Riding the downturn: Network vendors eye new markets in '09

Today's rough economy hasn't put the breaks on vendor ambition.

Microsoft aims to become a dominant player in hosted software and cloud computing in 2009, despite its late entry in these markets. Ditto for Microsoft in the virtualization arena — where early arrival VMware has some lofty goals of its own, including shooting for a bigger role in data center management.

No less ambitious is Cisco, which is plotting a switching upgrade, blade servers for the data center and a security plan for virtualized and cloud-computing environments. Juniper Networks plans a refresh of its entire product portfolio, and Avaya will sharpen its focus on unified communications.

Read on for details on what to expect this year from these and other key IT vendors, including their most pressing 2009 priorities and potential stumbling blocks.

Click to see: Chart of predictions

Microsoft sharpens services, virtualization focus

Microsoft's services push dominated its 2008 agenda, and now it's time to deliver the goods.

Industry watchers are tuned in for details on Azure, Microsoft's newly unveiled cloud operating system, as well as the first Web-based versions of popular Office applications, due this year. These play prominently in Microsoft's battle vs. Google to attract enterprise users of online productivity applications.

Click to see: 2009 will be a big year for Ray Ozzie

Just released online versions of Exchange and SharePoint, two of Microsoft's most popular infrastructure servers, also are expected to make waves. "Exchange Online could be a sleeper product," says Peter O'Kelly, principal analyst with O'Kelly Consulting.

It will be a big year for virtualization at Microsoft, too. With its Hyper-V hypervisor firmly on IT's radar as part of Windows Server 2008, and with the recession now official and reinforcing virtualization's cost-saving benefits, Microsoft will deploy a full-court press in order to make its case that Hyper-V was worth the wait.

On the desktop front, Microsoft will spend less time trying to convince people that Vista is a good operating system with a bum rap and more time moving on to the slick UI enhancements and IT benefits of Windows 7. Central to the effort is Steven Sinofsky, who made his name stamping out versions of Office before taking over the Windows team. Sinofsky will deliver the first feature-complete beta version of Windows 7 in early 2009, and then the industry chatter will reach a fever pitch as to its merits and whether Sinofsky can deliver a final version before year-end.

Also on tap is a new version of Office Communications Server (OCS), due to ship in February. Microsoft wants nothing less than to drive the PBX into software. With some shaky players on the traditional telecom side, including partner Nortel, the time could be ripe for a big strategic push given that OCS 2007 R2 is slated to ship with features that will eliminate the need for on-premises gateways to handle VoIP calls.

VMware eyes data-center dominance

VMware is still the top player in the hypervisor market, but this year the company will move far beyond its original focus of virtualizing x86 servers.