The rapid evolution of Generative AI (GenAI) technology is changing the ways that many businesses think about the prospect of integrating AI with existing and future operations and products. GenAI tools have the potential to open the door to dramatically enhanced levels of efficiency and optimization, as well as completely new types of internal processes and customer-facing services. For many companies, the possible upsides of investing in GenAI tools are exciting, but when it’s time to make decisions about hosting and managing a workload, it can be difficult to decide between the competing on-premises and cloud solutions on the market. In addition, it’s easy to underestimate the expenses related to deploying and managing a GenAI workload. For a GenAI deployment to be successful, it’s important for decision makers to have a solid understanding of the total cost of ownership (TCO) of any potential workload.
We analyzed the 3-year TCO of two on-premises Dell GenAI solutions: a traditional solution and a subscription-based Dell APEX pay-per-use solution. PowerEdge R660 and PowerEdge XE9680 hardware powered both Dell solutions. We also looked at two similar cloud-based GenAI solutions from Amazon Web Services (AWS) and Microsoft Azure Machine Learning. To provide an idea of how much GenAI solutions cost, we created an AI scenario using the open-source Llama 2 large language model and compared the cost to run the workload in all four environments. Our scenario included four specific tasks in a GenAI workload: data scientist coding and other work, data processing tasks, model fine-tuning tasks, and inferencing tasks.
According to our 3-year TCO study, the subscription-based Dell APEX pay-per-use solution was the most cost-effective of the four solutions. The competitive cloud solutions from AWS and Azure cost up to 3.81 times as much as the APEX pay-per-use solution. The AWS and Azure cloud solutions we priced would also cost up to 2.88 times as much as the traditional Dell on-premises solution. These results show that organizations looking to benefit from the exciting potential of GenAI might see significant cost savings with an on-premises Dell solution, whether they opt to purchase and manage it themselves or choose a subscription-based Dell APEX pay-per-use solution.
To learn more about our in-depth GenAI solution TCO comparison, check out the report and infographic below.
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