Virtual server spend soars

Virtualisation is catching on as enterprises try to contain rising server costs, says IDC. The research firm says the trend is apparent across all sections but most pronounced in the volume market.

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By  Simon Duddy Published  October 19, 2005

Virtualisation is catching on as enterprises try to contain rising server costs, says IDC. The research firm says the trend is apparent across all sections but most pronounced in the volume market. IDC predicts that server virtualisation spending will balloon to nearly US$15 billion worldwide by 2009. The firm estimates that more than three-quarters of all companies with 500+ employees are deploying virtual servers. IDC sees the business undergoing an important change as customers rapidly adopt virtualised servers in an attempt to contain costs, leverage existing IT resources and seamlessly handle growing workloads. “IT professionals are embracing virtualisation across all segments of the server market, but growth is particularly strong in the volume server space,” says Matt Eastwood, vice president of IDC's Worldwide Server research. “The risky, higher value IT projects, once reserved for more scalable servers, are now being addressed by lower-cost alternatives,” IDC also says that IBM’s traditional role as the leader in the server virtualisation business is under threat. “For many years IBM has been the perceived leader in server virtualisation with its mainframe legacy. Now that virtualisation is undergoing broad adoption in the volume server markets vendors such as HP and Dell are well positioned to garner significant market share in this space,” says Michelle Bailey, director of Enterprise Server research at IDC. In terms of revenue, IDC says S390, OS400 and Unix systems account for the bulk of customer spending on virtualised servers today, although Windows and Linux revenue is rapidly growing.

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