Philips LCD Monitors manual TCO breakdown, General, Related to Gartner

White Paper October 2005 When LCD Monitors can reduce TCO 13

6.2 TCO breakdown

This section provide a TCO calculation for both monitor types over a lifetime of 5 years. A cost breakdown is presented in the table below. This is a simplified calculation limited to measurable figures.

	Philips Monitor	Industry average
Acquisition phase
Vendor selection costs	C 2,176.00	C 2,560.00
Purchase costs	C 151,130.00	C 148,750.00
Total	C 153,306.00	C 151,310.00
Deployment phase
Monitor deployment costs	C 15,000.00	C 20,000.00
Asset management deployment costs	C 1,280.00	C 0.00
Total	C 16,280.00	C 20,000.00
Operation phase
Annual IT management & helpdesk costs	C 11,250.00	C 12,500.00
Annual service costs due to warranty expiration	C 2,975.00	C 3,125.00
Annual up-time power consumption	C 1,040.00	C 1,625.00
Annual idle-time power consumption	C 151.32	C 1,765.40
Annual down-time costs	C 1,875.00	C 2,625.00
Annual monitor purchase costs due to theft	C 297.50	C 1,487.50
Total (over depreciation time)	C 87,944.10	C 115,639.50
Retirement phase
End-of-Life IT costs related to asset tracking	C 1,200.00	C 6,000.00
End-of-Life saving on depreciations costs	-C2,083.33	C 0.00
Removal costs	C 4,500.00	C 6,000.00
Disposal costs	C 1,200.00	C 1,625.00
Total	C 4,816.67	C 13,625.00
Total Cost of Ownership
Annual TCO	C 262,346.77	C 300,574.50
Calculated saving
TCO saving achieved with Philips	C 38,227.73	12.7%

Table 2: Monitor TCO cost breakdown of Philips versus industry average

The above calculations are based on a number of assumptions that have been verified with various IT managers. Some of the assumptions have been derived from Gartner reports about the TCO costs of desktop PCs. The most important of these are listed below.

General:

•Energy costs per kW/hour: EUR 0.065

•Disposal costs per kg: EUR 0.50

•LCD monitor theft rate: 1%

•Man-hour costs of senior engineer: EUR 80 (e.g. network manager, purchasing manager etc.)

•Man-hour costs of junior engineer: EUR 60 (e.g. installation engineer, helpdesk agent etc.)

Related to Gartner:

•Annual operating costs of well managed PC: EUR 450

•Annual downtime costs of well managed PC: EUR 500

•Annual operating costs of unmanaged PC: EUR 75

•Annual downtime costs of unmanaged PC: EUR 105

•LCD monitor ratio of PC: 5%