Report: Virtualization Sector to Grow 43 Percent in 2009

By Chris Preimesberger  |  Posted 2009-02-12 Print this article Print

Despite the recession, global revenue from the sector will surpass $2.7 billion by the end of the year. The biggest market driver? Enterprises' need to reduce the total cost of ownership of its IT systems; green IT is a welcome byproduct.

Chalk up the data center virtualization industry as another IT sector that is not expected to be seriously damaged by the current recession.

The data storage industry has already claimed a seat on that bus-for now, anyway.

IT researcher Gartner predicted Feb. 11 that worldwide virtualization software revenue will increase a healthy 43 percent from $1.9 billion in 2008 to $2.7 billion in 2009.

Global virtualization software sales and services, and the implementation of them, is on pace to reach 20 percent in 2009-up from 12 percent in 2008, the researcher said.

Adoption of virtualization-even though it leads to better utilization of resources, reduces carbon footprint and takes less electricity from the power grid-is driven first by enterprises' need to reduce the total cost of ownership of their IT systems.

Secondarily, the drivers are: a) to enhance the agility and speed of deployment of IT needs, and b) to save energy and minimize carbon footprints.

Gartner's definition of the virtualization market includes server virtualization management, server virtualization infrastructure and hosted virtual desktops (HVDs).

The researcher expects that revenue from HVDs will more than triple from $74.1 million to $298.6 million in 2009, while revenue from server virtualization management software will increase 42 percent from $913.9 million in 2008 to $1.3 billion in 2009.

Revenue from server virtualization infrastructure will grow 22.5 percent from $917 million in 2008 to $1.1 billion in 2009.

"The recession is not having much of an effect in virtualization," Gartner Research Director Alan Dayley, who supervised this report, told eWEEK. "If it's going to have any effect at all, it'll be on the desktop virtualization side because most of the companies that are adopting virtual desktop infrastructure are financial institutions or large call centers, and some of those are being hit a little bit.

"You don't have quite as much of a TCO on the desktop side as you do on the server side."

Why not?

"The reason is that you're not reducing the number of desktops, whereas in the server environment, you're reducing the number of physical machines, physical ports and so forth," Dayley said. "Of course, you increase the number of virtual machines.

"By decreasing your physical footprint, you're increasing your storage on the server side; on the VDI side, you still have the desktop, where the user is going to work one way or another."

From a vendor perspective, Gartner said, Microsoft will challenge VMware as the dominant vendor in the server virtualization infrastructure market by 2013 and will sell well in small and midsize businesses.

The server virtualization management market is currently wide open, with more than 100 vendors supplying products and services, Gartner said.


Chris Preimesberger Chris Preimesberger was named Editor-in-Chief of Features & Analysis at eWEEK in November 2011. Previously he served eWEEK as Senior Writer, covering a range of IT sectors that include data center systems, cloud computing, storage, virtualization, green IT, e-discovery and IT governance. His blog, Storage Station, is considered a go-to information source. Chris won a national Folio Award for magazine writing in November 2011 for a cover story on and CEO-founder Marc Benioff, and he has served as a judge for the SIIA Codie Awards since 2005. In previous IT journalism, Chris was a founding editor of both IT Manager's Journal and and was managing editor of Software Development magazine. His diverse resume also includes: sportswriter for the Los Angeles Daily News, covering NCAA and NBA basketball, television critic for the Palo Alto Times Tribune, and Sports Information Director at Stanford University. He has served as a correspondent for The Associated Press, covering Stanford and NCAA tournament basketball, since 1983. He has covered a number of major events, including the 1984 Democratic National Convention, a Presidential press conference at the White House in 1993, the Emmy Awards (three times), two Rose Bowls, the Fiesta Bowl, several NCAA men's and women's basketball tournaments, a Formula One Grand Prix auto race, a heavyweight boxing championship bout (Ali vs. Spinks, 1978), and the 1985 Super Bowl. A 1975 graduate of Pepperdine University in Malibu, Calif., Chris has won more than a dozen regional and national awards for his work. He and his wife, Rebecca, have four children and reside in Redwood City, Calif.Follow on Twitter: editingwhiz

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