BUSINESS
SMEs yet to be convinced by virtualisation
07-09-2007
by Emmet Ryan
Virtualisation providers have yet to convince Irish SMEs of the technology's potential, analysts at IDC have told ENN.
Research by the firm indicates that large companies in Europe see benefits in virtualisation but that SMEs have yet to show the same level of interest. "It's certainly not seen as a mature technology by SMEs in any of the countries we've gone to," Chris Ingle, consulting and research director with IDC, told ENN. He made the comments at a roundtable event in Munich held by Novell, Intel and IDC.
Virtualisation technology is designed to allow computers and servers to be used much more efficiently by facilitating several programs at the same time. Virtualisation firms say that virtual infrastructure software enables multiple virtual machines to be run on a single physical server, making for more effective and efficient use of customers' server hardware resources.
The manner in which providers sell virtualisation products needs to change in order for the technology to take off among SMEs, according to Ingle. He said providers looked at virtualisation from a very technical standpoint when selling the product and needed to communicate the benefits to SMEs in terms that are easier for them to understand.
The past few months have seen a flurry of activity worldwide on the virtualisation front despite the technology carrying the albatross of being considered the 'next big thing'. Virtualisation provider VMware had arguably the most hotly anticipated initial public offering since Google when it listed on the stock market in mid-August. The offering raised USD957 million for the firm and the value of the stock rose 76 percent on the first day's trading alone. Meanwhile, that same month Citrix used its financial muscle to build its presence in the virtualisation market with the announcement that it was buying XenSource for USD500 million.
The faith larger firms have shown in the technology has helped keep the virtualisation fires burning. An IDC survey of 250 large European firms last year found that 69 percent of servers purchased in the previous 12 months by these firms were virtualised. A total of 7 percent of all servers in these businesses were virtualised. The IDC analysts expect SMEs to start getting on board soon and that by 2011 around 45 percent of servers shipped will be virtualised.
The same study found that the prospect of firms saving money due to the greater efficiency of virtualised machines was the top reason businesses were interested in the technology. "At the end of the day they are virtualising because they want to save costs," said Alan Priestley, Intel's enterprise marketing manager for Europe, the Middle East and Africa.
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