Estimating Virtualization Market Size and Capacity for Future Growth

Estimating Virtualization Market Size and Capacity for Future Growth
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Physical servers consist of hardware, an operating system and applications. Traditionally companies install a server for each of the roles they need. Mail servers, print servers, domain controllers, file servers, database servers and application servers are examples of the types of systems organizations install. Each server needs its own power supply, network connection, data storage, processor and memory.

Virtualization is when several servers are installed on a single piece of hardware but each one operates independently of the others and behaves as if it were the only operating system on the physical hardware. Special software called the hypervisor controls how each operating system and application works with the physical hardware and ensures that they do not conflict with each other.

Why Virtualize?

A number of benefits arise from virtualization. Each physical server in a data center draws power and takes up space. With virtualization, several computers can operate in the same physical space as one server. The single physical hypervisor uses less power than all of the virtual servers combined if they had to be real servers.

This allows the data center operators to consolidate physical servers by virtualizing them. This frees up space for other resources and consumes less power from the physical plant. Another benefit of virtualization is cooling. In traditional data centers, large air conditioners keep hundreds and thousands of servers and devices cool. Consolidating these servers by virtualizing them results in less stringent cooling requirements saving even more power. These factors help drive the growth of the virtualization market.


Several companies make virtualization software. VMware provides a hypervisor technology known as ESX. The current version of the software is vSphere. Microsoft also makes virtualization software. Their offering is known as Hyper-V. Both applications have expensive hardware requirements but can run dozens or more virtual machines at the same time.

Xen is a free, open source hypervisor product. This software runs on free or commercial versions of Linux providing smaller companies with the means to expand their use of virtualization. Solaris, Parallels, and Citrix each provide their versions of virtualization software to the public for use as well. With the growth of the virtualization market each vendor has found a place for their products.

The Future of the Virtualization Market

According to the IDC the virtualization market size grew 46 percent in 2007. It grew an additional 54 percent in 2008. Growth slowed to 43 percent according to studies by Gartner but still equated to $1.1 billion in revenue for virtualization vendors. Gartner indicates that the new market for hypervisor vendors is the hosted virtual desktop. Instead of virtualizing servers, the desktop used by everyday employees are being virtualized.

In 2008 hosted desktop virtualization revenues were $74 million. In 2009 those revenues were measured at $298 million. Eleven percent of corporate desktops were virtualized and Gartner expects future growth of the virtualization market to increase significantly through 2013 for this segment.


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Virtualization growth rising from 46% in 2007 to 54% in 2008,

Gartner Says Worldwide Virtualization Software Revenue to Increase 43 percent in 2009,

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