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High Tech-Virtualization: Making Computing More Efficient and Cost Effective

What's New in Technology

July 2005

High Tech-Virtualization: Making Computing More Efficient and Cost Effective

Hailed as the next revolution in the computing world, virtualization is rapidly becoming a powerful force in the industry. Although the concept has been around for a while, virtualization has only recently begun to attract serious attention from the business sector as companies begin to bring this exciting new technology to market. Though complicated to explain, virtualization delivers cost benefits everyone can understand.

What exactly is virtualization?
Perhaps it is easier to explain in terms of what it does. Virtualization allows applications to be moved around among computers or within an individual computer. It allows users to shift from one supplier’s products to another’s. In the virtualization model, one server acts like many virtual machines and can make it possible for various storage devices to behave as if they were one device. It has the power to decrease the number of servers a business needs while boosting the utilization and efficiency of those in use. For Chief Information Officers, it is the magic wand that enables computer users to do more with less, dramatically reducing the labyrinth of servers and storage units needed to meet a company’s computing needs.

Why is it important?
Because it has the power to change computing significantly, making it cheaper and more efficient. Virtualization technology grew out of attempts by industry leaders to find a way to deliver computer services to businesses in the same way that utility companies deliver electricity to homes and industry. It was envisioned that companies would outsource their computing needs, their usage would be metered, and they would pay on the basis of their utilization. Virtualization technology was created to facilitate the complex interaction of servers and storage devices needed to make this "utility computing" happen. What started out as a "pipeline" for industry leaders to deliver software products and services is now seen as a means to simplify a business’s computing needs. Increased efficiencies in software utilization, in turn, reduce the number of servers needed and streamline the entire computing processes.

Who benefits from this new technology?
Almost anyone who buys and manages a computer network should see savings (sometimes substantial) in computing costs. Virtualization not only reduces the amount of software you need to buy, but it also requires fewer servers and storage devices. Less equipment also means lower service and maintenance costs.

Another key benefit is freedom to purchase products from a variety of suppliers. Companies that make computers and operating systems pretty much have a lock on their customers. Most customers currently have to purchase storage systems and software from the same vendor, and have very limited opportunities to use products from other vendors.

What are the disadvantages?
As with any new technology, there are still a few glitches to be addressed. It is also important to note that this new streamlined computing technology needs complex monitoring and management systems, which might create more headaches for technology officers.

It’s early days yet, but virtualization may be the next big thing - with the power to transform the computing industry.
 

These articles are intended to provide general resources for the tax and accounting needs of small businesses and individuals. Service2Client LLC is the author, but is not engaged in rendering specific legal, accounting, financial or professional advice. Service2Client LLC makes no representation that the recommendations of Service2Client LLC will achieve any result. The NSAD has not reviewed any of the Service2Client LLC content. Readers are encouraged to contact their CPA regarding the topics in these articles.

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