APAC virtualization market on a high

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APAC virtualization market on a high

Virtualization software and services market to touch $1.35 billion by 2010, says Springboard Research

Monday, March 31, 2008

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NEW DELHI, INDIA: The virtualization software and services market in Asia Pacific is estimated to reach $1.35 billion with CAGR of 42 per cent by 2010, according to IT market research firm Springboard Research.

Virtualization services is estimated to touch $1 billion by 2010 and will form the major portion of this market as organizations will spend two to three times more on services than on software.

According to the research, 50 per cent of CIOs want to deploy virtualization solutions over the next 18-24 months to address issues like low system capacity utilization, poor performance and other challenges associated with managing growing IT infrastructure.

The report is based on a survey of CIOs from large and mid-sized enterprises in Australia, China, India and Singapore.

"Our research indicates that virtualization, at least at the server level, is becoming an imperative and that a growing number of companies will implement virtualization at the server level in 2008," said Michael Barnes, vice president - Software Research at Springboard Research.

"The complex nature of engagements with vendors and SIs while implementing virtualization solutions is a prime reason for virtualization services taking a larger share of the market," he added.

Market dynamics

On the software side, VMWare is the Asia Pacific virtualization market leader with an estimated 70 per cent market share, while Microsoft, Parallels, Virtual Iron and XenSource are other players with significant presence.

IBM, HP, Dell and Sun dominate the virtualization services market.

Australia and Korea lead the virtualization marketplace in Asia Pacific due to their well-built infrastructure, while Taiwan, Hong Kong, China and India are high growth potential markets.

Growth challenges

Although some Asian CIOs understand the benefits of virtualization, many organizations are unsure how to approach its implementation.

Additionally, many CIOs view virtualization technologies as immature and feel that implementing the technology could introduce new management and security challenges.

Virtualization is also primarily viewed from a technical perspective and most CIOs do not link virtualization to solving business problems.

"There is clearly a need for more customer education on the benefits of virtualization – followed by education on different approaches to successfully incorporating virtualization into the IT environment," said Ravi Shekhar Pandey, senior analyst at Springboard Research.

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