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Virtual Growth


From the moment we wake, to the moment we shut our eyes for the day, our ears and senses are bombarded with the buzz of new media, web 2.0 and now virtualisation.  The stats machine that is Gartner, recently announced that they (along with the rest of the world) expect virtualisation to grow over the next couple of years.

Despite economic doom and gloom virtualisation software revenue is expected to increase by 55 percent, in 2009, in the EMEA region.  Gartner highlighted Europe as leading the way in adopting virtualised platforms, with UK, Germany and France representing 89 percent of the total EMEA revenue in 2008. 

So, what does virtualisation mean for the outsourcing industry?  What structural changes will end users have to go through? Do virtualised platforms carry with them a new breed of security risks? spoke with a variety of industry experts to find out what the virtual market has in store for the outsourcing industry.

Mark O’ Dell, Director of new technology at IT outsourcing provider, Connect, gives a brief summary of why companies are turning to virtualisation, “Virtualisation is on the increase due to a need to save money, save space and go green.” 
All companies are tightening their belts and it is more than likely that money and space are much more of a catalyst for switching to virtual platforms than a burning desire to go green. 

Ashish Gupta, Associate Vice President of HCL’s European Infrastructure Services Division, pointed out that the streamlining of IT managers work is also a driving force behind virtualisation’s growth, “It [virtualisation] is one of the main factors enabling IT managers to remotely manage and trouble shoot distributed or fragmented resources within the enterprise.”

So, the benefits associated with virtualisation are evident; cost savings, streamlining and consolidation are all words which would put a smile on the face of the toughest CFO. So what does this mean for the outsourcing industry?  Adrian Polley, CEO of Plan-Net, an IT transformation provider, commented, “Outsourcing should become a much simpler proposition as hosting desktops from a central location and deploying to a wide variety of devices becomes commonplace.” 

Companies looking to outsource aspects of the infrastructure will find it far easier on a virtualised system, good news for the industry surely?  Cloud Data’s (a provider of hosting and business continuity services) MD, Karl Robinson, thinks so, “As more companies strive to make cost savings by embracing virtualisation, there will not only be an increase in companies outsourcing their IT infrastructures but also in the management of these infrastructures.”

Suppliers have cottoned onto the fact that virtualisation could lead to easier management of end user’s infrastructure and are now incorporating virtualisation in many of their ITO solutions, Mr Gupta comments, “More and more it is the case that outsourcing, at the infrastructure level, includes elements of virtualisation as standard.  30 to 40 percent of customers require virtualisation as part of the services HCL supplies.”

Mr Polley also supports the idea that vendors are turning to virtualised offerings, ”Hosting companies which would typically have just offered rack space in their data centres are now offering to run customer servers in virtualised environments.  Also, typically managed service providers who take over the running and operations of a company’s servers are looking at virtualising those servers as part of the package.”

This all seems like a win-win situation for suppliers and end users, however, data loss and IT security is more of a concern to CIOs than ever before.  Do these virtual platforms pose a bigger security threat to companies?  Mr Robinson feels that “security in a virtualised environment is no more of an issue than security in any traditional IT department”.  This may seem a little over zealous, it is true that virtual platforms make disaster recovery processes a lot more efficient however there are still significant threats.

“A quarter of a million malware threats are virtual aware” says Mr O’ Dell, these malware threats will certainly grow and become more sophisticated, it is therefore up to IT management to ensure that security measures are in place that deal with virtual threats and all staff are well trained on protecting the virtual environment. 

Data loss is also a concern as Mr Polley highlights, “In theory, staff from the hosting company may have access to the systems – is this appropriate? Is this being adequately controlled?  Often customers make assumptions that the hosting company has implemented strong security measures to protect data and systems, but this may not be the case.” 

This comes back to the age old issue of setting strict SLA’s, security requirements and responsibilities at the procurement stage.  Outsourcing of any kind needs SLAs in place, end users will end up getting their fingers burnt if they find out mid way through a contract that a supplier is inadequately monitoring the security of their new virtual platform.  Better to sort this out at the start, if the supplier cannot replicate in-house security measures then they may not be the right bunch for the job.

Virtualisation is set to grow, there is no doubt about that.  The outsourcing industry is responding and evolving to accommodate this trend and virtualisation may even spur on growth in an already booming outsourcing market.  End users looking to switch to virtual platforms will need to make sure that they choose the right supplier for the job, or have the right team in house. 

If outsourcing the virtualisation process, the same best practice principals must apply.  Users have to ensure that vendors can replicate any security protocols they have in place.  Vendors, ultimately, must provide a more efficient and cost effective infrastructure than the one the end user already has, there is no point in going virtual just for the sake of it.  However, with the ongoing growth of virtualised services, it seems that it won’t be long before we see the majority of companies (from SME’s to large corporates) using some form of virtualised platform.  The future could be closer than you think.




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