In-Depth

Oracle's Bold Strokes

Virtual Iron and Sun acquisitions plunge Oracle deeper into virtualization waters, but the company still lags behind the leaders.

As shareholders and regulators pick apart Oracle Corp.'s acquisition plans for Sun Microsystems Inc., company outsiders mull over all the various ways in which the merger will affect the IT industry. One looming question: How will a Sun-imbued Oracle, also much richer technology-wise from its incorporation of Virtual Iron wares, affect the virtualization market-if at all?

Opinions range from "Not too much" to "Wow, over time, this could really shake things up."

No matter their personal forecasts for how these gambits will play out for Oracle, industry watchers agree on this: The Oracle VM server virtualization software and Oracle VM Management Pack for Oracle Enterprise Manager are too meager for today's go-to virtualization environments.

Lack of Stack
Oracle's virtualization stack might as well be nonexistent, says Andi Mann, a research vice president with Enterprise Management Associates Inc. "Oracle VM is essentially just a wrapper around the open source Xen hypervisor, and Oracle Enterprise Manager is really just a management tool for physical environments," Mann explains.

Oracle won't keep its place among the industry's enterprise heavyweights without a better virtualization strategy, says Michael Fauscette, group vice president, Software Business Solutions, at IDC.

"If you want to be a mega tech vendor and play in this cloud-infrastructure-provider world we're going toward, you have to have a robust virtualization offering or it'll take you out of opportunities you'd otherwise have," Fauscette says. "Virtualization has to be integrated. It has to be in your stack and have all sorts of good management capabilities."

Mitchell Ashley, principal at consultancy Converging Network LLC, agrees about the importance of virtualization to Oracle's future. "Whatever happens with cloud computing and virtualization, enterprises will still run Oracle and Microsoft software. Those are critical," Mitchell explains. "We also know ... every piece of the data center is being virtualized: servers, databases, applications, network elements, services like security. So what Oracle and everybody else is trying to do is maintain control of its own destiny."

 Never one to mess around, Oracle Corp. CEO Larry Ellison delivers a one-two acquisition punch, nabbing Sun Microsystems Inc. and Virtual Iron within a month of each other this spring.

For Oracle, that means controlling the virtualization platform and the management capabilities of it-or end up living at the mercy of Microsoft or Cisco Systems Inc., which itself is moving down the stack for a more secure spot in the virtual future, Mitchell says.

Management Boost
Oracle may have had the same thing in mind, hence its acquisition of Virtual Iron. Not a huge player by any means, Virtual Iron was a smart, quick choice for giving Oracle critical missing technology, analysts say.

"Oracle really wanted to short-circuit development of its enterprise management stack around virtualization, and Virtual Iron gives it a way to do that," says Chris Wolf, a senior analyst with Burton Group. And for that, Virtual Iron was really the only choice. "Nothing else out there could address some of Oracle's immediate virtualization management needs," he adds.

Virtual Iron entered the virtualization market early, making its debut in 2003 with a push toward enterprise data centers. Over time, against the increasingly formidable VMware Inc., the company backed off its enterprise emphasis. Instead, it turned its attention to small and midsize businesses, and was quite effective at delivering good server virtualization and management technologies at a price point far more doable for that market segment than VMware's, analysts agree.

Virtual Iron's management platform is on par with the features and functions VMware offers in its Virtual Infrastructure 3 management suite, Wolf says. Live migration and dynamic workload balancing are two particularly important basic management features for virtualization that Virtual Iron brings to Oracle.

But Wolf is careful to point out that Virtual Iron is comparable to Virtual Infrastructure 3 and not its state-of-the-art and recently released successor, vSphere 4. Plus, he adds, Virtual Iron 4.5, released in February, doesn't meet Burton Group's enterprise evaluation criteria. "It's missing integration with enterprise backup products, and doesn't have enterprise-class support for policies or role-based access controls required by an enterprise," he says.

A Beginning, Not an End
In other words, the Virtual Iron management technology is just a start, Wolf explains. Getting an acceptable, enterprise-ready virtualization management tool is going to take a lot more work. More integration and stronger security controls will be imperative, he adds.

Mann agrees. "Server virtualization is fundamental, but what you do on top of that is what's critical," he says. "And while Oracle needs to catch up at the bottom layer to become truly viable, it's mostly on the management side where Oracle really needs to concentrate."

 Dave Rudzinsky of Hologic Inc. is intrigued by Oracle's virtualization play, but not yet ready to commit to a new virtual infrastructure.

In fact, Mann says he wouldn't be surprised to see the company pull out its wallet yet again for the same reason. Potential targets could be Marathon Technologies Corp. for high availability and load balancing; VKernel Corp. for virtual infrastructure optimization; and Fortisphere Inc. or ManageIQ for performance management, Mann says. "The big problem is that most companies that do really strong management tend to focus on the VMware platform and not Xen, but they should be able to convert pretty easily," he adds.

No matter how deep Oracle might go with virtualization management, it will still need a lot of luck to surpass market leader VMware, some say. "VMware has a very mature toolset, and no company, including Oracle, can offer comparable management products. Period, end of discussion," says Chris Rima, supervisor of the infrastructure systems team at Tucson Electric Power (TEP).

TEP, an Oracle customer and a subsidiary of UniSource Energy Corp., in Tucson, Ariz., has virtualized 90 percent of its IT environment using VMware's Virtual Infrastructure 3 today with plans for vSphere 4 in the works. It relies heavily on VMotion, VMware's live migration tool that allows a virtual machine (VM) to be moved from one physical server to another with no discernable downtime.

In other words, being an Oracle customer doesn't make IT managers such as Rima ready to take on the company's virtualization technology.

"Oracle would like enterprise customers to deploy Oracle VM technology so it'll have one place to point a finger at for support. While that sounds good on paper, a virtualization infrastructure is about much more than the hypervisor and core management platform," Wolf says. "You have data-protection operations you have to worry about, and lifecycle management, change control, integration with security-there are a lot of other tools that round out the ecosystem." And most enterprises aren't going to bother implementing a new virtualization stack if it requires its own set of management tools, he adds: "It doesn't make sense from a management perspective. It drives up operational expenses, and for most organizations, that's been a nonstarter."

Oracle readily acknowledges it's hoping Virtual Iron will get the company closer to where it needs to be, virtualization-wise. "The combination of Virtual Iron's technology and Oracle VM ... is expected to provide more comprehensive and dynamic resource management across the full software stack," the company said when it announced the acquisition.

Also clear is that Oracle won't maintain Virtual Iron's products as distinct entities. On July 21, Oracle held a customer webcast during which Wim Coekaerts, vice president of Linux and virtualization engineering, explained its decision-effective June 30-to stop selling the Virtual Iron products, and outlined a roadmap for integrating the Virtual Iron technology into Oracle's own server virtualization and management products. Oracle is offering lifetime support for existing Virtual Iron products.

That's no surprise, Mann says: "Oracle doesn't maintain multiple technologies. Historically, it merges and integrates technologies and products, going to market with only one product in any given space." And given that Oracle VM is Xen-based, as is the Virtual Iron product-and Sun's xVM Server, for that matter-Oracle will cast its favor on its own technology, using the management expertise of Virtual Iron to layer capabilities on top of that, Mann adds.

The integration will begin with the release of Oracle VM 2.2 this year, Coekaerts said during the webcast. For example, the 2.2 release will support the import of Virtual Hard Disk (VHD) images into Oracle VM. "We want the ability to take an existing Virtual Iron virtual server and make it relatively easy to convert to Oracle VM in the future product," Coekaerts explained. Also in the works is a management plug-in for the Virtual Iron VM manager.

Next up will be Oracle VM 3.0, a major release fully taking advantage of the dynamic resource-management technology Virtual Iron has developed over the years. In particular, Oracle VM 3.0 would provide improvements in capacity and power management, automated network and storage configuration, a more scalable and modular management framework and full management stack, as well as enhancements for availability, reliability and scalability. Oracle also will expand its portfolio of templates for easy deployment of its own and third-party software, Coekaerts said.

Coekaerts didn't specify release dates, but indicated that both products would be available in fiscal year 2010, which ends May 31, 2010.

Sun Inside Oracle
The bigger question, analysts say, is what becomes of xVM and Sun's other virtualization technology once Oracle takes ownership of that company. Coekhaerts didn't address Sun integration during the July webcast with Virtual Iron customers.

Like Virtual Iron, Sun has good server virtualization and virtualization management technology. But it also has decent desktop and storage virtualization technology-and targets enterprises. But virtualization didn't appear to be a motivating factor for the $7.4 billion Sun acquisition, per Oracle's public-facing statements. Virtualization wasn't a talking point in the official April 20 acquisition announcement, whereas Java and Solaris got big play.

That leaves industry watchers speculating about what the company has on its Sun-related virtualization agenda. Mann, for instance, says he can see Oracle using Sun expertise in virtualization and virtual systems management, while Wolf says Oracle isn't interested in Sun for management at all. "That's what it has Virtual Iron for," Wolf says.

IDC's Fauscette points to the potential value of Sun's storage virtualization technology for storing database and application data more efficiently across the data center. He mentions technologies such as seamless storage migration and thin provisioning as particularly valuable for their ability to reduce the cost of database storage, which can in turn ease application deployment and management.

With the Virtual Iron technology, Oracle also gets the ability to create virtual storage on the fly from the server management console, Mann says. "That's pretty powerful itself," he adds.

The Desktop Virtualization Story
But on the desktop virtualization side of the ledger, Mann doesn't anticipate Oracle doing anything but ditching Sun's products. "Oracle lives and breathes in the data center. I don't think Oracle has the skills or abilities to get out to the desktop in a really forceful way against someone like HP, which partners very strongly with VMware, or Dell, which partners with Citrix, to provide an end-to-end solution," Mann explains. "Oracle would really be facing an uphill battle going up against those two-especially for the desktop."

Wolf has a different view-one that sees a future competition with companies like Citrix, Microsoft and VMware requiring desktop virtualization as part of an end-to-end solution set. "Sun has quite a bit of technology it can leverage on the desktop side, and it has an established customer base for that technology, with a proven track record," Wolf says. "On the virtualization side, that's the biggest thing Oracle gets from Sun."

Dave Rudzinsky, senior VP of IS and CIO at Hologic Inc., a medical devices company in Bedford, Mass., says he'll be listening closely to what Oracle has to say about desktop virtualization. "This is an absolutely important technology for us in managing desktops in factory environments and other places, and we're already doing some stuff with VMware's VDI," he says. "But we're always going to listen to what Oracle is going to say on all this virtualization stuff."

Rudzinsky elaborates: "We're committed to Oracle in a way where we always start out a new project with the question, 'What does Oracle have to help us?' This means if we were to look to virtualize our production Oracle applications and databases, we'd start with a question to Oracle: 'What do you guys think?'" he explains. But until now, VMware has been Hologic's strategic vendor for server virtualization and virtualization management, "and we like to standardize," Rudzinsky says. "We wouldn't make a decision to go with Oracle VM lightly."

'Windows Killer'?
However, the Oracle-Sun combo does excite Rudzinsky, as Hologic uses enterprise software from Oracle running on Sun hardware, he says. "If Oracle can deliver a sort of black-box solution that provides application, operating system, hardware and the storage that's all tuned for its software, that'd be pretty cool," he notes. "Who'd need a systems integrator then?"

Mann takes that concept a step further, thinking about how Oracle might interweave virtualization and Java. "Now Oracle has the opportunity to virtualize server-based applications using the Java VM, and that could turn the way we view the data center infrastructure upside down," he says. "If you extend the Java VM and start to look at how the Java VM can interact-really tightly integrate-with server virtualization technology, then you have the opportunity to have something like an Oracle application running pretty much on top of bare-metal hardware. All you have to do is have the Java VM communicate through the server virtualization components to the hardware," Mann explains.

And then, he adds, the question isn't about systems integrators but, at the extreme, Microsoft. "This could be a Windows killer," Mann says.

Consider: Oracle has the fundamental components of an OS, either Sun Solaris or Linux; the ability to virtualize an application on top of those OS kernel components; and the ability to virtualize the OS kernel components on top of bare-metal hardware, Mann explains. "All of a sudden, Oracle has the potential to come out with one package that just goes onto an Oracle server-and that's pretty revolutionary," he adds.

Mann acknowledges that whether Oracle would attempt such a feat isn't certain. "That's a lot of hard work and it would alienate a lot of potential partners," he notes. "But it could really revolutionize ease of deployment, use and management of Oracle applications in the data center."

As of press time, with the Sun acquisition awaiting approvals, Oracle remains tightlipped about how, if at all, that company's virtualization technology will affect its strategy. (The company also declined several requests for a briefing for this article.)

But Oracle certainly has the chance at morphing itself, as it's done in the past on the enterprise application side, Ashley says. "It could go from being a database and application-centric company to one offering databases, applications, virtualization and open source middleware," he notes. "This really could transform Oracle."

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