Like Microsoft, Novell might win over customers because of its expertise in managing an operating system, Burns says.
"The fact that they have a distribution of Linux, they can make changes and say 'the changes we've made here are to make it work better in a virtual environment. But [you need to] use our version of virtualization at the same time,'" Burns says. "VMware doesn't have that."
Novell made a big move on February 25 when it said it will spend US$205 million to acquire PlateSpin, a vendor that helps customers adopt, extend and manage server virtualization in the data center.
PlateSpin markets a PowerConvert product, which performs physical-to-virtual (P2V) conversions of Windows source systems into XenSource's XenEnterprise Virtual Machines.
Red Hat
The Red Hat Enterprise Linux distribution comes with the Xen hypervisor for free, while the RHEL Advanced Platform includes extra features such as storage virtualization, redundancy and high-availability clustering, DiDio says.
Red Hat's strategy is made more interesting by RHEL recently becoming available on Amazon.com's Elastic Compute Cloud (EC2) service, in which users pay small monthly fees, she adds.
"Red Hat is aggressively advertising the fact that its virtualization solution is far more economical than VMware's," DiDio notes. Red Hat vice president Scott Crenshaw has claimed businesses can save "US$20,000 to US$30,000 on licensing fees" compared with VMware, she adds.
Bittman dismisses Red Hat's chances, saying its management capabilities are subpar.
Red Hat is in a similar position as Novell, Burns says, with each having the advantage of distributing its own Linux operating system. "At this point, it's really a matter of who does it first," Burns says. "Who gets it out first and in a reliable, robust fashion."
VMware
VMware has certainly not been standing still in the face of its competition growing larger and more robust. VMware struck a deal in January to buy application virtualization vendor Thinstall. VMware hosted VMworld in Europe from February 26-28 and made several announcements, including agreements with HP, Dell, IBM, Fujitsu and Siemens to ship servers with a slimmed-down version of VMware's hypervisor embedded in the hardware.
VMware also announced plans to open its hypervisor to security vendors with a set of APIs designed to make it easier to build products that protect virtual machines.
VMware officials aren't worried about the competition, according to Stephen Herrod, VMware's CTO, who says "products from would-be competitors aren't really there yet."
VMware may be forced to lower its prices, DiDio says, but overall it's making the right moves.
"The market is VMware's to lose. And these competitors are going to have to take it away from them," she says.
Beyond those already mentioned, the virtualization market includes niche players such as Cassatt, Egenera and Parallels. If enterprise customers expand use of virtualization as much as some analysts predict, even someone holding 1 per cent of the market could be quite successful. "We're just at the precipice of an emerging market. Any of these niche players could be huge," DiDio says.
Hardware advances are making it easier for more vendors to develop virtualization software. VMware can hold onto its dominant market share, but it'll need to outwork its competition.
"[VMware's] technology is still ahead of the competition. But the side of the road is littered with companies that had superior technology and got out-marketed. Think Netscape," Hamilton says. "[VMware] is going to have to carve out more of a value proposition than just being the only vendor out there."
