VMware Offers Virtual Machine Rental Model For Service Providers


On Wednesday, the Palo Alto, Calif., company announced a new VMware Service Provider Program and license model that lets hosting companies, telecommunications firms, outsourcers and MSPs buy virtual infrastructure services on a per-virtual machine, per-month basis.

The move stands to make it more economical for service providers to consume virtual infrastructure services and enable them to rent customized virtual machine capacity to customers monthly.

With the new program, VMware enters a niche dominated by virtualization ISV SWSoft, whose Virtuozzo software caters to hosting companies.

VMware said it has worked closely with large hosting companies and outsourcers for some time but developed the new packaging model and program because it "aligns the way that they make money, the subscription model," said Bogomil Balkansky, senior director of product marketing at VMware.

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He said the program reduces the barrier to entry for hosting providers and their customers, noting that buying and implementing virtualization software is not a trivial IT cost.

"It's more flexible," Balkansky said. "You can rent what you need, when you need it, in more granular increments instead of having to commit to a select number of servers. You pay for only what you use. It also enables hosters to offer higher service levels at more reasonable costs."

VMware currently has 20 partners enrolled in the program, some of which hosted VMware's virtual infrastructure software before the new licensing model became available. The rental option removes the barrier to entry: The entry-level licensing requirement is 50 virtual machines. Those participating can sport a VMware Authorized hosting logo.

Data Return, Intermedia.NET, Net Access Corp, Rackspace, Attenda, Cobweb, Computacenter Services, FusionStorm, Vericenter and SmartyHost are among the early adopters participating in the pilot program.

Intermedia.NET said it is the first hosting provider to launch a VMware-based virtual private server Windows hosting service. One executive at the New York-based company said the model is better than a Windows hosting service because it provides more flexibility.

"It's taken off pretty quickly. Before VMware, there was a big gap in the market. There were and still are many low-priced VPS offerings based on OS-sharing technology, but there were no higher-end solutions virtualized at the hardware level," said Rurik Bradbury, vice president of marketing at Intermedia.NET. "Even though our hosted VMware virtual machine is slightly more costly to deploy than a lower-end VPS, it is currently the only enterprise-grade hosting solution."

Intermedia.NET will broaden its offering from single-server virtual machines to VMware's Distributed Resource Scheduler, which allows live migration and load-balancing of one virtual machine across several physical servers, minimizing downtime.

It is not clear if VMware's traditional partners and consultants -- those who install Vmware's infrastructure at customer sites -- will be adversely affected by the new offering.

VMware's Balkansky said those partners can host on their own or form partnerships with hosting companies and MSPs to extend the rental option to customers.

SWSoft, for its part, said it is has a market-leading position with hosting companies and 11,000 customers in more than 100 countries.