1. Copyright 2009 IDC. Reproduction is forbidden unless authorized. All rights reserved. David Senf, Director Infrastructure Solutions Group idc.com November 24, 2009 Changing Face of Virtualization

2. Jan-14 © 2009 IDC 2 GDP Profits Un- employment -2.4% -33.8% 8.4% 2009

3. Jan-14 © 2009 IDC 3 Yet another forecast Source: IDC Market Models

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5. Jan-14 © 2009 IDC 5 IT conundrum – tradeoffs inevitable

6. Jan-14 © 2009 IDC 6 The Big Switch – Nicholas Carr

7. Jan-14 © 2009 IDC 7 The Big Switch – Nicholas Carr

8. Jan-14 © 2009 IDC 8 The Big Switch – Nicholas Carr

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10. Jan-14 © 2009 IDC 10 capacity=demand The Big Switch – Nicholas Carr

11. Jan-14 © 2009 IDC 11 So where are we now?

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14. Jan-14 © 2009 IDC 14 Utilization & Maintain Real Estate ++++ Power & Cooling Admin

15. Jan-14 © 2009 IDC 15 Cost avoidance through virtualization

16. Jan-14 © 2009 IDC 16 Opex Capex Virtualization by the numbers Top Savings 25% cost reduction over 12 months across capex and opex

17. Jan-14 © 2009 IDC 17 Business case development Half of firms create formal business case to justify virtualization investments. As for the rest.... I figured I had saved about $1.5M...[in] hardware costs... I didnt go into a lot of the intangibles... -Pharmaceutical If I go to my CFO, he wants to see a couple of pieces of data, not a hundred. - Manufacturing

18. Jan-14 © 2009 IDC 18 Server build decisions Suggest virtual servers 57% Hardware centric 11% N=400 Virtual default 32%

19. Jan-14 © 2009 IDC 19 How did we get here?

20. Jan-14 © 2009 IDC 20 Server capability and density soars – virtualization gets a leg up Annual Cores Shipped Annual CPUs Shipped 1 app/server 1 app/blade 1 app/CPU 1 app/core

21. Jan-14 © 2009 IDC 21 Sprawling Server Infrastructure Operational Costs Rise Dramatically WW Spending on Servers, Power and Cooling, and Management/Administration

22. Jan-14 © 2009 IDC 22 New Economic Model for the Datacenter Shifts to Automation Tools are a Requirement WW Spending on Servers, Power and Cooling, and Management/Administration Virtualization Management Gap

23. Jan-14 © 2009 IDC 23 Zero sum game? If we had not virtualized the number of servers would be significantly greater...Our carbon footprint would be greater… We are spending less as a whole. - Financial Services

24. Jan-14 © 2009 IDC 24 New Economic Model for the Datacenter Shifts to Automation Tools are a Requirement WW Spending on Servers, Power and Cooling, and Management/Administration

25. Jan-14 © 2009 IDC 25 Considerations

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27. Jan-14 © 2009 IDC 27 Few VMs Profile IT-centric Virtualize for hardware savings Low ITIL use Resource mgmt Lack of visibility Manual processes Physical & virtual tools / mgmt separate Lower VM / server rate (e.g., 5/server)

28. Jan-14 © 2009 IDC 28 Many VMs Profile Business-centric Virtualize for competitive advantage High ITIL use DR/HA Resource monitoring / measurement Automate processes Physical & virtual tools / mgmt integrated Higher VM / server rate (e.g., 25/server)

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31. Jan-14 © 2009 IDC 31 Virtual machine adoption hurdles – past Time Inst. Resistance

32. Jan-14 © 2009 IDC 32 Cost/ Budget Tools Virtual machine adoption hurdles – present Expertise Availability Capacity Planning

33. Jan-14 © 2009 IDC 33 5 things on order

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35. Jan-14 © 2009 IDC 35 From noun to verb

36. Jan-14 © 2009 IDC 36 The Next Virtualization Milestones Virtualization 1.0 Encapsulation Resource sharing Dynamic consolidation Virtualization 3.0 Automation Service oriented Policy based Cloud Computing Variable costs CAPEX Operational Cost Reduction Virtualization 2.5 Unplanned HA/DR/back-up Workload balancing Virtual Clients Virtualization 2.0 Mobility Planned downtime Virtual Clients 2013 Production Consolidation 24% Availability 39% Virtual Clients 15% SW Development & Test 6% Utility Computing 16% 2006 Production Consolidation 49% Utility Computing 1% Availability 11% SW Development & Test 36% Virtual Clients 3%

37. Jan-14 © 2009 IDC 37 Virtualization has lots of head room Virtual Physical Server Type Low High Business Critical

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39. Jan-14 © 2009 IDC 39 The good, the bad and the ugly

40. Jan-14 © 2009 IDC 40 Server Virtualization Impact: 2005 20062007 2008 2009 20102011 2012 3.0 3.3 4.3 5.4 6.3 7.0 7.6 8.0 VM Densities Nearly Triple Cross Over 5% Shipments 5% Shipments 20% Shipments 20% Shipments

41. Jan-14 © 2009 IDC 41 Virtualization Machine Movement Mobility is on the Rise VM Movement Frequency VM Mobility Management 80% report moving virtual machines across physical hardware 60% report using automation tools This highlights the evolution of virtualization and the desire to exploit increased functionality Illustrates movement towards more dynamic & flexible IT environment Dont Move VMs Manually Move VMs Using Policy Tools Move VMs Manually & Using Tools

42. Jan-14 © 2009 IDC 42 VM tools features we desire N=297: QC01MR. Which of the following systems management features or tools are you currently using to support your virtual servers? Please select all that apply. 1 st wave 2 nd wave

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44. Jan-14 © 2009 IDC 44 Action not reaction

45. Jan-14 © 2009 IDC 45 N=255 Which of the following describes your organizations business continuity planning status? DR plan? What DR plan? We have a plan that is regularly tested We have a plan, but it is not regularly tested Have no plan Have an ad hoc plan I think one area specifically that [virtualization] has changed is our ability to provide a better level of service [for] our DR and BCP. - Financial Services

46. Jan-14 © 2009 IDC 46 Dial it up – ITIL? 12% in 2006 Process automation evolves on a scale from anti- inflammatory early on, to steroid down the road 23% in 2008

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48. Jan-14 © 2009 IDC 48 Resistance is futile

49. Jan-14 © 2009 IDC 49 Total PCs installed in Canada from 1985 - 2009 50% of Canadian Firms Use & Plan to Use Desktop Virtualization

50. Jan-14 © 2009 IDC 50 PC Total Cost of Ownership (TCO) Opex makes up the bulk of spending Q: What is the average breakdown of your PC expenditure? Source IDC Virtualization Forum Deploy, Support, Train Operations Administration Hardware & Software 60% 10% 7% 23%

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52. Jan-14 © 2009 IDC 52 Cloud?

53. Jan-14 © 2009 IDC 53 Words Canadians use to describe cloud.....

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56. Jan-14 © 2009 IDC 56 Please contact me at: David Senf Director, Infrastructure Solutions dsenf@idc.com http://twitter.com/Senformation Questions or comments