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Network Instruments Upgrades Observer Monitoring Platform, Supports Analysis Of Virtualized Environments

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Network Instruments announced today that its Observer monitoring platform now provides complete visibility and in-depth analysis of application performance and traffic within both virtualized and physical environments. The Observer platform is the first analysis solution to close this visibility gap and extend the power of real-time and retrospective network analysis to virtualized environments.

Observer’s expanded virtual monitoring capabilities go beyond traditional analysis tools which provide limited views of virtualized networks. Network teams using Observer can now access a complete, integrated view of virtual traffic traversing physical networks, between different virtual machine hosts, and between virtual machines on the same host. Further, all virtual traffic and communications flowing within the virtual machine host can be copied and sent to a GigaStor appliance for back-in-time analysis or the Observer Reporting Server for enterprise-wide performance reports.

Complete Performance Tracking
Central to any performance monitoring effort is the ability to monitor seamlessly across physical and virtualized environments. Using the Observer platform, organizations obtain enterprise-wide views of virtualized resources and performance within virtualized and physical environments.

Availability
The Network Instruments Virtual TAP is a key component within the expanded Observer virtualized offering. To obtain this functionality, a user installs a Network Instruments software probe into their VM host environment, where they can copy and send the data to their retrospective analysis device, analyzer console, or a third-party purpose-built device. Current maintenance customers gain these capabilities at no charge.

Gartner Analysts: Virtualization Will Be Disruptive For Server And Storage Vendors

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This comes from the 27th Annual Gartner Data Center Conference, which opened at the MGM Grand Conference Center in Las Vegas: virtualization is proving to be a disruptive trend for server and storage vendors, according to Gartner analysts.

“Virtualization should be seen as not just a tool for (server) consolidation, but as a modernization catalyst,” said Thomas Bittman, a Gartner VP and Chief of Research for its Infrastructure and operations area. “It’s changing how we deal with the business.”

As DataCenterKnowledge points out, Bittman foresees the emergence of a “meta operating system” – a virtualization layer between applications and distributed computing resources that will play a central role in the next-generation data center.

[Read more…] about Gartner Analysts: Virtualization Will Be Disruptive For Server And Storage Vendors

Virtualization Pretty Big Down Under

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Twice as many Australian businesses are using virtualization than the rest of the world, according to analysts, reports Techworld. Gartner says between 8 and 9 % of medium to enterprise businesses are virtualizing their x86 servers, while global uptake remains at about 4 to 5 %.

Gartner’s servers and storage VP Phil Sargeant added that the figures, derived from research into organizational IT maturity, show Australians are spearheading virtualization uptake.

According to Unisys, the figure is even higher, since the 8 to 9 % adoption includes only virtualized systems in production.

VMware (VMW): Second-Quarter 2008 Results (Updated)

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VMware reported its second-quarter 2008 results today, with an earnings conference call which was followed closely after the abrupt removal of Diane Greene two weeks ago (see our ‘the week after‘ post too for reference). Don’t feel too bad for her, we’ve just reported on her potential payout, which could be well over $50 million USD.

These are the results that were just announced, in bullet points:

  • Net income of $52.4 million, or 13 cents a share, compared with $34.2 million, or 10 cents a share, a year earlier.
  • Revenues for the second quarter were $456 million, an increase of 54% from the second quarter of 2007. Update: this is below Wall Street analysts expectations and estimates, who projected $458,6 to 460 million in revenue – (which the company also projected in April but revised later on). Shares going down.
  • GAAP operating income for the second quarter was $61 million, compared to $47 million for the same period last year.
  • Non-GAAP operating income was $112 million, an increase of 52% from the second quarter of 2007.
  • GAAP net income for the quarter was $52 million, or $0.13 per diluted share, compared to $34 million, or $0.10 per diluted share, for the second quarter of 2007.
  • Non-GAAP net income for the quarter was $92 million, or $0.23 per diluted share, compared to $52 million, or $0.16 per diluted share, for the second quarter of 2007.
  • Cash exceeded $1.5 billion and deferred revenue was $721 million as of June 30, 2008.
Second quarter U.S. revenues grew 43% to $240 million from the second quarter of 2007. International revenues grew 68% to $216 million from the second quarter of 2007 driven by strength in Europe and Australia.
Software license revenue grew 39% to $284 million from second quarter of 2007. Service revenues, which include support, subscription and professional services, were $172 million, an increase of 85% from the second quarter of 2007.
As for the financial outlook:
  • 2008 revenues are targeted to grow approximately 42% to 45% compared to 2007. Update: this is rather modest.
  • Third quarter 2008 revenues are targeted to be within a range of approximately $462 to $468 million. Update: Analysts were projecting revenue of $497.3 million
  • Third quarter GAAP operating margin is targeted to be between 11% and 13%. This guidance includes stock-based compensation, employer payroll tax on employee stock transactions, amortization of intangible assets and capitalized software development costs which are targeted at 9% of projected revenue.

VMware is hosted a conference call today reviewing its results and discussing its financial outlook. The call was scheduled to begin at 2:00 p.m. PT/ 5:00 p.m. ET.

A noteworthy statement from Paul Maritz in the call was also the fact that VMware intends to make VMware ESXi completely free. The free version, officially called ESXi 3.5, will be available to download starting July 28. Maritz believes this approach to virtualization will help bring more customers into the VMware fold and make virtualization technology ubiquitous.

VMware

A Closer Look At VMware Financials

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Zachary Scheidt over at Seeking Alpha penned an excellent analysis of the current financial situation VMware is in. Scheidt correctly notes the corrent virtual monopoly the virtualization industry’s poster child holds, and dissects the company’s latest earnings releases.

A small excerpt:

In addition to the $438 million in revenue, the company announced an increase of $88 million in its deferred revenue which is essentially revenue the company has received for service not yet performed. The total is now $641 million which should help to stabilize future revenue as the company can draw on this balance during future periods. In fact, a Credit Suisse analyst had an interesting theory stating that this quarter was helped significantly by the company drawing on this deferred revenue base instead of new business actually driving the strong revenue number.

Read the whole article.

Gartner: Virtualization Wave To Cause Huge Market Disruption And Consolidation Through 2012

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Gartner says virtualization will be the highest-impact trend changing infrastructure and operations through 2012.

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From the press release (emphasis ours):

“Virtualization will transform how IT is managed, what is bought, how it is deployed, how companies plan and how they are charged. As a result, virtualization is creating a new wave of competition among infrastructure vendors that will result in considerable market disruption and consolidation over the next few years.”

According to Gartner, the leading edge of this change is server virtualization, which promises to unlock much of the underutilized capacity of existing server architectures. Server virtualization is already having an impact on the server market; Gartner believes that virtualization reduced the x86 server market by 4 % in 2006. As hypervisor prices drop sharply and management costs decrease because of increased competition, virtualization will have a significantly larger impact, and Gartner analysts predict that more than 4 million virtual machines will be installed on x86 servers by 2009.

The use of PC virtualization is also set to increase rapidly. The number of virtualized PCs is expected to grow from less than 5 million in 2007 to 660 million by 2011. On the PC, the decoupling technology that breaks the close ties and dependencies between hardware and software occurs at two levels: between hardware and the operating system (machine virtualization) and between the operating system and applications (application virtualization).

Check out Gartner’s special report on virtualization, including a number of useful guides and a podcast with industry analyst Thomas Bittman.