Virtualization vendors target smaller businesses

IDG News Service - Editor's note: Due to a reporting error, Ben Matheson was misidentified. He is the director of product management for VMware. Also, VMware's relationship to EMC Corp. was incorrect. It is a subsidiary. The story was corrected on Wednesday, Feb. 10, around 10:25 a.m.


As large enterprises embrace the concept of virtualization to more efficiently manage their information technology systems, vendors are now targeting small and medium-size organizations.

VMware Inc. today is introducing a new low-cost service plan to give small to medium-size businesses a taste of what virtualization can do for them. Its entry-level bundle includes a free download of VMware Server software for virtualizing servers and a $1,500 support plan called Virtual Center.

At substantially less money than the $5,000 support program for large customers, the $1,500 plan is limited to three two-socket physical servers that could be converted into multiple virtual servers. If a customer wants to virtualize more servers, support would cost an extra $400 for each additional server.

Virtualization software like VMware Server makes it possible for one server to run multiple software applications at the same time, so customers don't have to upgrade hardware as quickly or use multiple servers.

VMware sees growth potential in the SMB market, given that 70% of the 1.2 million downloads of the free VMware Server software since June 2006 have been to SMB customers, said Ben Matheson, director of product management for VMware, a subsidiary of storage vendor EMC Corp. He defines small to midsize businesses as those with fewer than 1,000 employees or an average of 100 physical servers.

"There is a lot of market awareness of the value of virtualization in the enterprise [market]... but we think it's useful for all companies," said Matheson.

He said he suspects that many of the smaller businesses that are downloading the free VMware Server are just taking virtualization out for a test drive. "There are definitely a lot of trials, getting it into their labs and using things like virtual appliances and testing them. But there is also quite a bit of production use," he said.

Server vendors have also been making overtures to small and midsize businesses.

Hewlett-Packard Co. is now offering a service through which it analyzes an IT infrastructure to see how it might benefit from virtualization. HP's Virtualization Assessment Service is being offered through resellers who typically serve small and midsize customers, while HP's own sales and engineering force tends to large corporate customers.

Meanwhile, IBM has an initiative called "Virtualization Test Drive." In 2006, thecompany launched a virtualization education and sales initiative targeted at smaller businesses. IBM said that more than 65% of its virtualization sales are driven by IBM partners targeting small and midsize businesses.