Xen And The Art Of Consolidation: Oracle Buys Virtual Iron

The acquisition of Virtual Iron by Oracle marks a significant consolidation in the server virtualization market. In Virtual Iron Oracle gains effective tools for managing virtual infrastructure while eliminating another competitor using the open source Xen hypervisor.

"A couple months ago there were four significant competitors to market leading VMware that based their products on the Xen hypervisor," said John Sloan, senior research analyst for Info-Tech Research Group. "Now it looks like there will be two."

The four vendors were Cirix (XenServer), Sun Microsystems (xVM), Oracle (Oracle VM), and Virtual Iron. Not even a month after Oracle's announced acquisition of Sun, it has acquired Virtual Iron. The move bolsters Oracle's position against VMware as well as with Citrix and Microsoft (which has its Hyper-V hypervisor product).

Server virtualization continues to be a growth area, even through the economic recession, as organizations look to better manage and utilize their data center resources. Oracle's announcement to acquire Virtual Iron confirms existing rumors about the deal coming together. Although Virtual Iron is a considerably smaller player, it has a presence in the small to mid sized business space due to its full featured server virtualization product that sold at a fraction of the cost of its larger competitors.

"Oracle could offer stronger management features to its enterprise customers," said Sloan. "In server virtualization management is the real value differentiator between products, not the basic ability to carve up a server into multiple virtual machines. In management, VMware has been a clear leader with Citrix rapidly catching up."

With Sun xVM and Virtual Iron, Oracle will also gain a foothold in the emerging virtual desktop infrastructure (VDI) market. In VDI PC workstations are hosted on a server as virtual machines and remote accessed form the desktop via thin client device or PC.

"VMware and Citrix have the lions share of this market but it is just the beginning for VDI and there will be plenty of room for growth and competition in the coming years," said Sloan.

The transaction is expected to close over the summer period. The addition of a strong enterprise class player to the server, infrastructure and desktop virtualization space means more options for end users.

SOURCE: Oracle