IDC: Virtual servers set to overtake physical boxes

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Sally Whittle ZDNet.co.uk

Published: 15 May 2009 16:02 BST

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IT departments in Western Europe will deploy more virtual machines than physical servers for the first time this year, according to a new report from IDC.

The research company found that the number of physical servers shipped in 2008 fell by a quarter, compared with 2007. Over the same period, the proportion of servers shipping with a virtualised platform grew by 26.5 percent, IDC said in its report, published on Thursday.

"We expect to see this trend continue, and there will be a break point this year, when shipments of virtualised servers will actually be 10 percent higher than physical server shipments," said Giorgio Nebuloni, a research analyst with IDC European Systems and Infrastructure Solutions. "By 2013, the ratio of virtual to physical machines in a typical datacentre will be 3:2."

For IT managers, virtualisation offers a quick way to cut capital expenses, since it's possible to buy one virtualised server with more memory in place of four smaller, physical servers. At the same time, vendors such as IBM, HP and Fujitsu see virtualisation as a way to protect fragile profit margins.

"If your physical shipments are seeing a double-digit decline, then it makes sense to push bigger machines that have more software and services attached to them. In some cases, companies like VMware are seeing revenue increase, despite the overall number of server shipments shrinking quite dramatically," Nebuloni said.

Vendors are increasingly shifting server design towards virtualisation-friendly architectures, while new players are also entering the market, hoping to exploit the potential of fully virtualised x86 environment, Nebuloni added.

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