Microsoft Authorized Refurbishers - Revisited

A few weeks ago I posted on the Microsoft Authorized Refurbishers program and I was convinced it was a joke, but apparently someone has taken it seriously because I got an email this week promoting the "MAR Americas" program by using TCO analyses of Used vs. New Computers.

Here's a tidbit:

Total Cost of Ownership Cost Analysis:
Used vs. New Computers for Schools
 
Have you ever been asked to justify your assertion that purchasing a refurbished computer is less expensive than purchasing a "New" pc?  It seems the issue of warranty, repair and energy consumption is almost always used as a reason to avoid the decision to purchase these machines.
 
Recently, a school district in the Midwest attacked the issue by laying out this basic formula to analyze the total cost of ownership for the computers they put into their schools.
• Total Cost of Ownership (TCO) = (Unit Cost/Machine Life) + Estimated Yearly Repair Costs + Estimated Yearly Energy Costs
• Used PC Machine Life = 3 years - 6 years
• New PC Machine Life = 6 years
• Estimated Yearly Repair Costs = (Estimated Yearly Failure Rate * Average Failure Cost)
• Estimated Yearly Failure Rate = 5%
• Average Failure Cost for a PC: with No Warranty = $100; with Onsite Warranty = $10; with Parts Warranty = $30
• Energy Costs = (Active Hours Per Year * Active Watts Used) + (Standby Hours Per Year * Watts Used) * Energy Rate Kwh / 1000 w/kw)
• Active Hours Per Year = 6 * 175 School Days = 1050 hours
• Standby Hours Per Day = 4 * 175 School Days = 700 hours
• Energy Rate kwh = $0.0820/kwh

Now in my experience, even with new equipment it is very easy to exceed a 5% failure rate per year - sad, but its true. Even a refurbished computer that is 3 years old is going to have a higher failure rate than a new computer, simply because there is more wear-and-tear on the parts - particularly the hard drive. Anyhow, you can check out their analysis here.