The Virtually Untapped Virtualization Market

Sudha Nagaraj Bharadwaj, Journalist | 11/27/2012 | 8 comments

Sudha Nagaraj Bharadwaj
At the beginning of 2012, most market predictions saw bright prospects for virtualization globally. By all accounts, virtualization seemed to top the priority lists of Indian CIOs, too.

For example, an AMI-Partners study said the virtualization market in India, though at a nascent stage, held significant growth opportunities in the server, desktop, and storage space sectors. Virtual client computing remained on a steady growth path in the first half of 2012 as the industry solutions matured, according to IDC.

Gartner found that activity had intensified in the desktop virtualization space, and the firm predicted that 40 percent of all corporate desktops worldwide would be in a virtual environment by 2013.

In India, the AMI study found that organizations are adopting desktop virtualization to eliminate desktop maintenance costs. In contrast, server virtualization is being driven by the need to reduce capital expenditure, apart from easy data recovery and business continuity imperatives.

IT and IT-enabled services have been early adopters of virtualization, followed by the pharmaceutical, telecommunication, and banking/financial services and insurance verticals. As AMI-Partners said in a press release:

According to leading vendors, the India virtualization market can be segmented into three distinct phases:
Phase 1 -- The end users opt for basic consolidation in order to reduce their capital expenditure. They try to move some non-critical applications onto the virtualized servers.
Phase 2 -- The end users try to virtualize their mission critical or core applications and the entire process is automated.
Phase 3 -- The end users are empowered to focus on self service which in turn improves scalability and performance.

IDC predicts that savings from server consolidation will be invested in new IT initiatives, such as cloud computing, mobility, data analytics, and business use of social media. Thus, virtualization and server consolidation (along with the next natural step, cloud computing) are part of a wider enterprise goal of reducing IT complexity. This becomes very evident in these big-ticket virtualization exercises in the country.

  • Project Panchdeep: India's largest healthcare services organization, the Employees State Insurance Corporation, has deployed 31,000 virtual desktops to deliver healthcare and insurance services at 2,200 facilities. Wipro designed a private cloud infrastructure based on a centralized datacenter (the Cisco Networking Infrastructure and NComputing thin clients). The e-governance project was completed this year.
  • Bombay Stock Exchange: The oldest stock exchange in Asia had three poorly utilized datacenters, legacy servers, and 16 applications when it embarked on its consolidation and virtualization journey. Working with Microsoft to standardize development platforms, the BSE is experimenting with VMware and Hyper-V hypervisors for virtualization. It has focused on consolidating the Windows Intel server farm, which has more than 200 servers, instead of the smaller HP UNIX server farm. With applications being consolidated to six, deployment of a private cloud for noncritical applications, and the consolidation of three database platforms, annual maintenance costs have dropped 20 to 30 percent.
  • Indian Railways: The in-house, centrally administered Unreserved Ticketing System caters to 20 million passengers daily. The system, based on virtualization technology with RDBMS clustering technology, is available in more than 5,000 locations. Over the years, a new design has been introduced with smart clients provided to operators. Nearly 100 ticket types are sold through the system -- based on class of travel, season, concessions for senior citizens and children, and other considerations.
  • Indian Oil: The country's largest oil company, operating 10 refineries, has taken the virtualization route to storage. In this case, virtualization not only makes data easier to manage, but also provides storage capacity on demand. Being a multivendor company, Indian Oil uses virtualization across multiple platforms, operating systems, and applications. It has employed the stripe-and-mirror-everything methodology of storage virtualization to achieve a subsecond response time for ERP and SAP process integration middleware applications for more than 7,000 concurrent users.

These examples present a promising picture of a fast-maturing virtualization market, but it should be remembered that India is a large country that comes with big numbers. Individual case studies are undoubtedly impressive, but the AMI-Partners study found that only 5 to 10 percent of the total IT installed base has been virtualized. There is an untapped opportunity for growth.

View Comments: Newest First | Oldest First | Threaded View
JohnVerity   The Virtually Untapped Virtualization Market   5/30/2013 8:39:36 PM
Re: Penetration and adoption
I would guess that it's simply a lack of experience that might hold back the Indian market. Virtualization is a big step to take. 

Yet, just think how many Indian software engineers must have contributed to the conception and implementation of virtualization, in India and in the US. One day, someone will write a book about this influx of talent and know-how, I am quite sure. The US IT industry wouldnt be where it is without so many Indian engineers working on chips and software and storage systems and you name it. It's a remarkable story. 
Susan Nunziata   The Virtually Untapped Virtualization Market   11/30/2012 1:25:36 AM
Re: Will Cost Savings Increase Hiring
@kicheko. That's encouraging news for the IT workforce. Let's hope the training and retraining opportunities are sufficient to enable people to have the skills that the market demands.
kicheko   The Virtually Untapped Virtualization Market   11/29/2012 7:15:47 AM
Re: Will Cost Savings Increase Hiring
Suzan, - I believe new IT investment requirements will include hiring fresh expertise to handle the changing technology landscape. Further there will have to be a lot of retraining for current staff so as to keep them relevant and well adapted even to handle the virtualization itself.
Susan Nunziata   The Virtually Untapped Virtualization Market   11/28/2012 10:28:43 PM
Will Cost Savings Increase Hiring
As Sudha points out: IDC predicts that savings from server consolidation will be invested in new IT initiatives, such as cloud computing, mobility, data analytics, and business use of social media.

Will these investments come in the form of technology or also of investment in additional hiring of IT personnel?
Skr2011   The Virtually Untapped Virtualization Market   11/28/2012 1:12:25 PM
Re: Penetration and adoption
@Treck

One of the benefits of starting later is that there is less older technology to replace and the need for newer technology such as virtualization  is much greater for disconnected areas

 

That is an excellent point! I do realize how we hold on to older technology because we paid a pretty penny for it when it was new and we are dissapointed when we have to put out more cash to buy the newest thing 18 months on.
David Wagner   The Virtually Untapped Virtualization Market   11/28/2012 12:12:11 AM
Re: Penetration and adoption
@Trek- I do see an advantage to being a late mover (like cellular in Europe versus America with such a good landline infrastructure) but it also means for years they didn't get the benefits early adoptors have gotten. It goes both ways. But i'm excited for the potential of any company or country coming late to the virtualization game to make real strides because they can use the lessons we've already learned and combine it with their own sense of innovation and push the envelope.
Trek   The Virtually Untapped Virtualization Market   11/27/2012 4:00:26 PM
Re: Penetration and adoption
India is adopting technology much faster. One of the benefits of starting later is that there is less older technology to replace and the need for newer technology such as virtualization  is much greater for disconnected areas.  India is essential jumping a generation in technological advancement.  One of the reasons is that India is such a ripe playground to invest and test new technologies from virtualization, clean energy, clean water, inexpensive lap tops and telecommunications. Much is owed to changes in government policies that has allowed outside investors more room to wiggle around. 

 
impactnow   The Virtually Untapped Virtualization Market   11/27/2012 12:36:05 PM
Penetration and adoption
 

I personally think virtualization offers tremendous benefits what do you think is preventing a wider adoption in India?


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