Virtualization services market $11.7 billion by 2011
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Blog: Virtualization services are expected to turn into a $11.7 billion market by 2011, more than double its current level, according to an IDC report. VMware and its competitors are helping to drive this demand.
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IBM, HP, Sun and Dell lead the market, which saw 7.7 percent revenue growth in the second quarter, compared with a year earlier.
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More than 80 percent of VMware income comes from higher-level tools, a move that gives the EMC subsidiary more breathing room against rivals.Getting real about virtualization
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India&#39;s IT services market is forecast to grow to $10.73 billion by 2011, at a five-year compound annual growth rate of 23.2 percent, as outsourcing emerges as a more favored option for companies in India, according to research firm Gartner.As companies are finding it more difficult to hire and retain staff in their IT departments, they are looking at external service providers as an option, hoping to also cut down costs, and better manage growth in the process, Gartner said Tuesday.Indian user companies compete for staff with Indian outsourcing companies and Indian operations of multinational companies, which hire new staff by the thousands each quarter.Staff attrition is however not the key reason why companies are outsourcing, said Arun Gupta, chief technology officer, at Shopper&#39;s Stop, a top Indian retail chain. Driving outsourcing in India is a growing demand for new technologies and applications. Shopper&#39;s Stop has six IT projects in progress with another 12 projects planned for the next six to 12 months.Rather than creating and managing a large IT organization in house, the company is working with service partners to support its 45 IT staff, Gupta said. Some of the functions it outsources are network maintenance, desktop and server maintenance, monitoring enterprise resource planning (ERP) applications, and software development, he added.A number of large banks and telecommunications service providers are already outsourcing key IT operations, though the key winners so far have been multinational services companies. Many Indian outsourcing companies had neglected the Indian market in favor of exports, according to a survey last year by Gartner. But that may be changing as the&#160;weakening dollar puts pressure on rupee&#160;realization from exports.IBM,&#160;Tata Consultancy Services (TCS), and Wipro together accounted for 26.1 per cent of IT services vendor market share in India last year, according to Gartner. IBM was the top vendor, with 11.2 per cent market share. TCS and Wipro occupy the second and third positions with 10.9 and 4.1 percent market shares, respectively.However, the Indian IT services market is still fragmented, with the majority of the market being serviced by smaller local players that account for close to 40 per cent of the IT services market, according to Gartner.&quot;We have looked at smaller players for very small and specific jobs, but for larger jobs, running into a number of years, and which require a variety of skills, we look at large Indian companies or multinational services companies,&quot; Gupta said.The key segments of the Indian IT services market are hardware maintenance and support, software support, consulting, development and integration, IT management, and process management, Gartner said.
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Low-end servers saw the most growth -- 11% year over year -- while growth in midrange server market came in at under 1%, researcher IDC said.
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(InfoWorld) - Virtual Iron and XenSource both are introducing new virtualization software to undercut on price the dominant player in the field, VMware. On Monday, Virtual Iron is set to start offering Version 3.1 of its enterprise-class virtualization platform for a license price of $499 per socket, which is less than 20 percent of the $2,875 per socket price for a comparable VMware license, according to Virtual Iron. Virtual Iron argues that VMware's pricing is a barrier to more widespread adoption of virtualization in data centers, citing IDC research that only 6 percent of data center operators deploy any type of virtualization. Also Monday, XenSource introduced new and upgraded virtualization products, also at sub-$1,000 prices. Both XenSource and Virtual Iron build their proprietary products on top of the open-source Xen platform for virtualization hypervisors. A hypervisor is technology that makes it possible for one computer to run multiple operating systems at the same time. VMware's products are not based on open source. Virtualization refers to software and other system management tools that are used to better utilize servers. Virtualization makes it possible for one physical server to run multiple applications simultaneously. Advanced virtualization features include tools to seamlessly move computing workloads from one physical server to another, set up infrastructure and test new software. Revenue at VMware, a wholly owned subsidiary of storage vendor EMC, grew 86 percent in EMC's fiscal third quarter to $188.5 million. If that pace keeps up, VMware's annualized revenue would be $750 million, VMware said. Virtual Iron and XenSource intend to slow that pace. "We are taking a very aggressive stand on pricing," said Mike Grandinetti, chief marketing officer for Virtual Iron. The Charlotte Observer newspaper in North Carolina uses Virtual Iron. It took 45 minutes to run a particular job on its legacy Unix-based servers, said Geoff Shorter, the Observer's IT infrastructure manager. VMware completed the same job in 11 to 13 minutes, but so did the less expensive Virtual Iron. The license for the high-end VMware product costs $5,750 to run on a dual-socket server, Shorter said. Virtual Iron's license is $499 per socket, so the total cost for a dual-socket machine license would be $998. Pricing for XenSource's XenEnterprise starts at for $488 for an annual subscription license for a dual-socket server or $750 for a perpetual license. XenServer for Windows, introduced Monday, sells for $99 per dual-socket server, per year. It has fewer features than XenEnterprise. "Our intention is to dramatically shift the landscape under VMware," said Simon Crosby, XenSource's chief technology officer. Virtualization is following a classic economic model of an early mover dominating a market and charging a premium, soon followed by challengers competing on price, said Gordon Haff, principal IT advisor at Illuminata Inc., a technology research company. Haff said enterprises that have deployed VMware are seeing a positive return on their investment despite the price and he doesn't think price alone is keeping enterprises from adopting virtualization. "Even if virtualization software were free, it wouldn't become ubiquitous because of the complexity of the implementation," he said.
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TechWeb - The portion of new business software revenue generated from SaaS products is expected to increase to 25 percent by 2011.
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Demand in both the home and business software markets sees Microsoft's profits rise by 11% over three months.
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Microsoftâs Systems Center Virtual Machine Manager 2007 allows companies to deploy virtualization technology and centralize management.
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New virtualization technique may mean fewer physical servers are needed, study says.
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(InfoWorld) - Many of the software trends that percolated in the industry in 2006 will gather more steam in 2007, but several stand out as contenders to change the game for the market in the new year. Below are some of the key software trends to watch for in 2007. Windows Vista ... again Just when you thought it was over, the chatter surrounding Microsoft Corp.'s long-delayed Windows client update has only just begun. 2007 will be a crucial year for the OS, which will finally make its mainstream debut to consumers at the end of January. Microsoft, its hardware and component partners and Wall Street will be keeping a keen eye on customer adoption of Vista to see if it really was worth the wait. 2007 also may be the year Apple Computer Inc.'s Mac OS could gain more mass appeal among users that in the past might have bought a Windows PC, giving Vista its first real competition in ages. The competition can be attributed to two things. One, Apple now offers Intel chip-based PCs that are less expensive than previous Apple computers and thus a more viable option for the average PC user. Secondly, more consumers seem to be catching on to the fact that the Mac OS is -- and has always been -- more cutting-edge, attractive and just so much more fun to use than Windows. Software as a service (SAAS) As Google Inc. and SAAS pioneer Salesforce.com Inc. continue to be financial successes, other companies begin sending out software that has traditionally been sold in packages to customers over the Web. Microsoft may soon be joining the fray, and in fact is steadily building out its Web-based service business under the direction of Chief Software Architect Ray Ozzie. Indeed, many believe Vista will be the last packaged-software version of Windows as Microsoft eventually will begin offering new versions of the OS over the Web. Keep an eye on less packaged software and more SAAS offerings from other traditional players in 2007 as well, including Oracle Corp. and SAP AG. Virtualization Enterprises will continue to adopt this software, which enables more than one OS to run side-by-side on a single server. Nearly every major hardware and software vendor -- from IBM Corp. to Intel Corp. to Microsoft to virtualization giant VMWare Inc. -- has a vested interest in virtualization, and expect its use to become more pervasive in 2007. However, as that happens, virtualization -- along with related sever technology that contains multiple processors -- will change the game for how software and hardware is priced, setting the stage for new pricing models across the industry. Business intelligence (BI) Giving enterprises more insight into the factors that affect their business is becoming an increasing focus for enterprise software companies, which is why business intelligence itself is a growing market. With Microsoft gradually building out its business intelligence portfolio, pure plays like Business Objects SA and Cognos Inc. are getting nervous that their partnerships with the vendor are about to be cannibalized. Unfortunately for them, they are probably right, and by the end of 2007, the competitive landscape in BI will look different than it does today. Office productivity Windows Vista won't be the only major software package to hit the streets from Microsoft in 2007 -- a new and improved version of Office is expected to be on retail shelves at the end of January. But as Microsoft repositions its revamped worker productivity suite as a business intelligence and collaboration tool, keep an eye on online competitors from Google and others to see if they begin loosening Office's stranglehold on the market. The new partnership between Microsoft and Novell Inc. also will be a factor in this space, as Novell plans to support Microsoft's Office document format in its version of the open-source OpenOffice suite by the end of January. This will allow users of OpenOffice to better send and receive files from Microsoft Office users, making the key open-source alternative to Microsoft Office a more viable option for the mainstream user. Service-oriented architectures (SOAs) SOAs have been making "technology to watch" lists for several years running, yet the IT architecture, which is based on the idea of linking independent applications as services in a network to create custom composite applications, is still in its earliest stages of adoption. Expect enterprise companies to continue getting their feet wet by adopting SOA projects to solve specific needs in their businesses, and expect companies such as IBM, SAP, BEA Systems Inc. and Microsoft to continue to trumpet their software products as the best ones to use as the underlying infrastructure for those projects.
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One of the factors that could put a damper on the server virtualization market is the lack of formal commitments by software vendors to support their applications on virtual systems.
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IBM's says 2007 services and software revenues were up, sees emerging markets as a 'virtual gold rush.'
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Showing just how hot the virtualization market has become, Intel has taken a minority stake in VMware, now owned by enterprise storage company EMC. Intel is investing $218.5 million for 2.5 percent of all outstanding VMware common stock, and will gain control of one board seat.
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XenExpress OEM Edition for servers The hype for virtualization may be reaching a fever pitch, but market penetration remains at a high-ball figure of only about 7 per cent. The aim now falls squarely on selling in volume, so it's not a surprise to see the market eyeballing OEM vendors.â¦
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SEPTEMBER 20, 2004  - VMware Inc. released today a virtualization tool for PCs it says will cut hardware and maintenance costs for users such as independent contractors that support third parties on their networks.
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Butler Group report predicts savings from virtualization as it reduces energy consumption and operating costs.