The enterprise virtualization market

I’m often asked by some of my colleagues at Juniper as well as potential customers about whether OpenContrail is applicable to the enterprise virtualization market. This market is today dominated by VMWare while OpenContrail has chosen to focus its energy at OpenStack. The question often comes in the form as to whether I see enterprise adopting OpenStack for virtualization. The answer is, of course, “no”.

To quote an analyst report, “The shift to SaaS is the leading agent of change” in enterprise I.T. This is the main driver of transformation, not OpenStack. While the traditional approach used to be for enterprises to buy software packages and install them on premise, this is now becoming a quaint approach to doing business. I.T. management and operations, like just about everything else, is more efficient at scale. It is simple to understand that it is cheaper to administer 1000 instances of a CRM application “as-a-service” than for 1000 enterprises to do so themselves.

It is also intuitive to understand that the organization that developed a particular software application is then one that can most effectively administer, manage it and maintain it. From an economical perspective, safe some exceptions, if an organization did not develop an application it probably has no business in hosting it. Data security concerns are real. But today’s enterprise centric cloud providers are very conscious of these issues and can most likely bring more resources to bear in terms of information security than your typical I.T. department.

It is quite common to see companies switch their sales support system, CRM applications, all the critical systems that support the business from in-house hosted to SaaS. The applications just work better. One example that i’ve seen personally is how painful the traditional hosted expense report systems used to be vs. how much nicer is the SaaS tool that my employer is currently using.

This “leading agent of change” is going to affect I.T. spending in general and data-center spending in particular. SaaS providers are growing rapidly. They are the target customers of anything that it is being done in data-center automation today. For a SaaS company the kind of automation that a system like OpenStack brings is crucial. The name of the game is to reduce the time between start of development and deployment. Cycles are measured in weeks. This is totally incompatible with the traditional management workflows in enterprise I.T. where to get trivial resources like a set of VMs it would take days if not weeks with trouble tickets being processed by humans.

Data-center automation systems built for a SaaS providers do not need to use traditional compute virtualization in the form of hypervisors. Some of the automation being built is still using hypervisors today but the trend is clear. KVM, Xen or ESXi are not required for the vast majority of compute loads than will be running in the next 5 years. Technologies such as Linux containers are significantly more efficient than hypervisors at isolating applications. And tools such as docker do a much better job at managing software distribution and change control than virtual machine images. With docker it is much faster to build an image with the components that are required for the specific application.

By getting rid of hypervisors it is also simpler to manage memory over-subscription. Systems that use hypervisors are typically capable to correctly manage CPU over-subscription but not memory. Memory is as expensive of a resource as CPU and should not need to be managed in static blocks given to the guest OS (which doesn’t have a useful job to perform).

The hypervisor may still be a useful tool to deal with exceptions… but by and large it is unnecessary for a data-center where the large majority of the workloads run on the same OS as the hosts. It is clear that all the trend lines point away from virtualization as traditionally defined.


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