Are Hypervisors Cloud Commodities?

This article was originally posted on the VMware vCloud corporate blog. I am re-posting here for the convenience of the readers of my personal blog.

There have been a number of discussions in the industry in the last few years about whether hypervisors are (becoming) a commodity and whether the value is (or will be) largely driven by the management and automation tools on top of them. To be honest, I have conflicting sentiments about this. On one hand I tend to agree. If you look at how the industry is shaping pricing schemas around these products, that's the general impression - all major hypervisors are free, and by definition one could argue that they are a commodity.

On the other hand, this doesn't really match my definition of commodity. I'd define a commodity as something that had reached a "plateau of innovation" where there is very little to differentiate from comparable competitor technologies. This pattern typically drives prices down and adoption up (in a virtuous cycle) because users focus more on costs rather than on technology differentiation. The PC industry is a good example of this pattern.

Is this what it is happening with hypervisor technologies? Hell no. I think there is no one on this planet who thinks that deploying OS images on dedicated physical servers is faster, more flexible and in general better than deploying them on a virtualized host. Yet virtualization usage, in the industry, is broad but not deep and it's usually around 30 percent (on average) within most organizations. And these technologies are widely available for free (ESXi, Hyper-V, XenServer and KVM)! So, if everybody agrees there is a problem with the current physical server deployment model, and that there are technologies available to download from the Internet that can address the problem, why are organizations only confident to put 30 percent of their workloads on these hypervisors? Can someone explain this? My take is that there may be a number of concerns around support and licensing. But the industry has matured and made huge progress on this front in the last few years (Oracle being one of the few exceptions unfortunately). I bet that a large chunk of that 70 percent of servers deployments is not virtualized simply for technology concerns such as stability, performance, scalability, security and so forth. Where there are technology concerns or technology limitations then there is space for innovation (or education to raise awareness).

The fact that the industry is moving to a model where the hypervisor is free and the management tools are the source of revenue tells a partial story to me. The technology story behind the scenes is quite different. The reality is that there are multiple ways to look at hypervisors and their use cases. If you view the hypervisor as the thin software layer that allows you to consolidate five servers on a single box... well I am with you. At 10 Km/hour there is little difference between a Ferrari and a Fiat (even though the Ferrari is still damn cool). If you, instead, view the hypervisor as the foundation for private and public clouds where multi-tenancy, security, flexibility, performance consistency and predictability, integrity and scalability are not optional characteristics... well then there is a difference indeed.

You may argue that you can achieve most of these characteristics using the proper management and automation tools that sit on top of bare metal hypervisors. But the fact is that the policies at the management layer are only as good and reliable as the hypervisor used to implement and enforce them. Yes, you could put a Ferrari engine on a Fiat and have the best pilot (Michael Schumacher Fernando Alonso) pushing it at 330 Km/hour! And everything may be great up until the moment you hit the brakes and find out that it will take you 1,500 meters to stop it (if you don't hit a wall before). Similarly could say that the real "value" of an airplane is its cockpit with all the automation that goes into it. Again, you can put autopilot on and all is good but, at the end of the day, the autopilot (and all the other automation technologies in the cockpit) only instructs the "basic" airplane technologies (thrust reversal, flaps, etc) to do the real job. And I can assure you will want these technologies to be as good, reliable and secure as possible! Always remember that it's not the autopilot and all the slick automation that happens in the cockpit that keep you flying at 33.000 feet - it's the wings.

I am mixing metaphors here and perhaps digressing. Going back to our lovely "commodity" hypervisors discussion, one of the things that always shocked me is how powerful the networking subsystem is that is inside ESX. It's just amazing. Out-of-the-box and easy-to-use support for distributed virtual switches, redundancy (both at the physical and logical level), multiple failover and balancing algorithms on a PortGroup basis, traffic shaping, security built-in via the VMSafe APIs, and a tons of other parameters and features that you can leverage and tune based on your specific requirements. And what you have seen so far is really just the foundation of what's happening in terms of injecting more cloud oriented and multi-tenancy support. We are working on some cool stuff that will be out in the future that is just amazing. I personally spent the last three months digging into those things and the potential there is phenomenal. I can't talk about this in detail today but it's pretty clear that here we are not talking about just setting up 10 Windows VMs on a physical server allowing them to connect to a flat L2 segment sharing a single Ethernet cable. I can't wait to talk more about what we have in the works and to prove to you that, just like you can't build a castle on the sand, you can't build an Enterprise Cloud on a limited hypervisor.