compare the cost of a storage system from a vendor that does not offer the advanced software functionality and you will see that there is a cost associated with the bundled storage software.
Counting on your OS or file system to perform these storage services would also mean that you would have greater flexibility in vendor selection of the actual hardware and the protocol chosen. Essentially any system that would satisfy your needs for reliability, performance, scalability, serviceability, connectivity type and of course price would be a viable candidate. Separating the software from the hardware may also lead to greater flexibility when it comes to adding additional storage, that selection could be from the vendor that is meeting those priorities for you best at that moment, you would not be locked into the same vendor you bought storage from a year ago.
Software, especially software that is not specifically targeted at storage, may have limitations though that you need to be aware of. The potential performance degradation of the systems as the number of snapshots are taken is a good example. Especially in a server virtualization environment the number of snapshots can get into triple digits quickly. If you need that many snapshots you'll want to make sure the system (hardware or software) can support it without a negative performance impact. Another area to explore is scalability. Many OS's or file systems were not designed to scale out of the single piece of server hardware that they were attached to. This, however, can be offset by the type of external storage system you choose. Also there is the situation that if your application, operating system or file system does not support these capabilities, then you almost have to count on the storage hardware to provide them.
As storage managers decide they need more advanced storage features that may also have impact as well. Capabilities like thin provisioning, thin reclamation (the ability to keep a thinly provisioned volume thin) and capacity optimization features like deduplication and compression may all require specialized hardware. Leveraging software to provide snapshots and other storage services is not for everyone, but its cost savings potential is worth examining to see if you have the type of environment that can.
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George Crump is lead analyst of Storage Switzerland, an IT analyst firm focused on the storage and virtualization segments. Find Storage Switzerland's disclosure statement here.