In the coming years, VMware will continue to dominate the market for x86 server virtualization, but it face new challenges from Microsofts Windows Server 2008 and XenSource, according to a new report from Forrester Research.
The July 9 report finds that while Microsofts soon-to-be-released server product and XenSources XenEnterprise suite match some of the features found in VMwares products, it will take years for them to dislodge VMware from its spot as the premier provider of virtualization technology.
Virtualization, which allows for multiple operating systems to run on the same piece of hardware, is now being used in about 51 percent of North American enterprises, although only a minority have wide-scale deployment, according to Frank Gillett, the author of the Forrester report.
Since the company was founded in 1998, VMware has dominated the x86 server market with products such as its ESX Server hypervisor and, more recently, its Virtual Infrastructure suite.
Now, the Palo Alto, Calif., company is looking to move away from being a mere provider of hypervisor technology to a “virtual infrastructure vendor,” backed by its years of experience, Gillett wrote. Forrester analysts believe that VMware is also looking for OEMs to start building its hypervisor into the hardware itself, which will greatly increase it presence within IT.
These ambitions come as VMware and its parent company, EMC, look to offer an IPO (initial public offering) for approximately 10 percent of the companys stock. The IPO is expected to happen this summer. On July 9, Intel announced that it will invest more than $200 million in VMware and own about 2.5 percent of its common stock.
While VMware will likely continue its domination of the virtualization market, the company can also expect increased competition, especially from Microsofts Windows Server 2008 and its own “Viridian” hypervisor.
However, Microsofts hypervisor will not likely ship until mid-2008, and with various delays and updates, a newer version will not appear until at least 2009. This, Gillett writes, means that Microsoft will not be able to impact the market until at least 2010.
As for XenSource—the company that grew out of the open-source Xen project—it remains a much smaller company than VMware, which means that it too will not be able to offer a serious challenge until 2010. However, its deal with Microsoft that allows compatibility and interoperability with Windows products does provide a base to challenge VMware in the coming years.
The XenSource and VMware technology are very similar, although XenSource remains an affordable alternative, according to Forrester.
Another challenge is the growing amount of virtualization technology that Intel and Advanced Micro Devices have begun building into their microprocessor architecture. While both Intel VT and AMD-V offer advantages to VMwares software, it also means that other companies can take advantage of these chip technologies to build better virtualization products.
One way that VMware may counter virtualization products from Microsoft and others is to offer its ESX Server hypervisor for free.
The Forrester reported concluded that it will take at least two to three years for other vendors to match VMwares products, and during that time VMware will continue to expand its presence within the market.
“With thousands of customers and more than $1 billion in revenue, VMware has crossed over from startup to mainstream company,” Gillett wrote in the report. “It will get further visibility as a byproduct of EMCs IPO of 10 [percent] of VMware later this year. … Microsofts software ecosystem is much larger, but VMwares partner channel has hit critical mass on server virtualization.”