Cover Story
Seize the Opportunity
 The growing acceptance of virtualization by Indian companies is opening up numerous opportunities for solutions providers. No prizes for those who just stand and watch
By K R Nambiar
Virtualization is no longer a mere buzzword. On the contrary, it is fast finding acceptance among Indian enterprises and opening up a vast range of opportunities for solutions providers (SPs).
According to Springboard Research, the Asia-Pacific market for virtualization software and services is expected to cross $1.35 billion by 2010. While there are no India-specific figures available, most research agencies agree that the virtualization market is on the verge of taking off and will register double-digit growth rates over the next few years.
Not surprisingly, Gartner has rated virtualization as the most-sought-after technology. “Globally, nearly 15 percent of the servers shipped are virtualized,” says Naveen Mishra, Senior Research Analyst, Gartner India.
“In India this number will be just under 10 percent, indicating that the country is almost keeping pace with the overall market. With the economic slowdown and the pressure on cost optimization, we are seeing more enterprises considering IT infrastructure consolidation and virtualization. If the IT infrastructure is properly virtualized it can bring tremendous savings.”
Five categories
Analysts divide the virtualization market into five categories—server, desktop, application, storage and network. The earliest adoption rates are highest for server virtualization solutions, followed by desktop virtualization.
Server virtualization is the process by which a physical server can be used to run multiple applications and operating systems simultaneously. “There’s little doubt that the biggest interest is in server virtualization because customers are able to realize fast and tangible ROIs. Since one of the primary effects of server virtualization is a reduction in the number of physical servers, the cost of managing them also falls,” explains Ganesh Mahabala, Director, Sales, VMware South Asia.
Server vendors such as IBM, Dell and HP are doing their bit to ensure that their boxes are virtualization-ready. “Today, all our servers come enabled with virtual hypervisors which support the virtualization platforms of all leading vendors such as Citrix, VMware and Microsoft,” says Aman Dokania, Director and General Manager, Infrastructure Software, HP Asia Pacific and Japan.
Energy savings is another tangible benefit of server virtualization. “There are distinct and significant energy savings in consolidating and virtualizing the server infrastructure,” notes Anoop Nambiar, Country Manager, Business Partner Organization, IBM India. “In many virtualization projects, energy savings emerges as a leading objective.”
Nambiar cites a recent global survey conducted by IBM among SMBs. “The SMBs surveyed identified energy costs as one of the biggest cost increases for them over the past two years. Interestingly, 64 percent of Indian respondents (as against the global average of 58 percent) underlined the rise in energy costs as a key factor impacting their business growth.”
Desktop virtualization
While almost everyone agrees that server virtualization has wide acceptance, the same cannot be said about desktop virtualization. Desktop virtualization is essentially a computing model whereby desktop applications are centrally hosted without compromising on the desktop experience of the end-user.
One of the reasons why desktop virtualization has failed to take off is because the acquisition cost of the solution is much higher.
“Compared to server virtualization, desktop virtualization does not have ready acceptance among customers,” observes Mishra of Gartner. “This is because the customer needs to cough up a licensing cost to a virtualization vendor, beef up the data center, and plan for thin client devices for users—all this adds up to a prohibitive cost of acquisition. This has been a hindrance to some extent because CIOs are reluctant to try out a business model which demands higher capital investment.”
Mishra believes that the right time to talk about desktop virtualization is when a customer is preparing for a technology refresh or an upgrade.
Souma Das, Area Vice President, Citrix Systems India, stresses that the positioning with regard to
desktop virtualization needs to be perfect. “Desktop virtualization provides better ROI when a customer is of a reasonable size as is the case with most enterprises. While upfront costs are higher, we have seen cases where the ROI has been realized in less than six months.”
There are other advantages. Deployment times are extremely low in cases of desktop virtualization because an MIS team can provision desktops; the cost of deploying applications is also low. Desktop virtualization increases the life of the clients by five to six years, and client downtimes can be fixed in no time.
“From a user perspective, a person can get the same desktop experience without compromising on performance. MIS managers can deploy applications across thousands of desktops in minutes instead of the days it may have required earlier,” says Vinod Krishnan, Regional Manager, VMware India.
Application and storage
Server virtualization usually goes with application virtualization because a consolidated core IT infrastructure requires a consolidated software infrastructure. “There has been remarkable interest in our XenApp in the recent past. Large corporations, and even PSUs, are buying the product for app virtualization,” informs Das of Citrix.
Storage virtualization is another area where there seems to be considerable opportunities for growth. “Whenever customers opt for desktop or server virtualization they need to re-plan the way they store data and this brings in a lot of opportunities for virtualized storage,” explains Alvin Kho, Senior Manager, Dell India. Adds Mahabala, “It’s a known fact that every dollar you spend on virtualization throws up five to seven dollars of service and storage opportunities.”
Recession as a driver
Recessionary trends in the economy have been the biggest driver for virtualization because there is pressure on CIOs to explore cost-effective computing options. While practically every segment is considering server virtualization, Dokania of HP stresses that even those IT/ITES companies which cut their IT budgets as a result of the slowdown are increasingly buying virtualization solutions.
“Previously, these customers used to buy new servers and infrastructure for application and deployment testing. Now they are banking on virtualization to reduce costs,” notes Dokania. He adds that SEBI’s directive to all BFSI establishments to invest in disaster recovery centers will also fuel the growth of virtualization. Indeed, BFSI and insurance sectors are now said to be taking an active interest in desktop virtualization solutions. “Banking and insurance are the best bets for desktop virtualization, closely followed by telcos and the retail sector,” says Das of Citrix.
A virtualization boom is also expected as a result of the new cloud computing projects which Indian customers are actively pursuing. “You will be surprised to know that there are at least 50 large cloud computing projects which Indian enterprises are pursuing, with their pilots in full swing,” reveals Krishnan of VMware.
Big boys in the biz
Little wonder then that every vendor worth its salt is today talking big about virtualization. Over the last one year many IT infrastructure vendors such as IBM, HP, Dell, Sun and EMC have been working hard to equip their partners to acquire specialization in virtualization solutions.
Intel and AMD have independently developed virtualization extensions to the x86 architecture. Though not directly compatible with each other, they largely serve the same functions. Both will allow a virtual machine hypervisor to run an unmodified guest operating system without incurring significant emulation performance penalties.
Vendors such as VMware, Citrix and Microsoft are offering the basic hypervisor free, but are selling for a cost the tools that can manage the ecosystem. VMware has just overhauled its VMware partner program (which is more of single umbrella program), introduced a new set of partner competencies, and brought out a revamped partner university and a revamped partner portal.
“You can now become a VMware partner by simply registering on our Web site. We then provide you with a host of online pre-sales and post-sales technical training in virtualization and our product portfolio,” explains Krishnan of VMware.
Both Citrix and VMware sell services through channels. Citrix has also announced that it will be doubling the number of partners it engages with this year, and that it is on the look-out for more partners.
“It’s extremely important for channel partners to recognize the opportunity in virtualization,” says Das. “There’s a real paradigm shift happening in enterprises, and that will shortly spill over to the SMB segment. You’ll soon see IT organizations offering infrastructure to various business units on hire, almost the same way an Amazon or Google is offering application hosting.”
Server vendors such as HP and IBM are offering training in virtualization as part of their alliance programs. Both vendors have a number of offers which are easily packaged for partners to sell virtualization solutions. For instance, HP is set to launch a virtualization bundle, an integrated solution that allows SMBs to more easily and cost-effectively deploy virtualization by transforming existing servers and storage.
Earlier, HP had also launched the BladeSystem Matrix, a modular data center offering. “Market
trends are heavily favoring virtualization solutions, and we have the best-of-breed solutions in this space,” says Dokania. “Recession apart, there’s motivation to reduce costs, including saving on energy bills, among all enterprise and large mid-market customers in India.”
Meanwhile, IBM is offering solutions customized under its Dynamic Infrastructure portfolio in which virtualization is a key component. IBM recently launched 50 new and enhanced products and services, including a customer financing scheme to attract enterprises to invest in virtualization solutions.
“We are finding many takers for the Dynamic Infrastructure solutions after we launched the financing scheme,” informs Nambiar. “We are selling our solutions on clear ROI deliverables which can be achieved through enhanced energy efficiency, and better asset and service management.”
Microsoft, a late entrant in the virtualization game, is bundling its hypervisor free with its Windows Server Enterprise editions. Recently the company released open-source Linux driver code under the GPL license which will make Linux distributions work better as a host operating system on the Microsoft hypervisor.
Sun Microsystems has been promoting its Virtual Box virtualization platform for both data centers and the desktop virtualization marketplace. Red Hat is another vendor pushing its virtualization platform. Its recent acquisition of Qumranet has given the vendor enterprise class virtualization platform.
However, while all vendors are trying to make it easier for solutions provider to ready their teams to go after opportunities, the transition is not always smooth.
“Selling virtualization solutions requires a mindset that’s slightly different from that required for selling traditional computing, where a reseller goes and sells more. In this case you (reseller) act as a consultant and talk about selling less hardware to save costs, and your revenues are more from the services you provide,” explains Mahabala.
Still, partners are getting ready to grab the opportunities. This is evident from the CRN Channel Confidence Survey where 62 percent of SPs said that their goal this year was to build capabilities around infrastructure consolidation and virtualization.
Affirms L Ashok, CEO of the Chennai-based Futurenet: “Virtualization is definitely a technology area we are betting on this year because our customers are increasingly demanding faster ROIs and lower costs of ownership.” |