The state of Oregon is embarking on a data center consolidation and virtualization project that officials say will save $10 million to $12 million per year.

The project, which costs $43 million, was started in 2005 with the construction of a new data center in Salem, the state capital, in which 11 separate state agency data centers serving 45,000 employees will be consolidated. The project is scheduled to conclude in June 2009 with a new Gigabit Ethernet backbone and virtual circuits replacing a frame relay network to support new applications and a converged infrastructure.

It will mark the first time Oregon has standardized its data center and network infrastructure architectures as well.

"Going to a shared service infrastructure for IT was going to significantly reduce costs, as well as standardize the environment which is going to improve quality," says Mark Reyer, administrator of the Oregon State Data Center (SDC). "It will improve the cycle time and agility of the application programming efforts to be able to develop on standard platforms."

Reyer spent 15 years with IBM directing the company's data center outsourcing and consolidation business for Fortune 500 clients such as Allied-Signal and United Technologies. With the Oregon SDC, Reyer is also looking to drive energy efficiency and carbon emission reduction -- state managers expect to reduce power consumption by 30%, with an additional 25% reduction upon completion of server consolidation.

The data centers to be converted under the program belong to 11 state agencies, including Administrative Services, Consumer and Business Services, Corrections, Employment, Forestry, Housing and Community Services, Human Services, Oregon
State Police, Revenue, Transportation and Veterans' Affairs.

Oregon is standardizing on Cisco Catalyst 6500 and 3750 switches, 7200 and 2800 series routers (compare router products), and MDS storage area network switches. The state is also implementing Cisco firewall, intrusion detection/prevention and network access control products.

Oregon has no plans thus far to implement Cisco's VFrame Data center orchestration product, which was introduced along with Cisco's Data Center 3.0 strategy last summer. Customers have been slow to adopt VFrame and Data Center 3.0 have been slow to adopt to date. Data Center 3.0 is centered on virtualizing and orchestrating server, storage and network provisioning resources to achieve cost and resource-provisioning efficiencies.