Virtualisation, which uses software to consolidate servers, is a key trend and a money-saver we'll be hearing a lot about in future, writes Karlin Lillington

Perhaps one of the oddest major trends right now in business computing is hardware manufacturers advocating that their customers buy less of what they make.

The trend's name is virtualisation: using special software to create self-contained partitions within a single server that allow multiple operating systems (OS) to run on the same server box. They appear, and act like, multiple servers but without the added hardware.

Take Dell, for example.

"People are beginning to realise that throwing more systems at a problem isn't the answer," says Victor Smith, enterprise technologist, advanced systems group, Dell, who preaches the advantages of virtualisation.

Excuse me? Isn't this Dell, server and PC manufacturer? Smith laughs.

Yes, but Dell is also a services company these days, and is ready to help companies virtualise and then offer support for their virtual network, a rapidly expanding area of business.

How big? Smith won't give details, but says: "It's now a fairly sizeable chunk of our services offering." He adds: "According to [ analyst] Gartner, you'll be virtualised. It's only a question of when it will be happening. And if we don't give support to our customers, the possibility is they could go out of business because their competitors have virtualised. We need to be there, and to be their partner. It's true for all the OEMs [ original equipment manufacturers, the industry shorthand for computer makers]."

Virtualisation isn't a totally new concept - it is just relatively new in the Windows/Intel world. Mainframes have been able to virtualise for several decades and Unix servers have also been running virtual environments for some time. But the ability to virtualise on Intel chips running Windows, with Windows' enormous presence in the business sector, means the cost savings speak to many more organisations.

Energy has itself become a big topic for organisations in the past year as energy costs have jumped worldwide. Companies like Sun have based major advertising campaigns on the "green" operating efficiencies of their hardware, but virtualisation software is also touting its green credentials.

Virtualisation offers significant energy costs savings because it enables a more efficient use of hardware. A typical server only utilises about 15 to 20 per cent of its processor's capacity while running. Yet the operating cost of a server remains fairly steady at about $3,000 (€2,279) a year to run a single server in a data centre environment.

Some 30 per cent of operating cost is for powering the information technology elements within the server - the parts that do the actual computing. Another 45 per cent of operating costs go on cooling the system, which generates a lot of heat.

Using virtualisation software by companies like VMWare or open-source option Xen, one server can do the job of many, with all the OS sharing hardware resources like the processor.

Virtualisation software works by creating a program called a hypervisor or a virtual machine monitor (VMM) that can run directly on the hardware or on top of an operating system like Windows, Unix or Apple's MacOS. The VMM creates and controls the virtual environments, or virtual machines, that can each run a different operating system, or different copies of the same operating system (eg five virtual Windows environments). The VMM talks to the hardware and is the go-between for commands sent to the virtual operating systems.

Along with the energy and cost savings of enabling multiple environments to run off a single server, the single biggest driver for virtualisation, according to Smith, comes from improved and simplified disaster recovery capabilities. Systems back themselves up and can easily be transferred, in real time, to a new virtual environment on the same or a different server.

Smith points out that this also means system updates and general management can be done during normal business hours rather than out of hours, because normal business operations can continue to run on some virtual environments while others are being updated.

Selling one server instead of five to run those environments means the OEMs take a hit on server sales, but service contracts are a far more lucrative end of the business anyway, so the trade-off is not as painful as it might at first seem, say analysts.

Sound too good to be true? Perhaps. On one hand, all major analyst firms are citing virtualisation as a key trend and a money-saver for businesses of many sizes. On the other hand, as often happens with a new technology, it is perhaps suffering from over-hype at too early a stage of its development and implementation.

One study by analyst Info-Tech Research on more than 30 Canadian businesses that have virtualised, concludes many vendors have made claims for the technology that do not hold up.

A main conclusion of the report is that vendors are exaggerating the number of servers that can be consolidated.

What is virtualisation?

Identified as one of the hot areas in business software for next year by analyst IDG, virtualisation is the creation of virtual environments, within a server, that allow more than one operating system (OS) to run alongside each other - or multiple copies of the same OS.

To other computers or users of a network, each virtual server appears to be an additional, self-contained server running its own operating system.

Practically every large hardware and software vendor is involved to some degree in the push towards virtualisation - IBM, Sun, Dell, Intel and the virtualisation software leader VMWare among them.

And it isn't just servers and operating systems; storage is also being virtualised as well.

With so much coming on offer in this area at the moment and into the early part of next year, IDG expects the market to take off in 2007, helped by the continued fall in the cost of hardware coupled with concerns about the high energy costs of running hardware.

Expect major ramifications across the industry.

In particular, expect changes in the way software and hardware are priced and sold.