Server virtualization economic impact will reach $3.89 billion in India by 2020: VMware-IDC study

The economic impact of server virtualization will reach $3.89 billion in India by 2020, according to an IDC study — sponsored by VMware.

The VMware sponsored IDC Server Economies Index says $98 billion worth of spending is expected to be avoided in the Asia Pacific region from 2003-2020 in the areas of server spending, power and cooling, floor space and cost of manpower and overheads.

In India, IDC estimates the potential economic impact at $3.89 billion, comprising costs avoided in a few key areas:

$2.37 billion in server spending avoided due to servers avoided. Server spending refers to the customer revenue generated from the sale of physical servers.

$666 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 datacenter, VMWare said on Tuesday.

$28 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.

$827 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.

“Indian organizations have just begun laying the foundation of their datacenter transformation with virtualization. We’re excited and look forward to the huge opportunity that lies ahead as more and more organizations begin to benefit from our technologies on their journey to the cloud,” said T Srinivasan, managing director, VMware India & SAARC.

VMware estimates that the software-defined data center represents a $28 billion total addressable market (TAM) opportunity by 2016 and could grow above 20 percent globally.

VMware customers have utilized that cost avoidance to both boost the bottom line as well as re-allocate those resources to more strategic IT initiatives such as new application development projects that drive the business forward.

The IDC study estimates the impact of virtualization to reach $98 billion across eight countries in Asia Pacific by 2020.

This includes $25.6 billion in costs that have been avoided to date, which is set to increase by an additional $72.7 billion by 2020.

When comparing results across the countries studied, the findings showed that the mature markets of Australia, Japan and Singapore avoided US$8 billion more spending in historical costs due to virtualization than the emerging markets.

For these mature markets, the critical costs avoided was servers, which contributed to nearly half (47 percent) of overall costs in the four areas. In contrast, the emerging markets of China (PRC), India, Indonesia, Malaysia and Thailand saw greater forecast of the costs avoided by $15 billion in future, than the mature markets.

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