Channel Register

Original URL: http://www.channelregister.co.uk/2007/10/27/swsoft_china_inspur/

SWsoft tries to virtualize China before VMware speaks the language

By Ashlee Vance in Mountain View (ashlee.vance@theregister.co.uk)
Published Saturday 27th October 2007 15:49 GMT

Virtualization player SWsoft hopes to continue its Chinese invasion via a new deal with local hardware heavyweight Inspur.

While the likes of IBM, HP and Dell sell more servers in China, Inspur ranks as the top homegrown seller of corporate hardware. The company has now agreed to add a virtualization software component to its arsenal by pre-installing and/or reselling SWsoft's Virtuozzo package. Such a deal could be a win for SWsoft as it looks to gain ground in a market where VMware has yet to establish a dominant presence.

SWsoft first started hawking its unique, non-hypervisor based virtualization software in China back in late 2005. It has seen 300 per cent growth in the past two years with software localized (simplified and traditional Chinese) for the Chinese market, according to SWsoft CEO Serguei Beloussov.

Beloussov sees the deal with Inspur and focus on China as a continuation of SWsoft's 'do what VMware isn't' strategy.

"If you think about it, we always try to compete with VMware by going places VMware is not," Beloussov told us. "We did software for the Mac, service providers, specific workloads and specific geographies."

Virtuozzo differs from products such as ESX Server from VMware, Xen and Microsoft's upcoming "Viridian" software in that it does not rely on a hypervisor layer. Instead, the product takes a single copy of the operating system and carves that up into multiple containers that run applications in an isolated fashion. This approach has a number of merits since it requires fewer operating system licenses and is relatively easy on system resources.

Sun Microsystems offers very similar software through its Solaris containers.

Moving forward, however, SWsoft will introduce a hypervisor-based platform as well. It plans to ship (http://www.theregister.co.uk/2007/09/14/swsoft_parallels_virtuozzo/) a production version of Parallels Server early next year.

Beloussov the Bold

Chatting with Beloussov is one of the more refreshing experiences for a technology journalist. This feisty Russian has yet to attend sugar-coating school.

For example, Beloussov harbors a bit of resentment for the attention XenSource receives. According to our sources, XenSource will make about $8m in revenue this year versus more than $100m for SWsoft. XenSource, however, receives far more press.

"Even though Xen is very popular with the media, we just don't see them in deals," he said.

And what about Microsoft?

"Right now we depend on Microsoft and Linux to deliver some of the core functions comparable to what VMware delivers," Beloussov said. "So, we hope they ship a good product (next year). They are our best partner."

That sounds pleasant enough, right? Well, here comes the sour-coating.

"In reality, it does look quite suspicious right now (as to whether Microsoft will ship a 'good' product)," Beloussov said. "They are delivering the product late and cutting the features. What they are planning to ship right now is like what VMware was shipping two years ago. That is really a concern."

Having dug at XenSource and Microsoft, Beloussov found time to hit the touchiest of subjects around VMware - EMC's majority stake in the company. In case you haven't noticed, VMware's market capitalization is close to matching that of EMC. In addition, EMC's long stagnant stock price has recently started moving north thanks to goodwill engendered by its virtualization software baby.

"How much sense does it make for VMware to be owned by EMC." Beloussov asked. "As a separate entity, it will probably be more interesting.

"Also, right now it's a concern for HP, IBM and Dell. EMC is certainly going after the server market in the long run."

That should fuel a fire or two.

Speaking of the long run, you have to wonder what happens to SWsoft. It enjoys one of the strongest desktop virtualization plays thanks to Parallels and has what must be the second largest x86 server virtualization business - one centered on a unique play. Will Microsoft, Sun, Red Hat and others let SWsoft stay independent? We doubt it. ®

Bootnote

Those of you into virtualization will want to check out our Nov. 6 E-Symposium (http://www.theregister.e-symposium.com/programme.php) on the technology. Of course, there are probably about 20 ads around this story telling you the same thing.

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