VMware knows it may not be able to hold onto 80 percent of the hypervisor market forever.
But its strategy is to move well beyond server virtualization and into value-added services that use virtualization to help customers manage their infrastructure more effectively.
While the emphasis in recent years has been on the benefits of virtualization as a way to cut costs by consolidating servers, today the emphasis is on tools that IT administrators can use to provide better disaster recovery through virtualized storage and more flexible IT structures that provide business users with more strategic options.
Dan Chu, vice president of emerging products and markets at VMware, said the company is trying to scale the benefits of virtualization across the enterprise.
"Once you have that [virtualization] substrate, you can do things you couldnt before without complex clustering technology," he said.
Bogomil Balkansky, VMwares senior director of product marketing, added that the agreement VMware struck with hardware vendors to embed the ESX Server 3i hypervisor in new servers gives the Palo Alto, Calif., company a lot of opportunities to extend that technology into areas such as disaster recovery, support for corporate desktops and software distribution.
"We can provide a new level of automation in the data center," he told EWEEK.
Click here to read about VMwares acquisition of Dunes Technologies.
In addition to products like VMotion, which allows for the live migration of running applications, the company unveiled storage and risk mitigation products it plans to introduce to the market in the coming months.
One such product, called Swingbatch, allows customers to migrate virtual machines from one data store to another without shutting down the virtual machine.
Another product will allow running applications to switch from one server to another in the event that the first server fails.
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Company executives claim that the technology is also becoming easier to use, making it possible for server administrators and other IT staff to perform more strategic functions and increase their value to their employers.
"ESX 3i has flattened the learning curve enormously," said Balkansky. "So we obviate the need for an IT high priest."
The biggest challenge for customers will be changing internal processes, such as how they do approvals for new servers or who approves the configurations.
"The old process was bad, but it was a well-documented bad process," he said.
VMware executives believe they can build market share by selling higher-margin products that build on the companys lead in virtualization.
VMware CEO Diane Greene noted that while the company expects stiff competition from Microsoft and others, VMware is already treating the hypervisor almost like a commodity. "The hypervisor has enormous advantages that should not be discounted—but the revenue model were using takes advantage of other advantages of virtualization.
"Were being very effective at building products that unlock the value of virtualization," she added during a question and answer session with reporters at the VMWorld user conference in San Francisco.
Read more here about VMware CEO Diane Greenes assertion that her company wont make large acquisitions in the near future.
IDC analyst Stephen Elliot agreed that value-added applications will drive the market as hypervisors become mainstream. "Its a tools vector that allows the platform to spread," he said.
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