IDC Announces Q2 Worldwide Server Virtualization License Shipments

Industry analyst firm IDC today announced worldwide virtualization license shipments in the second quarter of 2008 (2Q08) increased 53% year over year, compared to a 72% year-over-year increase the previous quarter. The x86 server market led the way with 60% year-over-year growth followed by the EPIC server market with 18% growth. See the news release here.

IDC’s findings included the following:

· “Quarterly totals of x86 server virtualization licenses continue to experience healthy growth, although the growth rates have slowed over the last four quarters. The modest decline in growth rates indicates that the market is showing early signs of maturation.”

· Worldwide new server shipments virtualized increased 52% year over year in the second quarter, compared to 70% growth in 1Q08.

· Worldwide virtualization software revenue grew 15% year over year in 2Q08, compared to 32% growth in the first quarter of 2008. The growth in virtualization software revenue primarily came from the x86 server market, which grew 39% year over year.

· VMware’s position in the x86 server virtualization software market, with a combined market share of VMware ESX and VMware Server, is at 44% based on new license shipments.

· Microsoft's Hyper-V delivered a strong showing, and when combined with Virtual Server 2005, helped Microsoft to capture 23% of new license shipments in 2Q 2008.

Microsoft’s perspective:

· Customers now have choice in market. VMware is no longer the dominant server virtualization vendor (< 50%). Customers now have choices that include Microsoft, Citrix, Sun, Novell, RedHat and Oracle.

· Microsoft’s server virtualization software already has half of VMware’s share in the market.

· Another indicator of the strong customer and partner adoption we’re seeing of Microsoft’s datacenter and desktop virtualization software.

o SAP now supports their ERP software running on Windows Server 2008 Hyper-V. See details: https://www.sdn.sap.com/irj/sdn/go/portal/prtroot/docs/library/uuid/70f63258-bff1-2a10-9db6-cda6ef202bfc

o Microsoft’s server virtualization software and management software are 1/3 the cost of VMware’s comparable products.

o Microsoft global server OEM partners have seen Hyper-V attached to 95 percent of their Windows Server 2008 orders.

o Microsoft’s global server OEM partners have been reporting greater demand for Windows Server 2008 Enterprise and Datacenter editions due in part to the expanded virtualization use rights.

· The combination of Windows Server Hyper-V, Windows Server 2008 Terminal Services, and the System Center suite of management tools is being adopted by large, medium and small businesses.

o Banverket ICT (Sweden): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002838

o SOk Group (Russia): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002703

o Costco Wholesale Corp (U.S.): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002624

o Bouygues Construction (France): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002619

o Saint Raphael Healthcare System (U.S.): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002615

o Gartmore (U.K.): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002610

o The Atlanta Journal-Constitution (U.S.): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002533

o Saxo Bank (Denmark): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002529

o WorleyParsons (Australia): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002503

o Land O’ Lakes (U.S.): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002135

· Microsoft’s application virtualization software, called App-V, is one of the fastest growing products at Microsoft, helping customers stream applications to desktops while reducing the costs of managing desktops.

o City of Biel (Switzerland): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002668

o California State University (U.S.): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002789

o Hennepin County Medical Center (U.S.): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002270

o State of Indiana (U.S.): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000001697

o Belfast Health and Social Care Trust (N. Ireland): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002053

o Banverket ICT (Sweden): https://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000002838

o BASF IT Services (Germany):