Events in April suggest that Microsoft may be facing a growing crisis in a key software market. It is not the desktop operating space, where Vista’s first sales helped the client division grow its operating profit contribution 70%, or the server operating system market, where Microsoft scotched rumours that this year’s arrival of ‘Longhorn’ would be delayed.
Instead, two recent Microsoft statements have added to the perception that it is struggling in a market that could ultimately have a negative impact on both those operating system cash cows – the virtualisation software sector.
The first of these statements, quoted in the New York Times, was Microsoft CEO Steve Ballmer’s belligerent promise to “compete aggressively with VMware”. The remark confirmed what many observers already knew – that the EMC subsidiary’s towering leadership of the x86 virtual machine software market is starting to worry Microsoft.
More recently, Mike Neil, Microsoft’s general manager of virtualisation technology, used the company’s server division weblog to reveal that, “the public beta 3 of Windows Server virtualisation [code-named Viridian] will ship in the second half of 2007, not the first half as previously disclosed.” This appeared to confirm what some customers and analysts may already have suspected – that Microsoft’s efforts to try to match VMware’s technology may take longer than expected.
The fast growing market for virtual machine software has emerged this year as a potentially de-stabilising force for all vendors active in the x86-based server market. In March, market research organisation IDC cut its projection for server unit shipments in the period 2006 to 2010 by 10% (some 4.5 million units valued at $2.4 billion), citing the impact of virtualisation software that allows customers to consolidate applications on fewer, but bigger machines.
This trend has obvious repercussions for vendors of commodity processors, but as the premier supplier of operating systems to this sector, it also has implications for Windows sales, which have still to match Linux and Unix installations on larger machines.
April’s beta release of Longhorn contains features, such as its ‘Powershell’ management automation utilities and Internet Information Services 7.0, that may help Microsoft in its battle with the Linux. However, according to analysts such as Forrester Research’s Chris Voce, it is becoming de rigueur for data centre-class servers to run multiple operating system instances simultaneously. Hence, he believes, “virtualisation will be key to Longhorn’s success.”
Hypervisor wars
Microsoft already offers customers virtualisation capabilities with Virtual Server 2005 which allows customers to run multiple operating systems on a single physical machine. However, this stops short of matching the capabilities of hypervisor based virtualisation products from VMware and XenSource. Microsoft’s own hypervisor technology – said to be heavily based on XenSource’s para-virtualisation technology – was supposed to receive its first public airing in the now-delayed public beta of Windows Server virtualisation.
The longer customers are forced to wait for Microsoft’s hypervisor technology, the more some will be tempted to throw in their lot with the company’s competitors. In the meantime though, the company is fighting back by promising that, when it arrives, Microsoft’s hypervisor technology won’t merely match its competitors’, it will be supported by features that make it a much easier technology to integrate with their existing data centre resources.
Even before the announcement of the latest delays to Microsoft’s virtualisation products, its executives have been stressing that enterprise-class virtualisation is about more than just hypervisor technology and, in particular, that hypervisor- based approaches to virtualisation bring with them as many potential problems as they do benefits.
“Virtualisation increases complexity, and by definition complexity makes for more risk,” said Bruce Lynn, head of Microsoft’s server business group in the UK. “What the hypervisor does is that it exposes more [underlying physical resources] to developers. That’s good. But you are also opening up the possibility for new vulnerabilities,” he says.
Microsoft’s view, that a headlong rush into a hypervisor driven virtualisation strategy would be a mistake, hasn’t gone unsupported in the market. Analysts broadly agree with the assertion of Neil Sanderson, Microsoft’s UK management product and solutions manager, that “customers shouldn’t have to change the way they manage their systems to deploy virtualisation.”
For this reason, “people shouldn’t think we’re not taking virtualisation seriously. We’re working to ensure that when it arrives, it will work seamlessly with existing management software – with SMS [Systems Management Server] and MOMS [Microsoft Operations Manager,” says Sanderson.
Once again, however, the burning question in many customers’ minds is, ‘when?’. Microsoft began talking about ‘Carmine’, an enterprise-class management solution for virtual machine environments, roughly this time last year. At the time, Microsoft outlined plans for a virtualisation console that would offer drag-and-drop physical-to-virtual machine conversion, “intelligent placement” of workloads and support some degree of automated machine/application performance optimisation and resource prioritisation.
Since then, little more has been heard of Carmine, except that it has now been formally named Systems Center Virtual Machine Manager (SCVMM) and hence, apparently, linked to the delivery of Windows Server virtualisation (Viridian).
If, as its critics claim, Microsoft is attempting to exploit the power of FUD – fear, uncertainty and doubt – to hold-off its competitors, it can’t be said to be doing an especially good job of it. Since Microsoft aired its plans for Carmine, VMware has forged ahead with VirtualCenter, its own virtual machine management platform, introducing 4-way SMP support, distributed resource management and distributed availability services that Microsoft has yet to match, as well as enjoying great market interest in VMotion, its dynamic virtual machine migration utility.
Nor is it just VMware which is filling in gaps that Microsoft’s talk of Carmine has helped to highlight. XenSource, Microsoft’s hypervisor partner (and a company that Microsoft was an early minority investor in) is also forging ahead with virtual machine management utilities, competing in an increasing crowded and innovative market space with other emerging players, such as Virtual Iron and DataSynapse.
Some of these competing products like Data Synapse’s GridServer and FabricServer application virtualisation tools are now emerging from test and development installations to drive some of the industry’s flagship virtualisation installations, such as Credit Suisse’s admired enterprise grid deployment.
Will do, can do
So is Microsoft in danger of offering too little too late? Or is there sufficient pent up demand for Longhorn to provide the breathing space Microsoft needs to catch up with its virtualisation competitors?
The evidence so far suggests that while VMware is the clear market leader today, Microsoft’s race is far from run. In announcing the recent rescheduling of Viridian and Virtual Server 2005 R2, Mike Neil was able to whet his audience’s appetite with promises of simultaneous support for 64 virtual machines (VMs) on 32-bit processors, and an impressive 512 VMs on 64-bit chips when the service pack 1 version arrives.
Since then, Microsoft has drawn another rabbit from its virtualisation hat, with the news that SCVMM beta 2 will be available for download this month. Made as Information Age went to press, this announcement shows that Ballmer’s threat to compete “aggressively” with VMware is not an empty one, and that virtual machine management is the ground that Microsoft wants to defend.
Indeed, in a recent post to Microsoft’s server division weblog, the senior manager in Microsoft’s server product group, Patrick O’Rourke, made it clear what SCVMM is all about. The System Center team created SCVMM so that IT pros can manage/provision both physical and virtual resources and systems from the same tool: “This is a much different approach than VMware, Virtual Iron and XenSource who are focused on managing just the islands of virtualised systems,” O’Rouke writes.
“Traditional systems management vendors like IBM, HP, CA, BMC have created plug-ins to their management tools in order to manage VMs. But, they have yet to create the deep instrumentation that the SCVMM team has done, that will manage Windows Server virtualisation,” he adds. Of course, the problem that Microsoft customers face is that O’Rourke is still saying “will do”, when what they want to hear is, “can do.”
