magic quadrant for x86 server virtualization infrastructure

8/3/2019 Magic Quadrant for x86 Server Virtualization Infrastructure

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Page 2ttp://www.gartner.com/technology/media-products/reprints/microsoft/vol2/article8a/article8a.html

Source: Gartner (June 2011)

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Market Overview

The x86 server virtualization infrastructure market is the foundation fortwo extremely important market trends: infrastructure modernization andcloud computing. For infrastructure modernization, virtualization is being

used to improve resource utilization, improve the speed of resourcedelivery and encapsulate workload images in a way that enablesautomation. Virtualization is also being used as a basis for cloudcomputing both private and public. In the last year, the number ofserver virtual containers and VMs more than doubled, due to:

Growth in workloads

Rapid growth in customer adoption

Increased use of hosted virtual desktops (HVDs; on servers)

Increased use of cloud IaaS

Significant growth in midmarket enterprises beginning to virtualize

for the first time

Maturity of product offerings

Interoperability between service providers and enterprises is becomingmore important, as enterprises plan to build architectures that can enableworkload migration to and from cloud providers, and hybrid cloudcomputing ("cloudbursting").

x86 server virtualization infrastructure provides the foundation for newmanagement and automation tools, new security architectures and new

investing in the product, will continueoffering the product and will advance thestate of the art within the organization'sportfolio of products.

Sales Execution/Pricing: The vendor'scapabilities in all pre-sales activities and thstructure that supports them. This includedeal management, pricing and negotiationpre-sales support and the overalleffectiveness of the sales channel.

Market Responsiveness and TrackRecord: Ability to respond, change directibe flexible and achieve competitive succesas opportunities develop, competitors act,customer needs evolve and market dynamchange. This criterion also considers thevendor's history of responsiveness.

Marketing Execution: The clarity, qualitycreativity and efficacy of programs designto deliver the organization's message toinfluence the market, promote the brand abusiness, increase awareness of theproducts, and establish a positiveidentification with the product/brand andorganization in the minds of buyers. This"mind share" can be driven by a combinat

of publicity, promotional initiatives, thoughleadership, word-of-mouth and salesactivities.

Customer Experience: Relationships,products and services/programs that enabclients to be successful with the productsevaluated. Specifically, this includes theways customers receive technical support account support. This can also includeancillary tools, customer support programs(and the quality thereof), availability of usgroups, service-level agreements and so o

Operations: The ability of the organizatioto meet its goals and commitments. Factoinclude the quality of the organizationalstructure, including skills, experiences,programs, systems and other vehicles thaenable the organization to operate effectivand efficiently on an ongoing basis.

Completeness of Vision

Market Understanding: Ability of thevendor to understand buyers' wants andneeds and to translate those into productsand services. Vendors that show the highedegree of vision listen to and understandbuyers' wants and needs, and can shape oenhance those with their added vision.

Marketing Strategy: A clear, differentiat

set of messages consistently communicatethroughout the organization and externalizthrough the website, advertising, customeprograms and positioning statements.

Sales Strategy: The strategy for sellingproducts that uses the appropriate networof direct and indirect sales, marketing,service and communication affiliates thatextend the scope and depth of market reaskills, expertise, technologies, services andthe customer base.

Offering (Product) Strategy: The vendo


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virtualization infrastructure market are simply enablers, thesetechnologies will be used by vendors to drive customers to higher-levelmanagement and automation technologies. Choices made at the lowerlayers matter.

The market is becoming very competitive both in terms of productofferings and in terms of overarching visions for the road map to cloudcomputing. VMware remains the market share and technology leader, butthe market is growing rapidly, and competitors like Microsoft and Citrix

Systems have a larger share now than they did a year ago. While themajority of Global 1000 enterprises have been virtualizing for severalyears, many smaller enterprises and those in emerging economies arejust starting out, or haven't started yet. These enterprises have severalviable alternatives from which to choose. In addition, as the cloudcomputing paradigm continues to evolve, cloud service providers offeringIaaS want to make interoperability with their service offerings easy. A keytrend in service providers is a shift to support better interoperability withexisting enterprise virtualization infrastructures in many cases,expanding their support for the same technologies that enterprises areusing.

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Market Definition/Description

The x86 server virtualization infrastructure market is defined byorganizations that are looking for solutions to virtualize applications fromtheir x86 server hardware or OSs, reducing underutilized hardware andassociated costs, and increasing flexibility in delivering the server capacitythat applications need. In 2011, we are adding HVDs (in server VMs) tothe list of workloads covered by this market.

Solutions for this market leverage:

Hypervisors to create VMs

Shared OS virtualization technologies (also called "containers")

Server virtualization administrative management (base frameworks)

Server virtualization embedded management (live migration andbasic automation of administrative management functions)

Not included are higher-level management functions, such as operationalautomation tools that deal with virtual resources, application performancetools that leverage and monitor virtualization, disaster recovery tools thatleverage virtualization, desktop provisioning and brokering software, etc.

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Inclusion and Exclusion Criteria

Vendors that were eligible for inclusion in this Magic Quadrant met thefollowing criteria:

They must provide x86 server-based solutions to virtualizeapplications from OSs, or OSs from x86 server hardware, using:

delivery that emphasizes differentiation,functionality, methodology and feature setas they map to current and futurerequirements.

Business Model: The soundness and logiof the vendor's underlying businessproposition.

Vertical/Industry Strategy: The vendorstrategy to direct resources, skills andofferings to meet the specific needs of

individual market segments, includingvertical markets.

Innovation: Direct, related, complementaand synergistic layouts of resources,expertise or capital for investment,consolidation, defensive or pre-emptivepurposes.

Geographic Strategy: The vendor'sstrategy to direct resources, skills andofferings to meet the specific needs ofgeographies outside the "home" or nativegeography, either directly or throughpartners, channels and subsidiaries asappropriate for that geography and marke


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Container technology

They must provide basic administrative tools for those solutions:

Administrative management frameworks/suites forhypervisors/containers

Embedded virtualization management technology (e.g., live

migration)They must have at least 100 different organizations using theirgenerally available products as of 1 April 2011.

Open-Source Communities (e.g., Xen and KVM Hypervisors)Versus Vendor-Embedded Open-Source Software Business Models

The x86 server virtualization infrastructure Magic Quadrant includes onlycommercial vendor-based offerings, and not individual positions andevaluations for open-source software (OSS) projects, such as KVM andXen. The omission of Xen and KVM as OSS projects follows the samedecision used in the 2010 Magic Quadrant. To reiterate, open-sourceprojects would be penalized in the Magic Quadrant as a consequence ofbeing a community-sponsored development, compared with the specificfinancial and marketing goals of vendors using the same underlyingtechnology. Magic Quadrant positions established for Oracle and Citrix forXen, and Red Hat for KVM achieve higher scores in marketingunderstanding, marketing strategy and sales strategy, compared with theopen-source versions of Xen and KVM. Only skilled organizations that useOSS tools, or customized their own, will succeed without commercialvendor support.

External service providers (ESPs), startups and entrepreneurs who havethe necessary in-house skills can use open source to develop, test,configure, build and maintain their own environments. Since ESPs aremore likely to have the technical skills and shave margins in their servicesand product offerings to keep costs low, they will most likely develop and

deploy their automation tools on a license-free OSS version of thehypervisor.

Users have the choice of selecting either vendor-specific implementationsof virtualization or OSS-community-supported projects, including thetypes of virtualization (OS hosted versus hypervisors) inclusive ofmonitoring and management tools, or a build-your-own approach, withself-maintenance or support of ESPs. The self-maintenance andintegration approach avoids subscription support licenses and vendor

dependencies, but will add to internal support costs if skills are minimal orinfrastructures are poorly implemented, resulting in more-frequentoutages and downtime.

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Dropped

Novell

Attachmate (formerly Novell)

Since last year's Magic Quadrant, we have reconsidered the inclusion ofSUSE (formerly Novell) and decided to omit it. There are several reasons


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or e om ss on:

SUSE originally based its strategic virtualization direction on the Xenhypervisor (since 2003) as part of the SUSE Linux Enterpriseplatform (well before the advent of KVM in 2007), but now offers aricher, heterogeneous, hypervisor-neutral approach to virtualization(with both Xen and KVM).

The evolution of the heterogeneous approach has led to a strategythat is called the "perfect guest," in which SUSE Linux can be

employed as a guest on all major virtualization platforms, as a morestrategic direction going forward.

SUSE has formed alliances with Citrix, Microsoft and VMware todeliver cooperative support of SUSE Linux Enterprise as a guest OSon each of their hypervisors.

The perfect guest virtualization strategy will be targeted as abusiness by delivering management tools above the hypervisorlayer in multivendor, heterogeneous environments.

The Attachmate Group's acquisition of Novell closed 27 April 2011,and has created a separate business unit around SUSE LinuxEnterprise and the former Open Platform Solutions unit of Novell,

while virtualization management has been transferred to NetIQ,another business unit of The Attachmate Group. This represents anorganizational shift from how Novell approached virtualizationmanagement, to an integrated approach expected from NetIQ.

Thus, it is premature to evaluate SUSE's vision and execution (e.g.,marketing, sales, etc.) for the Magic Quadrant until a greater level ofmarket understanding is achieved. Here's what to watch for from TheAttachmate Group's SUSE and NetIQ business units related tovirtualization:

How NetIQ delivers automation tools for virtualization andWorkloadIQ (formerly Intelligent Workload Manager)

How SUSE prioritizes and enhances marketing and sales resourcesfrom its headquarters in Nuremberg, Germany

How NetIQ (Operational VMware Management) will integrate theNovell virtualization solutions as part of its virtualization strategy

How the Microsoft relationship of cross-platform heterogeneity andmanagement progresses for SUSE's and NetIQ's benefits tocustomers

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Evaluation Criteria

Ability to Execute

We evaluated technology providers on the quality and efficacy of theprocesses, systems, methods and procedures that enable IT providerperformance to be competitive, efficient and effective, and to positivelyaffect revenue, retention and reputation. Ultimately, technology providersare judged on their ability and success in capitalizing on their vision.

Abilit to execute in server virtualization is not sim l about roduct


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features, but also very much about maintaining a constantly changingbusiness model in a very dynamic trend. Good products could fail, andpoor products could be very successful, based on effective vendorexecution.

Product/Service: Core goods and services offered by the technologyprovider that compete in/serve the defined market. This includes currentproduct/service capabilities, quality, feature sets, skills, etc., whetheroffered natively or through OEM agreements/partnerships. Key factors

that are evaluated include: range of OSs and applications supported;scalability and efficiency; elasticity; maturity; embedded resourcemanagement; management features to reduce administrative burden;ability to administer the holistic, virtualized ecosystem; administrativescalability; and integration with third-party enterprise managementproviders.

Overall Viability (Business Unit, Financial, Strategy, Organization):An assessment of the overall organization's financial health, the financialand practical success of the business unit, and the likelihood of theindividual business unit to continue to invest in the product, continueoffering the product and advance the state of the art within theorganization's portfolio of products.

Sales Execution/Pricing: The technology provider's capabilities in allpresales activities, and the structure that supports them. This includesdeal management, pricing and negotiation, presales support, and theoverall effectiveness of the sales channel. Customers included are bothenterprises and service providers.

Market Responsiveness and Track Record: The ability to respond,change direction, be flexible and achieve competitive success asopportunities develop, competitors act, customer needs evolve andmarket dynamics change. This criterion also considers the provider'shistory of responsiveness.

Marketing Execution: The clarity, quality, creativity and efficacy ofprograms designed to deliver the organization's message to influence the

market, promote the brand and business, increase awareness of the

products, and establish a positive identification of the product/brand andorganization in the minds of buyers. This mind share can be driven by acombination of publicity, promotional, thought leadership, word-of-mouthand sales activities.

Customer Experience: Relationships, products and services/programsthat enable clients to be successful with the products evaluated.Specifically, this includes the ways customers receive technical support oraccount support. This can also include ancillary tools, customer supportprograms (and the quality thereof), the availability of user groups,service-level agreements, etc.

Operations: The ability of the organization to meet its goals andcommitments. Factors include the quality of the organizational structure,such as skills, experiences, programs, systems and other vehicles thatenable the organization to operate effectively and efficiently on anongoing basis (see Table 1).

Table 1. Ability to Execute Evaluation Criteria

Evaluation Criteria Weighting

Product/Service hi h


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Overall Viability (Business Unit, Financial, Strategy, Organization) high

Sales Execution/Pricing high

Market Responsiveness and Track Record low

Marketing Execution high

Customer Experience standard

Operations low


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Completeness of Vision

We evaluated technology providers on their ability to convincinglyarticulate logical statements about current and future market direction,innovation, customer needs, and competitive forces, and how well theymap to the Gartner position. Ultimately, technology providers are rated ontheir understanding of how market forces can be exploited to createopportunities for providers.

In the server virtualization market, vendor understanding and articulationof the strategic path for virtualization (expanding into the foundation forthe future of infrastructure architecture and operations, and extendingtoward cloud computing) is particularly important and differentiating.

Market Understanding: The ability of the technology provider tounderstand buyers' needs, and to translate those needs into products andservices. Vendors that show the highest degree of vision listen to andunderstand buyers' wants and needs, and can shape or enhance thosewants with their added vision. The market includes enterprises with theirown strategies to build private cloud solutions, and cloud computing

providers.

Marketing Strategy: A clear, differentiated set of messages consistentlycommunicated throughout the organization and externalized through thewebsite, advertising, customer programs and positioning statements.

Sales Strategy: A strategy for selling products that uses the appropriatenetwork of direct and indirect sales, marketing, service, andcommunication affiliates that extend the scope and depth of marketreach, skills, expertise, technologies, services and the customer base.

Offering (Product) Strategy: A technology provider's approach toproduct development and delivery that emphasizes differentiation,functionality, methodology and feature set, as they map to current andfuture requirements. Interoperability between enterprises and serviceproviders (and between providers) is also growing in importance.

Business Model: The soundness and logic of a technology provider'sunderlying strategic business proposition.

Vertical/Industry Strategy: The technology provider's strategy todirect resources, skills and offerings to meet the specific needs ofindividual market segments, including verticals (both enterprises andservice providers).

Innovation: Direct, related, complementary and synergistic layouts ofresources, expertise or capital for investment, consolidation, or defensive

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Geographic Strategy: The technology provider's strategy to directresources, skills and offerings to meet the specific needs of geographiesoutside the "home" or native geography, either directly or throughpartners, channels and subsidiaries, as appropriate for the geography andmarket (see Table 2).

Table 2. Completeness of VisionEvaluation Criteria

Evaluation Criteria Weighting

Market Understanding high

Marketing Strategy high

Sales Strategy standard

Offering (Product) Strategy standard

Business Model standard

Vertical/Industry Strategy standard

Innovation standard

Geographic Strategy low


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Leaders

Citrix and Microsoft have joined VMware in the Leaders Quadrant byincreasing vision and execution respectively. Although market shareleader VMware continues to set the standard in products and the pace interms of strategy, Microsoft has increased its market share (especiallyamong midmarket customers new to virtualization), and Citrix isleveraging its desktop virtualization strengths and its free XenServeroffering to expand its server virtualization share. The road map fromvirtualization to cloud computing is rapidly evolving, and executing will bevery important during the next year as this market continues to rapidlyevolve and grow.

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Challengers

Now that Microsoft has moved from the Challengers Quadrant into theLeaders Quadrant, there are no obvious Challengers on this MagicQuadrant. However, with the delivery of richer functionality, better salesexecution and market share, and increased marketing, Oracle couldbecome the next market challenger.

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Visionaries


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Citrix has increased its execution to move into the Leaders Quadrant. Themost likely potential Visionary is Red Hat, which has begun to talk aboutan expanded vision of virtualization CloudForms and has joinedseveral other vendors in an Open Virtualization Alliance.

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Niche Players

Oracle, Parallels, and Red Hat remain Niche Players in this market.Parallels continues to be a strong choice for service providers focused onhigh-density deployments of specific applications, and it will likelyleverage that strength to expand its offerings over time. Oracle remainsan option for Oracle application and DBMS stacks on Oracle Linux. RedHat is being considered for predominantly Red Hat consolidation andmigration implementations.

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Vendor Strengths and Cautions

Citrix Systems

Citrix is leveraging its position in desktop virtualization to grow itsfoothold in the server virtualization market as the third-place vendor interms of market share. In addition, activations of the free edition ofXenServer have improved Citrix's market share. However, convertingthose new customers to paying customers remains a challenge. In thepast year, Citrix has released XenServer 5.6 and 5.6 Feature Pack 1,including scalability improvements and dynamic memory control.

Key to Citrix's strategy is its ability to leverage a very large and loyalcustomer base of all its products (of which there are more than 200,000).These customers typically use a variety of Citrix products/technologies,with XenApp as the product holding most of the mind share. AlthoughCitrix has been successful selling XenApp, the company recognizes thatthe market opportunity for the desktop is much larger than XenApp canaddress, so Citrix requires a position within the hosted virtual desktop(HVD) market to grow its installed base.

To that end, Citrix offers XenDesktop as an umbrella set of technologiesthat are needed to deliver the desktop; it includes XenApp, ProvisioningServices, XenClient (a Type 1 hypervisor for PCs) and XenServer. Citrix'sstrategy has served it well, since XenDesktop has emerged as the productof choice for most HVD customers. This rapid adoption of XenDesktop hascarried XenServer into VMware-centric organizations. And while VMwareESX continues to be a broadly used hypervisor in XenDesktopdeployments, many enterprises are beginning to question the viability ofsupporting a different VM infrastructure when they could reduce costs byusing XenServer.

Further, Citrix has expanded on its vision for private cloud computing withProject Olympus, its commercial offering of OpenStack. One goal is tobecome the "open" alternative to Microsoft and VMware. However, thereis competition for that mantle, as Red Hat promotes KVM and its own


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In server virtualization, Citrix and Microsoft have a somewhat complicatedrelationship. While Citrix supports Hyper-V and has a long-termpartnership with Microsoft, winning at the desktop hypervisor layer is alsoimportant if Citrix is going to expand its management, automation andcloud business further. As a result, Citrix's go-to-market strategyregarding how it competes with/complements Microsoft remains confusingfor many customers and channel partners. Marketing and sales executionremain key future success factors for Citrix.

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Strengths

Vision for becoming the "open" alternative for virtualization throughto cloud computing

Rich product capabilities for relatively low cost (starting with freeXenServer edition)

Ability to leverage its desktop virtualization market position andinstalled base for XenServer sales

Bundling of XenServer with other Citrix products

Very large and loyal channel

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Cautions

Business model converting free product activations into revenuefor maintenance and management tools

Marketing execution and reach

Open-source software (OSS)-based competition (especially fromRed Hat with KVM)

Continued market and strategy complexity in its partnership withMicrosoft

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Microsoft

Microsoft has been growing market share significantly since its launch ofHyper-V in 2008, and the subsequent addition of live migrations in Hyper-V R2 in late 2009. The company's success has been primarily occurringamong midmarket customers new to virtualization, where it is winning atleast 30% of the time.

One of Microsoft's key strengths its low price is also a weaknesswhen it comes to influencing the channel to promote its product, ratherthan its competition. However, when evaluated objectively, Hyper-V andSystem Center Virtual Machine Manager (SCVMM) usually meet therequirements for midmarket or branch office deployments. In the pastyear, Microsoft has also released Windows Server 2008 Service Pack 1,with enhancements such as dynamic memory for Hyper-V. At theh ervisor and basic administration level Microsoft has closed most of its


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technology gaps with market leader VMware (which tends to have anadvantage with higher-level management and automation tools). Themost significant hypervisor difference continues to be Microsoft's relianceon a parent operating system on each virtualization host which carriesthe benefit of a proven driver architecture, but the burden of potentiallymore planned downtime for patching and maintenance (however,Microsoft's patch record to date for its parent operating system has beengood).

In the past year, Microsoft has begun to lay out a broader virtualizationroad map for cloud computing, including Hyper-V Cloud, which includessome technology, white papers, consulting services and partnerships.While the vision is coming together, Microsoft's Hyper-V customers tendto be smaller enterprises or branch offices in larger enterprises whereprivate cloud computing is less likely to be deployed. Microsoft's challengeto become a leader in private cloud computing will be to convert existingVMware users to Hyper-V and System Center. In addition, serviceproviders are cautious about leveraging Hyper-V for their own cloud-based offerings, given that Microsoft is a major service provider

competitor with Microsoft Azure.

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Strengths

Administrative environment that is familiar to Windowsadministrators

Midsize enterprise installed base of Windows

Strength of solution and price for midsize enterprises

Company financial strength

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Cautions

Difficulty converting or surrounding strong VMware installed base,especially in large enterprises

Competing with VMware for channel and service provider influence

Hypervisor dependence on a running copy of Windows as a parentoperating system

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Oracle

Oracle Virtual Machine (Oracle VM) is Oracle's implementation of the Xenhypervisor that also leverages intellectual property acquired from SunMicrosystems and Virtual Iron. Oracle has been gradually integratingthese technologies into a more coherent and packaged solution but theresulting products haven't been shipped yet. Oracle is converging onOracle VM Manager to manage its virtualization portfolio. This includesOracle VM (an x86 architecture product, based on Xen, which is coveredhere), Oracle VM Server for SPARC (based on Sun LDOM technology),


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VM, storage and other related virtualized infrastructure. This managementunification is an important direction and foundation for Oraclevirtualization products, because it builds an integrated approach to sellingvirtualized DBMS and application server hardware, software solutions,attached storage, and Oracle-based management solutions. Amongcompetitive x86-hypervisor-based solutions, Oracle has chosen to certifyits software solely on Oracle VM. Most of the customer references thatGartner investigated stated that certification was their primary reason forchoosing Oracle VM.

In addition, Oracle favors Oracle VM for software licensing and pricing, forexample, with processor pinning (allowing the specification of a limitednumber of processors being used by a VM, which can reduce softwarecosts). Oracle's corporate strategy is "integrated but open," whichencompasses the company's infrastructure stack. While Oracle solutions

are optimized to work with one another, they still work with supportedthird-party vendors as well. Oracle VM is a solid and maturing solution forOracle-centric architecture, and it is becoming a valuable component of anintegrated Oracle-managed architecture as more management featuresare added. We are receiving a growing number of inquiries from clientsconsidering and using Oracle VM. Several clients have reported difficultiesin migrating and managing storage when using Oracle VM live migration,

but we expect this to be addressed in the forthcoming release.For 2011, we have combined our analysis of Oracle in this Magic Quadrantbased on Oracle VM (predominantly) with Oracle Solaris Containers(specifically for the x86 architecture). There is a large and respectablelegacy installed base running Oracle Solaris Containers predominantly onSPARC, but a much smaller installed base running Oracle Solaris on x86that we focus on for this Magic Quadrant. Oracle Solaris Containers offersa lightweight solution that sacrifices portability and application coveragefor price, ease of use and multiversion Oracle Solaris support. As part ofthe Oracle portfolio, Oracle Solaris Containers offers shared operatingsystem virtualization capabilities for tactical x86 deployments. OracleSolaris Containers provides differentiated benefits for x86 Oracle Solarisusers higher virtualization density, and reduced operational costs due

to fewer operating system instances something that hypervisor-basedsolutions cannot do (however, this technology is available for OracleSolaris on x86 only, and not Oracle Linux). In this sense, Oracle SolarisContainers and Oracle VM can be complementary solutions, targeted atdifferent application requirements.

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Strengths

Preferential licensing and certification of Oracle software usingOracle VM

Oracle's overall software installed base and financial strength

Strong solution in Oracle-managed stack

Oracle Solaris Containers complements Oracle VM as a lightweightalternative to a hypervisor

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Cautions


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Oracle focuses on an "Oracle only" virtualization market and userrequirements

Oracle has been slow to the market with promised productenhancements to Oracle VM (notably Storage Connect)

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Parallels

Parallels Virtuozzo Containers is a shared operating system virtualizationsolution available for Linux or Windows operating systems. It allowsmultiple applications to run in lightweight, separate containers offeringprocessor affinity and memory protection and isolation. Compared withhypervisor-based solutions, Parallels Virtuozzo Containers can reduceoperating system software and administration costs, in much higherdensities. Parallels also offers portability and live workload migration. Thewhole architecture of containers allows a workload and container theability to spin up faster with less performance overhead than VMsolutions.

Originally, Parallels Virtuozzo Containers focused strictly on the serviceprovider market. With the growth of enterprise virtualization, Parallelsentered that market several years ago, without much success. Since lastyear's Magic Quadrant analysis, Parallels has shifted its strategy torefocus on service providers exclusively. This focus has been a populardecision among its service provider customers, who felt that the lack offocus was making Parallels less responsive to their requirements but itis much improved now. As cloud computing evolves, Parallels is positionedwell with service providers, but may eventually need to expand itsfootprint into enterprises building large, hybrid cloud computingenvironments. For smaller businesses that may move more services tocloud service providers, Parallels will need to influence them (throughchannels, service providers, etc.) to move to Parallels-based solutions. For

now, Parallels offers the best solution for service providers building high-density, but isolated, solutions around common workloads, such as Webserving.

Parallels Server 4 Bare Metal which is based on a hypervisor architecture,is not covered in this Magic Quadrant because we have not been able tofind enough references using it. However, Parallels' success withcontainers, and common management and automation tools, creates anopportunity for expansion with Bare Metal in the service provider market.

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Strengths

Unique and innovative multioperating system, container-basedsolution, including live migration and increased isolation

Parallels Virtuozzo Containers is the leading product with acontainers-based solution for service providers

Reduced administrative and operating system software costs, andhigher density compared with hypervisor-based solutions

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Cautions

Importance of an enterprise customer base (and "on-ramp") ashybrid cloud computing evolves

Extends operating system kernel code, which causes the potential

for software errors or conflicts (primarily with Windows)

Dependence by many workloads on a single host operating system

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Red Hat

Red Hat continues to enjoy significant market success in the Linuxdistribution business with a share in the range of 58% in 2010. With itslarge Linux installed base, Red Hat has an opportunity to gain a footholdin the virtualization market. It's taken Red Hat more than seven years tocreate a coherent hypervisor/virtualization solution. Its acquisition ofQumranet in September 2008 an Israeli-based, open-source

development organization for a Linux kernel-based hypervisor was atactically smart move. Until that point, the only viable alternative for anOSS hypervisor was Xen (which Red Hat supported). However, when theXen OSS development team was acquired by Citrix, Red Hat chose to beproactive by acquiring Qumranet and KVM developer expertise, ratherthan following in the path of Citrix (XenServer), which owned the chiefdevelopers. It has taken Red Hat three more years to improve therobustness of KVM for enterprise production use, and to develop a robustand functional ecosystem in which to compete.

Although KVM is getting some platform vendor endorsements (such asfrom IBM), the enthusiasm and strong independent software vendor (ISV)ecosystem, so prominent in driving Linux to worldwide recognition andacceptance, has lagged for Linux virtualization. As a result of the market's

confusion, the slow pace of the ecosystem, superior Unix and mainframealternatives, and Red Hat shouldering most of the marketing burden,Linux virtualization market share, and KVM specifically, has lagged behindVMware, with low single-digit market share.

Since Gartner Magic Quadrants are not predictors or forecast models, theaforementioned comments on timing and penetration reflect a currentposition statement on Red Hat, but not a forecast of future potential. Forexample, on the positive side, Red Hat is endeavoring to raise its level ofvisibility in cloud computing and made an announcement with IBM on 17May 2011 about the Open Virtualization Alliance, which includes BMCSoftware, HP and Intel, among others. We believe that the alliance isrecognition that driving more participation in a Linux ecosystem (insteadof relying only on Red Hat's limited marketing resources) is mandatory tothe growth of Linux virtualization. And if Red Hat's virtualization does notsucceed as the Linux OS distribution and model has, then prospects forLinux as an important cloud building block may also lag, sincevirtualization is nearly a sine qua non of cloud computing. On the otherhand, the alliance is also a very late response to the dominance ofVMware and growing share of Microsoft Hyper-V.

Gartner's client contacts reveal cautious interest in Red Hat virtualization.We are still experiencing relatively low interest levels in Red HatEnterprise Virtualization (RHEV). While this period could still be


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,are more likely to encounter clients that have made commitments toVMware (or others) and are cautious about making additionalcommitments that expand required toolkits and administration skills. We

also detect sensitivity on pricing. Perceptions that OSS should result in alower total cost of ownership (TCO) are being challenged by Red Hat'svirtualization pricing model for guest operating systems. Red Hat's pricingmodel tends to escalate by the number of VMs under support. UnlimitedVM support on four-socket configurations with premium 24/7 support can

more than triple a base RHEL subscription. Red Hat marketing and salesexecution will be crucial in overcoming powerful market players likeVMware, Microsoft, Oracle and Citrix. The lower Red Hat Magic Quadrantcriteria scores associated with marketing and sales execution have beenthe primary causes for the lack of progress from last year's MagicQuadrant.

We reiterate from last year's Magic Quadrant that, by 2012, Red Hat mustshow rapid uptake in upselling its accounts to activate KVM with RHEVmanagement features. The biggest change from last year is that users areless ambivalent about KVM and RHEV capabilities, but are still hangingback from strategic long-term commitments.

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Strengths

Strong and loyal RHEL customer base opportunity (mostlyunvirtualized)

Integrated hypervisor with Linux kernel (e.g., leveraging maturescheduling)

Performance and security

Ease of access and installability

Leadership of the core KVM OSS development community

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Cautions

Limited sales and marketing execution

The majority of virtualized RHEL instances today are running onVMware

Limited ecosystem of tool vendors

RHEL VM guest pricing tiers are inhibitors to rapid market expansion

in the company's own user base

Limited production use of dynamic mobility

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VMware

VMware continues to set the standard in the x86 server virtualization


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infrastructure market, but competition has been gaining share in thisrapidly growing market. vSphere 4.1 was released in 2010, and will bethe last release to support the ESX "classic" hypervisor architecture(which uses a Linux-based service console). VMware has made it clearthat all future releases will require ESXi, which reduces the footprint ofthe hypervisor significantly (reducing the size of the single point of failure,and reducing planned downtime).

With regard to the desktop, VMware continues to expand and deliver on

its existing offerings of View, ThinApp and VMware Workstation. Theintegration of View and ThinApp has provided customers a fairlycomprehensive solution that provides clients the ability to scale HVDdeployments to projects that are larger and more complex than seen inprior iterations of the product. VMware has also articulated its futurevision of the desktop under Project Horizon, which integrates legacyWindows PC functionality with cloud-based applications and servicesdelivered to broader audiences and customers.

VMware has also been expanding the vision for virtualization as a basis fora private cloud, delivering vCloud Director in 2010. While moving up thestack, VMware faces serious competition for new business, primarily in themidmarket, where VMware's features are less valuable, and entry price ismore important. However, VMware seems to be winning at least 60% of

new midmarket customers in large part due to a well-structuredchannel, but also due to strong mind share developed over the past 10years. Except for very small deployments, VMware's price remains high,which continues to be the No. 1 concern customers have with VMware.VMware will continue to be challenged to move up the IT stack intoprivate and hybrid cloud computing for its more-advanced and largercustomers, while, at the same time, competing for new, mostly smaller,customers, whose requirements are less deep.

One emerging area of success for VMware is the cloud infrastructureservice provider market. Thousands of service providers are now usingvSphere, and a growing number are involved in the vCloud initiative.These service providers are trying to balance a desire for differentiationand low cost with access to the large VMware installed base. VMware's

challenge and opportunity is to enable a certain amount of differentiationfor these providers while maintaining a standard for interoperability withenterprise vSphere and vCloud deployments.

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Strengths

Virtualization strategy and road map that lead to private and hybridcloud computing

Technology leadership and innovation

High customer satisfaction

Large installed base (especially among large enterprises), and alarge and growing number of service providers in the vCloudinitiative

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Cautions


17/17



Maintaining revenue growth as its market penetration exceeds 50%,and as midmarket growth drives prices down

Maintaining mind share in the midmarket as competition grows(especially with Microsoft)

Dependence on expansion into new and challenging adjacentmarkets (for example, IT and service automation, applicationarchitecture)

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magic quadrant for x86 server virtualization infrastructure

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