Few things can turn a blue ocean into a small pond like Microsoft Corp. wading into the market. In late January 2008, the software giant stepped up its virtualization strategy by purchasing Calista Technologies, deepening its relationship with virtual services powerhouse Citrix and leading to a drastic reduction in pricing its Vista Enterprise Centralized Desktop (from $78 to $23 per seat). Why the big merger and marketing moves by the world's largest software company? Simple -- for many reasons, virtualization is being touted as the future of IT.
Virtualization is a catchall term that describes a more efficient method of using IT hardware resources by using software -- commonly known as a "hypervisor" -- to create several virtual machines within one piece of hardware. Manufacturing executives can picture it as being roughly analogous to the IT equivalent of machine utilization rate, a metric that is a crucial barometer of operational productivity. By maxing out existing hardware, virtualization can reduce capital spending, as well as reduce the amount of energy consumed by increasingly power-hungry IT departments, thereby reducing total cost of ownership. In a recent Harris Interactive survey, 41% of corporations have deployed virtualization or server consolidation strategies to save on energy costs.
Similarly, because virtualization typically only involves configuration and not installation of equipment, it can give IT departments both on the plant floor and in the front office a quicker, more flexible resource setup process. In some enterprise settings, entire fleets of desktops and laptops are being phased out in favor of servers running virtualized machines, reducing or even eliminating the need for continued capital investment.