VMware pricing

Virtualization Competitive Analysis in the middle of an ROI Calculator?

Microsoft recently published their Integrated Virtualization – ROI Tool, and I thought “That’s great. When the time comes I will have the ability to provide Microsoft branded reports to support a Microsoft virtual infrastructure opportunity.” I did not take the time to check out calculator first, but I assumed (or hoped) that it would provide clear answers about licensing costs and the confusing licensing options for virtualization. It wasn’t until I read VMware’s post Microsoft’s Virtualization ROI/TCO Calculator: Our Take that I decided I’d better understand what Microsoft’s ROI calculator produced.

Specifically, VMware’s post asked me to consider the inaccuracies they found:

“… evaluate the Microsoft calculator yourself – let us know what else you find! “

So I did just that, but it wasn’t how Microsoft calculated the numbers that bothered me most. I struggled to understand why a TCO and ROI calculator included a competitive analysis. After all, VMware’s TCO calculator doesn’t compare the cost of competitor’s products. What does that have to do with return on investment? It just seems out of place to me. Furthermore, if you go back and review VMware’s points they are mostly about the competitive cost comparison, too. It’s easy to forget we are discussing a TCO / ROI calculator.

As for using the calculator for ROI, it’s fine, I guess. But it did not live up to my basic expectations of helping with licensing. In fact, intentional or not, Microsoft comes across as trying to hide accurate licensing costs, as VMware points out:

“We did find a one-line disclaimer buried in the 66-page document: “Warning – Check pricing advice and rules as the automated recommendations here may not reflect all licensing rules.” Come on, guys - licensing is such a basic component for accurate TCO estimates. The disclaimer feels pretty weak.”

On the other hand, I think I can use the Windows Server Virtualization Calculators to help estimate licensing costs. But I shouldn’t have to use another calculator to verify the first one. Overall, I am left with the same feeling I get when trying to buy a new car. It’s similar to that doubt about the “dealership transport” charges or the frustration of feeling that I’m missing hidden costs even though the price is right. I am being forced to do way too much research.

I understand that the next few years will be filled with explaining the technical and financial differences between Microsoft, Citrix, VMware and all the other virtualization products. A competitive analysis calculator would come in handy. A single, unbiased virtualization competition calculator might be impossible to create, but even separate tools from each vendor that let you enter your own pricing numbers would be a great start. Call these tools what they really are. Don’t hide them in an ROI Calculator.

VMware releases management and automation products, new bundles

Palo Alto-based VMware, Inc. made three product announcements today; its disaster recovery software, VMware Site Recovery Manager will be available for orders next week, VMware Stage Manager will begin shipping May 19th, and these products will also be available as part of two new management and automation software bundles from VMware starting May 19th.

Site Recovery Manager
VMware Site Recovery Manager, which provides integrated management of disaster recovery (DR) plans with VirtualCenter, offers automated DR plan testing, failover and recovery.

Jon Bock, senior product marketing manager for VMware, said that Site Recovery Manager should allow users to implement DR plans where they could not do so before.

“Because of cost and resources required for DR, disaster recovery has only been done for mission critical applications, but virtualized workloads can be protected with minimal cost and effort,” Bock said.

More and more companies have started virtualizing mission critical workloads, as VMware has been quick to point out.

The company presented a number of case studies showing companies like Milwaukee-based Johnson Controls Inc., which uses virtual machines (VMs) for “almost everything” including its Microsoft SQL database, EMC Corp.’s Documentum, and Active Directory, with success.

Companies virtualizing those types of apps should use DR capabilities from software like VMware’s to protect those applications during disaster.

Midvale, Utah-based Burton Group analyst and virtualization expert Chris Wolf explained in a tip recently that Site Recovery Manager makes disaster recovery planning and execution simple.

“With Site Recover Manager, you can automate your disaster recovery plan with software, initiate that plan with a mouse click, and pre-program the sequence in which VMs are brought online at a disaster recovery site,” Wolf wrote. “During the course of this year, I expect other vendors to offer similar technologies as well.”

Stage Manager
VMware Stage Manager automates the process of moving application environments through release stages — from integration to testing to staging and to user acceptance — before being released into production.

Stage Manager, which was highly acclaimed during its beta phase, is also managed by VMware Infrastructure 3. It aims to reduce time spent on configuring hardware and prevent virtual machine sprawl, which commonly occurs when virtual machines are released across the data center for staging, Bock said.

New management and automation bundles

VMware has designed two new software bundles that include the management and automation products now available. The VMware IT Service Delivery Bundle includes all of VMware’s IT lifecyle automation products, including VMware Lifecycle Manager, VMware Lab Manager and VMware Stage Manager.
The VMware Management and Automation Bundle includes all of the above, plus the disaster recovery product VMware Site Recovery Manager. It is priced at $2,995 per two processors.

The new Management and Automation Bundle includes all products from the IT Service Delivery Bundle with the addition of VMware Site Recovery Manager, priced at $3,995 per two processors.

Both software bundles will be available form VMware distributors, resellers and OEMs beginning May 19.

A showdown for your VDI investment?

Virtualization expert Barb Goldworm has been banging the desktop virtualization and application virtualization drum for a while now. She contends that there is still a lot of innovation to be had in this space and that businesses are poised to reap the benefits, despite pushback from execs. It’s a symbiotic relationship, however, between IT departments and virtualization vendor. In other words, an opportunity for a business to virtualize some aspect of their infrastructure translates to an opportunity for a vendor to sell that virtualization product.

But how do you choose which vendor will fulfill that need? Chances are if you’re on this site, you’re either deeply invested in VMware, or about to become deeply invested, and will probably choose VMware Virtual Desktop Infrastructure (VDI) for your desktop virtualization needs. For the time being, that’s probably a smart decision for you. It’s also a good thing for VMware, which is positioned to recognize Goldworm’s assessment and to take advantage of the opportunity in the virtual desktop space.

In a recent interview with SearchVMware.com associate editor Hannah Drake, VMware expert and author David Rule agreed. “Virtual desktops is where VMware is going to see a huge surge of revenue. Take a company that has 1,000 servers, that’s 3,000 - 4,000 users. Ten percent of number is a huge amount of net new [virtual desktop] licenses,” he said. Furthermore, Rule believes that investment to be sound because they’re already ahead of the game. In his view, VMware will remain the virtualization technology market leader. “VMware is the innovator in the marketplace. Citrix and Microsoft haven’t brought anything new to the market that VMware hasn’t.”

He’s right, at least in comparison with Microsoft desktop offerings. Virtual PC is more of an emulator than an enterprise virtual infrastructure for distributed computing, and it might take a while to see how Microsoft’s acquisition of Kidaro pans out. In the meantime, VMware is going to have to look out for Citrix’s offering, XenDesktop, according to virtualization guru Chris Wolf. As the major player in the thin-client space, Citrix has the shortest to go in order to compete with VMware VDI and ACE. In fact, Wolf noted during a recent interview with Drake that at last week’s Microsoft Management Summit, when customers asked Microsoft about desktop virtualization, Microsoft reps said that they [don’t] have any current offerings but “strongly recommended Citrix XenDesktop” to their customers.

But Microsoft recommends XenDesktop for good reason. “Citrix has put a lot of work into Xen virtual desktop, and they don’t try to compete with Microsoft. They’ve been working towards interoperability from day one. I can run a VM on Hyper-V, power it down and run the VM on XenServer. I might have to change some device drivers, but I know it’ll run fine for me,” he said, adding that VMware has a lot to learn in terms of backend architecture. “From a scalability perspective, the XenDesktop architecture is a better architecture on the backend. If you look at the VMware line moving forward there will be substantial enhancements for virtual desktops, especially with storage and sharing virtual images.”

But what about price point? It turns out that the lackluster economy may turn out to be the wild card forcing change in the desktop and overall virtualization market. According to Wolf, virtualization price will play a bigger role in determining market leadership than some experts have predicted:

“For your average organization, it’s not just about feature for feature comparison, which VMware is always going to win. It’s about what is good enough, and what can I do with my IT budget, especially in [what is] arguably a recession right now. Price becomes a major consideration in purchasing decision. If I can get by with a product, then that’s going to be a compelling reason to look at that product. For VMware to maintain their market dominance, they have to lower their prices. There’s just no other way around it right now.”

Will VMware drop its prices this year? Only time will tell. We’ll continue to follow the virtualization price war; stay tuned.

VMware expert sounds off on 3i, Hyper-V, XenServer

SearchVMware.com recently spoke with VMware book author and expert David Rule about his latest book, How to cheat at configuring VMware ESX Server. (Check out Design is key to VMware implementation success, expert says for the main interview and a free chapter download.)

The main interview covered security, management tools and best practices for implementation, but there was some other strong material about VMware 3i, Microsoft Hyper-V’s potential affect on VMware adoption and how Citrix plans to gain a better foothold in the marketplace with XenSource, so we decided to include them in this supplementary blog post.

SearchVMware.co: Do you think VMware 3i is VMware’s answer to the problems with the service console (patches, security vulnerabilities, etc.)?

Rule: Yes, and I think 3i is a great product for a variety of reasons. It’s a simpler, lighter footprint on hardware, which in turn gives better reliability and performance.

Do you think Hyper-V will detract from VMware’s customer base?

Rule: I don’t think there’s a compelling enough reason to move from one platform to another. From our internal lab testing, as well as customer feedback, I can say there’s more interest than there used to be in Microsoft, but the main issue is supportability. For at least the next 12-18 months, VMware will remain the market leader. 18 months out we may see more competition. But even looking at the long term, VMware is in a pretty good position because of their current stronghold in the market.

On the other hand, I have seen a few customers here within the last one to two quarters that don’t have any virtualization in place. Microsoft does come up more in conversations with new adopters than it used to.

Given the low licensing cost of Hyper-V, do you think VMware will have to alter its pricing?

Rule: At least with our customers, I don’t see a lot of push back on VMware licensing just because of the amount of consolidation you can get. At a 10:1 consolidation, you’re saving the customer so much it becomes a non-issue. VMware may have to focus on the business approach, and focus on, say, in a 1,000 server data center, here’s how much we can help you save. It’s really going to be about VMware and VMware-partner marketing.

Do you think Citrix XenServer will become a bigger contender?

Rule: A lot of it hinges on Citrix bringing their solutions together. Xen had good momentum behind it in the marketplace. People that didn’t like the VMware licensing, such as smaller size SMBs or those who used virtualization for test and development, liked XenSource. So, Citrix has brand recognition. If Citrix can meld their application and desktop virtualization products together, that’s going to be their strength. And, actually, that’s the direction they want to see things go.

Citrix has two focuses: people that aren’t doing virtualization at all yet, and their core customer base from Presentation Server. They’re taking on more of a grassroots campaign. It would be a tough sell with accounts that don’t currently have a Citrix install base.

How do you think VMware will remain competitive?

Rule: They’re going for continual add-on business, net-new accounts and the licenses they’ll bring in. You’ll see movement with virtual desktops and Site Recovery Manager. But virtual desktops are where VMware is going to see a huge surge of revenue coming in. If you have 1,000 servers, that’s 3,000 - 4,000 users. Just 10% of that is a huge amount of net-new licenses.

VMware’s competitive edge shrinking in light of Hyper-V hype, experts say

My Digg reader kicked out a great RedmondMag.com interview with VMware’s “product guru” Raghu Raghuram today in which he discusses the company’s product philosophy and how it translates to the VMware product line. During the interview, Raghuram says that there is a “stark difference” between Microsoft’s and VMware’s approach to virtualization. He had this to say about how he positions VMware ESX Server against Hyper-V:

Our view is that the core virtualization layer belongs in the hardware. It also has to be much smaller in order to reduce its surface area for attacks. This is why we introduced the 3i architecture . . . The Microsoft approach is to have virtualization be an adjunct to the OS . . . With the Hyper-V architecture, they’re still maintaining the same dependency on the OS.”

VMware ESX and Hyper-V are both bare metal virtualization products. To belabor an explanation, this means that they both sit in a thin OS layer abstracted from the hardware. This veritably eliminates hardware dependencies. However, Raghuram seems to be suggesting that Hyper-V is more of a hosted virtualization approach. This could be a misunderstanding on his part, questionable editing, or just a case of Microsoft being Microsoft.

At any rate, one difference that is certain can be logically approached when considering ESX versus Hyper-V. Something that virtualization expert Andrew Kutz said at a recent virtualization seminar keeps flashing in my mind. In his (and others’) view, Hyper-V will be the virtualization vendor to beat. This isn’t because Hyper-V is particularly a better product, but because VMware can’t compete with Microsoft on the level of supporting applications and interoperability.

In other words, after years of development and being the big guy in the computing space, Microsoft has a support cloud of applications and services all designed to work together that VMware will need to emulate in order to remain the leader in enterprise virtualization. This remains to be seen. But especially considering the low Hyper-V price tag ($28), VMware must be prepared to counter, at least with lower pricing.

Why VMware ESX/VI3 will stay best in production and price, even after Viridian

Last summer I wrote about an IT manager’s virtualization platform decision on Server Virtualization Blog, and bloggers took great exception to the fact that the user had chosen Microsoft Virtual Server over VMware ESX.

The general opinion was that the user was misinformed and misguided, and ESX users were quick to point out why. On the other hand, on his blog Scott Lowe summed up the pragmatic readers’ view, which goes something like this: If you’re looking for a no-frills, non-production virtual machine platform, then freebies like Microsoft Virtual Server and Vmware Server are right up your alley. Their simplicity also suits that functionality picture. If you are moving upstream, however, paying the price for a production-level platform is the best option, and Vmware ESX is arguably the best option these days.

Recently, I got an update on today’s ESX versus the other virtualization platforms scenario from a Microsofft MVP, Steve Kaplan, and his cohort, Bryan Dickson, both of system integrator and Vmware consulting firm AccessFlow Inc. Kaplan said:

Virtual Server runs on top of a 150-million lines-of-code Windows 2003. This inherently has the performance, reliability and security limitations of a fat underlying operating system. It misses essential features for an enterprise data center platform such as four-way SMP, 64-bit guests, 16GB memory per guest, VMotion, High Availability, Distributed Resource Scheduling, centralized management, etc. Microsoft realizes the limitations of VS [Virtual Server], which is why it has made the product EOL, and why Microsoft is coming out with an ESX-like hypervisor, Viridian. But Viridian is going to be comparable to ESX 1.0 (2001).It is going to lack many of the features and industry support that make ESX the standard.

By comparison, ESX is 150K lines of code – it is extremely robust and secure. It is also supported by nearly every major hardware and software manufacturer on the planet. And, far from being a deterrent, the hundreds of third-party manufacturers building .vmdk compliant virtual appliances are adding enhanced capabilities around storage, backup, firewall, etc. that are simply not available in the physical realm.

Kaplan has more to say about price performance in the article, Should VMware lower pricing of ESX Server?

Moving upstream brings benefits and added costs, said Dickson, but the pay-off is greater, too. He said:

Yes, ESX3/Virtual Infrastructure I3 is more expensive, and it is more complicated to administer [due to] it’s extensive feature list. I am sure the consolidation ratios and administration time, and feature benefits would more than make up the difference in cost. We have never seen a customer not realize a strong ROI in a short period of time. You can get much more with VI3 while still having a positive ROI.

I’d like to hear from more IT pros about whether ESX/VI3 give good ROI and whether Microsoft is going to be playing catch-up in the virtualization market for years. Will Microsoft’s traditional play of lower cost and almost-as-many features work put Viridian into more production environments, and will that be a good thing? Comment here, please, or write to me at jstafford@techtarget.com.