Analyst View

Virtualization will grow bigger: F&S

Although in its nascent stage, the future of virtualization market in India looks promising, noted Frost & Sullivan.

Virtualization has long been portrayed as a technology that would change the dynamics of enterprise infrastructure. The overall market for virtualization in India is still nascent. However, according to Frost & Sullivan, it is shaping up to be one of the major trends that is expected to influence the end to end infrastructure of an enterprise, namely server, storage, network, application, desktop, and so on.

Server virtualization is the forerunner in the adoption of virtualization, primarily because of the visible benefits of consolidation, reduced operating expenditure, and limited impact on user operations. In CY 2008, 24.5% of the servers sold were virtualization enabled. With hypervisors available for low cost, as well as improved management tools for managing both the physical and virtual servers, this figure is expected to grow to 60.2% by 2015. The entry of market participants such as Microsoft has changed the dynamics of the market, thereby making server virtualization solutions more affordable for a variety of end-users.

The desktop virtualization market, including hardware, software, licensing, and management tools, is estimated to have been $ 79.24 million in 2008 and is expected to grow at a CAGR of 33.31% from 2008 to 2015.

The ability to consolidate disparate infrastructure, increase utilization levels, and minimize the mounting space and power expenditures are a few of the key drivers for adoption of server virtualization solutions. Enterprises having large computing infrastructure are the first to adopt server virtualization owing to the benefits that consolidation brings about to space, power, and cooling expenditure. The main verticals are BFSI, telecom, and IT/ITES. While enterprises are becoming increasingly interested in the benefits that server virtualization solutions offer, concentrated risk, increased infrastructure complexity, and migration challenges in a virtualized environment are a few of the key restraints for adoption of server virtualization solution.

According to Saumya Upadhyaya, Industry Analyst, ICT Practice, Frost & Sullivan, South Asia and Middle East, “Interoperability with existing systems is a key criterion for enterprises aiming to migrate to virtualization solutions. With technology advancement in virtualization, enterprises are expected to be able to seamlessly migrate to such solutions soon.”

High total cost of acquisition and drastic changes to user interface are the main deterrents for the adoption of desktop virtualization solutions. Vendors are engaging in increasing the awareness of enterprise users towards the use of total cost of ownership as a tool to measure the effectiveness of a desktop virtualization environment. In addition, improvements in the desktop virtualization software and thin client technology are making the desktop virtualization solutions favorable. Ability to centrally manage desktop infrastructure and meet compliance and security requirements are the key drivers for adoption of desktop virtualization solutions. Government, education, and ITES sectors are forerunners in the adoption of desktop virtualization solutions in the country.

Infrastructure consolidation, followed by virtualization, is a key trend being witnessed in the market. With controlled capital expenditure being witnessed across the board and virtualization solutions becoming increasingly affordable, virtualization is set to become mainstream in the country.