Midrange Enterprises, SMBs Are Key Topics at VMworld 2009

SAN FRANCISCO—People are saying that the VMworld 2009 conference, which opens Aug. 31 at Moscone Center here and has attracted some 200 vendors and more than 11,000 attendees, might be the newsiest IT show of the year. And they could be right.

CES in Las Vegas and CeBIT in Hannover, Germany, certainly have the inside track on all the new gadgets; nobody is going to argue that point. Dozens of smaller events staged by Intel, Microsoft, Hewlett-Packard, IBM and others are also not to be sneezed at for their news and innovations.

But for overall IT news value this year, VMworld appears to stand on its own.

After all, just about every IT company worth its salt is hooked up in some way to virtualization, either as a product/service provider, as a reseller of services or as a user. All the major software and systems providers will have news of some sort to announce at this event.

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VMware itself will make an announcement on Monday around simplification of virtualization software for midrange and small-to-medium-size businesses. IBM and HP will be releasing their news Sept. 1; we'll have it all here on eWEEK. The conference continues through Sept. 3.

Even VMware competitors such as Microsoft, with its Hyper-V hypervisor, and Citrix, with XenServer, will have booths at the event and will be issuing news releases.

Most industry people agree that virtualization represents the biggest sea change in the industry since the Internet gained critical mass in the mid-1990s. And now that this valuable software layer has attained trusted status in most large enterprise data centers (some studies claim 85 percent Fortune 1000 market penetration) for regular production use, the word is spreading that smaller IT setups—meaning anywhere from 1 to 1,000 servers—can also take advantage.

If there is an underlying message from this show to the IT world, it's this: Enterprises of all sizes now can share in the values and efficiencies of using a virtualized system, and, yes, you can save bottom-line cost and help the environment—all at the same time.

VMware Customers Mostly SMBs

Who's going to dispute any of that?

"I agree that the trend [in virtualization] is moving to more smaller companies, but it's not like SMBs are just getting started," Bogomil Balkansky, VMware's vice president of product marketing for servers, told eWEEK.

"VMware has about 150,000 customers, and we believe about 97 percent of the Fortune 1000 are using our software. Well, guess what? The remaining 149,000 [companies] aren't the Fortune 1000. The overwhelming majority of our customers, in just sheer numbers, are small and medium-size companies."

At least 100,000 of VMware's customers are "really small businesses," Balkansky said. It's difficult to determine how many small businesses—in the United States anyway—use at least one server, he said, but "it's definitely less than a million. It's probably no more than a half a million."

Oracle claims about 300,000 customers in about 30 years in business, Balkansky said, giving a relatively solid number about businesses that at least use a server and a database.

"This gives you some approximation for how far down the pyramid, so to speak, IT is actually permeating," Balkansky said. "If Oracle has 300,000 customers, that means that there are perhaps 500,000 businesses with servers worldwide. Certainly there are no more than a million."

A lot of them will be watching what happens this week in San Francisco. Go here for more information on VMworld 2009.