In this Article Infrastructure 3 Tools quick hit: Getting more from your virtual machines An evolving market Competitive outlook Setting the standard Twists and turns Related Links Q&A: VMware eyes 'real' utility computing Virtual management: Moving up the OSI stack Review: SLES 10 provides virtualization

Peek inside most enterprise data centers today, and you’ll probably find at least one or two x86 boxes running VMware’s server virtualization software. Odds are good the technology got there as part of an effort to consolidate an upward-spiraling number of industry-standard servers.

Now, watch the number of virtual servers in production quickly escalate. Conditions are perfect: Enterprise IT executives are increasingly comfortable with the technology at a time when VMware is moving quickly beyond its roots in basic slicing and dicing. It is broadening its infrastructure focus and enticing companies with the prospect of true utility computing.

“Consolidation is still important. It’s an easy ROI story to tell, and it will continue to be a conversation-starter for VMware,” says Scott Donahue, vice president at Tier 1 Research. “But once it’s in there, it will be demonstrating its value around other things like disaster recovery and fault tolerance and performance and shifting applications — all the things you expect to get out of a dynamic computing environment.”

VMware wants to provide not just tools for carving up physical systems, but also an automated framework that promises the most efficient use of virtualized resources. Toward that end, it has opened its code so that partners, such as network interface card and applications vendors, can integrate better with its virtualization software. It’s also pushing for virtualization standards. Ultimately, VMware wants to turn x86 virtualization into the foundation for the New Data Center.

Not surprisingly, this push comes as VMware, which has dominated the market it created in 2001, faces a growing cadre of competitors (see “VMware competitors”). Among them are Microsoft and smaller companies, such as Virtual Iron and XenSource, that make use of Xen open source virtualization technology. Industry observers say the increasing competition should help spur VMware to improve its technology and reevaluate its pricing, which today seems to be the biggest — and only — sticking point for many users. VMware is starting to address the issue, selling its ESX Server and related management tools in tiered pricing, which starts at $1,000 per two CPUs and increases according to the features included. Previously, pricing for ESX Server alone started at about $3,800 per two CPUs.

“Yes, VMware is the leader right now, but like any other new technology provider, it’s important to watch what the company is doing and where it’s headed to make sure it continues to stay ahead of the competition,” says Barry Naber, assistant director for enterprise IT operations at International Truck and Engine. The Warrenville, Ill., manufacturer runs about 180 VMware virtual machines on fewer than a dozen servers across four data centers. “Right now, I’m pretty committed to VMware, and I think it’s headed in the right direction,” he says.