Few Independent Virtualization Companies Survive
With Virtual Iron leaving the ranks of providers of independent
virtualization options, only a small number of them remain in the market, including
Parallels, Debian's OpenVZ and Ubuntu Linux.
"Market consolidation seems to be upon us," Galen Schreck, an analyst with Forrester Research, told eWEEK. "Plus, Citrix's move to give away a full-featured version of XenServer makes it pretty hard to charge for this kind of functionality.
"What's a company like Virtual Iron to do? Both are Xen-based, and have pretty similar capabilities. Sure, Citrix charges extra for its most advanced management, but you get a lot of functionality for no money whatsoever. Meanwhile, VMware is the clear market leader with Microsoft being the next most popular platform in a distant second place."
Virtual Iron aimed its wares mostly at the small and midsize business markets. Is Oracle making a play for the smaller markets with this acquisition?
"I don't think this acquisition is about smaller markets-it's more of an upgrade to the management capabilities of Oracle's own Xen-based hypervisor," Schreck said. "They get a better UI [user interface] as well as dynamic workload management and power management."
Schreck said it is still unclear how Oracle will handle the integration of both Sun and Virtual Iron into its catalog.
"There is definitely some overlap here," Schreck said. "Neither product has a lot of customers, so it's not a question of which has more market traction. Sun's xVM Ops Center is a nice product, but Virtual Iron is more Windows-friendly-which gives Oracle immediate access to the largest virtualization market."
'Interesting dynamic' with VMware
The Virtual Iron acquisition creates an interesting competitive dynamic with VMware, Zeus Kerravala of The Yankee Group told eWEEK.
"They're not the best of partners, but they do some work together," Kerravala said. "As for Sun, it [Virtual Iron] is a parallel offering. Oracle didn't have any way to virtualize Windows or Linux environments."
Katherine Egbert, an analyst with Jefferies & Co., said she believes the acquisition is a clear sign that Oracle wants to move deeper into the midmarket, a place it has hardly penetrated in the past.
"It is a midmarket play. Virtual Iron has lot of government and education [customers] in their installed base," Egbert said. "Oracle gets the full stack now, everything from the bare-metal hypervisor up to the highest-level user application."