VMware to give away ESXi for free

With VMware soon to offer ESXi for free, the hypervisor will officially become commoditized.

A few short weeks since his former employer Microsoft officially released Hyper-V, newly installed VMware Inc. CEO Paul Maritz told investors on a second-quarter earnings call that the next version of ESXi will be available for free, a decrease from its current price of $495 per dual-CPU server.

The updated ESXi will be available for download from VMware's website this coming Monday, a VMware spokesperson confirmed.

For more on VMware and Hyper-V:
Hyper-V won't sail past VMware on price alone, users say

Virtualization pricing wars: The future of VMware, Hyper-V and Xen

Virtualization face-off: The case for Hyper-V

The ESXi price drop comes at a time when VMware is set to enter "its third major phase of growth," Maritz said. The first phase, he said, was about establishing the hypervisor, which he described as VMware's "bedrock enabling technology." VMware's second phase was "to go beyond the hypervisor and become an infrastructure provider for the server and the desktop," as exemplified by the 20 products in its VMware Infrastructure 3 (VI3) suite. Now, in the third phase, VMware's mission is to "dramatically extend Virtual Infrastructure for more uses and more users," Maritz said. By dropping the price for ESXi to zero, "many more people that can benefit from that technology."

VMware's mission in its third phase of growth is to "dramatically extend Virtual Infrastructure for more uses."
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Since December 2007, VMware has shipped the lightweight ESXi hypervisor, which partitions a server so that it can run virtual machines (VMs). But while that functionality is absolutely central to VMware's software offerings, ESXi's functionality ends there; additional capabilities such as live migration (VMotion), high availability, and even the ability to be managed by VMware's VirtualCenter management console, come at an additional cost.

Specifically, VMware Infrastructure 3 Foundation costs $995 per dual-CPU server and provides VMware Consolidated Backup (VCB), Update Manager and a VirtualCenter agent. VI3 Standard Edition builds on that and adds VMware High Availability for $2,995. Finally, VI3 Enterprise includes all these features plus VMotion, Storage VMotion, Distributed Resource Scheduler (DRS) and Distributed Power Manager and lists for $5,750.

Because all three VI3 editions already include a license for the ESX or ESXi hypervisors, it would appear that dropping the license fee for ESXi should have no measurable impact on most VMware customers, which overwhelmingly deploy ESX and ESXi along with VMware Infrastructure software.

Bogomil Balkansky, VMware's senior director of product marketing, conceded that the number of IT shops that can benefit from a bare-bones ESXi hypervisor is limited. "The main use case is consolidation for small environments, or edge environments such as remote offices," Balkansky said. "They're small customers, are in emerging markets or are just getting into this."

Currently, VMware has directed those sorts of "extremely cost-conscious" customers to its other free product, the hosted VMware Server, which has been downloaded 2 million times since the company made it free two years ago when Microsoft introduced Virtual Server 2005. "Its footprint is fairly substantial," he said. Going forward, Balkansky said he expected customers that would have opted for VMware Server to instead choose ESXi as their virtualization platform.

At the same time, Balkansky reiterated the company's plans to continue supporting and developing VMware Server. "We are a serious and reliable software vendor. We can't just pull the rug out from under them and say, 'VMware Server is going away.'"

VMware's cloudy forecast
On the earnings call, Maritz also alluded to future VMware news. In addition to continued investment in VMware Infrastructure, version 4 of which will be released in 2009, and Virtual Desktop Infrastructure (VDI), "now, we also have the opportunity to extend usage of our technology toward the cloud," he said.

Maritz was referring to cloud computing, a utility or grid computing model exemplified by offerings such as Amazon Web Services and Google App Engine. VMware's role in the cloud is twofold, Maritz said. "We have a double play here. Virtual Infrastructure has a lot of relevance in the cloud itself," he said, enabling the flexibility and dynamic scalability that are the cloud's hallmarks. At the same time, VMware is also "an on-ramp to the cloud, allow existing customers to easily migrate their technology onto the cloud and back again."

Maritz, who was also the founder and CEO of Pi Corp., a cloud computing startup acquired by EMC Corp. in February 2008, told investors that "cloud computing will be a big part of VMworld 2008 in September."

Editor's note: ESXi includes additional functionality not noted in this story, though it will be covered in forthcoming Articles. For more information, see VMware's ESXi release notes.

Let us know what you think about the story; email Alex Barrett, News Director. You can also check out our Server Virtualization blog.

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