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Virtualisation could save more than US$1B for Malaysian businesses: IDC

AvantiKumar | Sept. 30, 2013
VMware kicks off Virtualisation 2020 initiative by unveiling new IDC study, which shows virtualisation has already helped Malaysian businesses avoid almost US$266M in spending and that this figure is expected to reach US$1.05B by 2020.

Laurence Si, Country Manager of VMware Malaysia explains survey findings Photo - Laurence Si, Country Manager of VMware Malaysia explains survey findings to media.

According to cloud infrastructure provider VMware's sponsored new IDC study, the use of virtualisation has already helped Malaysian businesses avoid spending about RM860 million (US$266.62 million) to date and that this figure is expected to increase with an additional RM2.54 billion (US$0.79 billion) by 2020.

VMware Malaysia country manager Laurence Si said Malaysian businesses will avoid a total of RM3.4 billion (US$1.05 billion) by 2020, according to IDC's Server Economies Index.

Si said that the unveiling of this study marks the launch of VMware's Virtualisation 2020 campaign to help businesses "move from the client server era to the mobile cloud era of computing."

He said the IDC white paper - Vision 2020: Virtualization's Potential US$98 Billion Impact (August 2013, IDC#AP77008W) - offers an analysis on virtualisation during the past 10 years and looks forward through 2020.

A hypothetical model was built to measure the impact of virtualisation in the x86 server world by estimating the additional x86 server spending that would have taken place if no virtualisation solution was offered, said Si.

Four key areas
Si said that in Malaysia, the expected economic impact using the IDC model shows that Malaysian businesses would avoid RM3.4 billion (US$1.05 billion) costs in four main areas:

  • RM2.1 billion (US$0.65 billion) in server spending costs avoided due to servers avoided - more than half of the costs avoided in total. Server spending refers to the customer revenue generated from the sale of physical servers. This amount was roughly equivalent to 7.5 years of RM100 (US$31) education aid that could be handed out to each of the 2.8 million primary school students annually. 
  • RM420 million (US$130.2 million) in power and cooling costs avoided due to servers avoided. This refers to cost of energy to power and cool a physical server in the data centre. 
  • RM30 million (US$9.30 million) in floor space costs avoided due to real estate avoided. This refers to the land or construction cost associated in housing a physical server.
  • RM817 million (US$253.29 million) in server admin costs avoided. This refers to server admin costs avoided and includes IDC's estimate of the cost of people and overheads needed to manage each physical server.

Regional data centre hub vision
Si said that the survey findings also show that cost savings could almost quadruple from RM860 million (US$266.62 million) to RM3.4 billion (US$1.05 billion) (comparing the period of 2003-12 against 2013-20) if more businesses adopt virtualisation in the future.

"As Malaysia pursues becoming a world-class data centre hub, it is increasingly important for data centre operators and large enterprises to consider virtualisation technologies as a way to reduce operational and management costs and also fuel the drive towards cloud computing," he said.


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