Twice as many SMBs will be heavily virtualized by 2014, say EMEA resellers

Dubai, United Arab Emirates May 16, 2012 -- VMware, Inc. (NYSE: VMW), the global leader in virtualization and cloud infrastructure, today announced that the EMEA solution provider channel is seeing small and midsize businesses (SMBs)*investing substantially in virtualization, with this continuing to be an IT spend priority. According to new research, the acceleration of virtualization adoption will see twice as many SMBs become more than 80 percent virtualized**by 2014, as they look to drive efficiencies and embrace a move toward cloud computing.

The research, conducted by Canalys among 350 channel partners serving SMBs across EMEA, found that of SMBs who have adopted virtualization, 48 percent have virtualized the basic IT infrastructure of their businesses. Over the next two years, however, 75 percent of SMBs are expected to expand their virtualization programs to include business-critical applications and more. In fact, channel partners predict that 38 percent of these companies will have more than 80 percent of their businesses virtualized, as they move toward IT as a Service, up from 20 percent of companies today.

The reasons behind this extend beyond pure cost savings: reducing costs is the more immediate driving factor (rated most important and second most important by 71 percent of respondents) to virtualize, but it's closely followed by the desire to ensure business continuity and improve hardware utilization. In terms of the over arching business priorities for SMBs, beyond technology, cost reductions (rated as highly important or important by 83 percent), business continuity (79 per cent) and business agility (75 per cent) emerge as the top three, showing alignment between immediate virtualization drivers and longer-term objectives. Furthermore, the majority (86 percent) agree that virtualization and cloud computing are connected.

"SMBs are undoubtedly recognizing the many benefits virtualization can deliver," said Alastair Edwards, principal analyst, Canalys. "It's a tough economic environment at the moment, however, and organisations are getting pulled in many different directions, with costs being scrutinized at every step. Virtualization is being seen as a solution that delivers cost savings as well as broader business benefits; as a result, within two years, channel partners predict that SMBs are planning a rapid rate of virtualization adoption, with the majority of SMBs realising the benefits heavily virtualized environments can deliver. Savvy organisations are those making the connection between IT investment and more holistic business priorities, and are virtualizing today to gain competitive advantage."

Of the main barriers holding back further adoption, upfront costs and virtualization not registering as a short-term priority were those cited by channel partners supplying the SMB market. Tellingly, a lack of understanding was the third decisive factor, suggesting the need for further education from vendors and partners on exactly what virtualization can deliver. 

"Many tens of thousands of SMBs across EMEA have already embraced virtualization and this research indicates this may just be the tip of the iceberg in terms of the depth and breadth of SMB adoption," said John Churchhouse, EMEA SMB director at VMware. "VMware has intensified its commitment to SMBs through its Real World Advantage initiative and offers products and bundles tailored to their specific needs. There's a tremendous opportunity here for channel partners to work collaboratively with VMware to drive awareness for SMBs and jointly assist them on their virtualization journey and the move to cloud computing."

"There is a difference between those companies that see IT as a cost centre and those for whom IT is a strategic priority," says Sam Routledge, solutions director, at UK reseller Softcat Ltd. "For those who see IT as a cost, virtualization doesn't go beyond financial savings. For advanced companies, they want a stable IT platform that is highly available and which aligns with their business strategy, for example; being able to open new offices quickly as they expand the organisation."

As part of the research, Canalys also conducted 12 in-depth EMEA partner interviews on the major trends they are seeing in virtualization amongst SMBs. Feedback from these reinforced the drivers for virtualization raised in the study, but also the need for greater support in educating end users, including: joint marketing activities (both campaigns and roadshows), increased training and certification, and more tailored finance packages and solution bundles***.

*A SMB is defined as an organisation with 1-1,000 employees

**Definitions of the level of virtualized environments:

  • 0-30%: SMBs are virtualizing basic infrastructure, for example file and print

  • 31 - 80%: SMBs are virtualizing business-critical applications, for example email, collaboration software, databases and Windows desktops

  • 81 - 100%: SMBs are heavily virtualized and are moving toIT as a Service and cloud computing

***For further information on VMware SMB initiatives visit:

  • VMware Real World Advantage: an SMB's source of information and resources on the portfolio of virtualization, disaster recovery, management and desktop solutions

  •  VMware Grid: a tool containing Partner Ready Campaigns, enabling partners to execute marketing activity to engage and educate customers, and generate and qualify leads

  • SMB Solutions: tailored product bundles and packages to maximize value for SMBs, including:

o   VMware vSphere® Essentials,VMware vSphereEssentials Plus and VMware vSphere Acceleration kits

o   VMware vSphere Storage Appliance,VMware vCenter™ Operations, VMware vCenter Protect Essentials, VMware vCenter Site Recovery Manager™

o   VMware View™desktop virtualization

  • Training:Live and recorded training, documentation, video tutorials and evaluation guides for both SMB customers and partners

About the Research
Canalys conducted quantitative and qualitative research with senior decision makers in more than360 technology channel companies selling virtualization solutions across multiple countries in Europe, the Middle East and Africa (EMEA). The research aimed to gather intelligence from channel partners on EMEA's SMB market, and understand the drivers and barriers of virtualization adoption within SMBs. The high response rate from channel executives provides strong validation for the findings, and is representative of trends across the whole EMEA region.

About Canalys
Canalys is a global analyst and consulting firm specialising in technology and channels analysis, and delivers smart market insights to IT, channel, and service provider professionals around the world. Our customer-driven analysis and consulting services empower businesses to make informed decisions and generate sales. We stake our reputation on the quality of our data, our innovative use of technology, and our high level of customer service. For more information about our services or custom research and consulting capabilities, please visit our website: www.canalys.com

About VMware
VMware is the leader in virtualization and cloud infrastructure solutions that enable businesses to thrive in the Cloud Era. Customers rely on VMware to help them transform the way they build, deliver and consume Information Technology resources in a manner that is evolutionary and based on their specific needs. With 2011 revenues of $3.77 billion, VMware has more than 350,000 customers and 50,000 partners. The company is headquartered in Silicon Valley with offices throughout the world and can be found online at www.vmware.com.

VMware, VMware vCenter, VMware vCenter Site Recovery Manager, VMware View and VMware vSphere are registered trademarks and/or trademarks of VMware, Inc. in the United States and/or other jurisdictions. All other marks and names mentioned herein may be trademarks of their respective organizations. The use of the word "partner" or "partnership" does not imply a legal partnership relationship between VMware and any other company.

Forward-Looking Statements

This press release contains forward-looking statements including, among other things, statements regarding the plans for SMBs to implement virtualization in the next two years and the prospective benefits of virtualization technologies for SMB customers.  These forward-looking statements are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to our ability to integrate iTHC capabilities into our benchmarking services; (ii) adverse changes in general economic or market conditions; (iii) priorities, delays or reductions in information technology spending; (iv) competitive factors, including but not limited to pricing pressures, industry consolidation, entry of new competitors into the virtualization and cloud computing markets, and new product and marketing initiatives by our competitors; (v) our customers' ability to develop, and to transition to, new products and computing strategies such as cloud computing and desktop virtualization; (vi) the uncertainty of customer acceptance of emerging technology; (vii) rapid technological and market changes in virtualization software and platforms for cloud and desktop computing; (viii) changes to product development timelines; (ix) VMware's ability to protect its proprietary technology; and (x) VMware's ability to attract and retain highly qualified employees.. These forward looking statements are based on current expectations and are subject to uncertainties and changes in condition, significance, value and effect as well as other risks detailed in documents filed with the Securities and Exchange Commission, including our most recent reports on Form 10-K and Form 10-Q and current reports on Form 8-K that we may file from time to time, which could cause actual results to vary from expectations. VMware assumes no obligation to, and does not currently intend to, update any such forward-looking statements after the date of this release.

Contacts:
Natasha D'Souza
The Portsmouth Group
Tel :  +971 4 369 3575
Email: natasha.dsouza@theportsmouthgroup.com

© Press Release 2012