How hot is the virtualization market?
VMware, which created x86 server virtualization and is the dominant player in the market, is absolutely on fire. When EMC bought the company in 2003, VMware revenues were around $100 million a year. VMware’s final numbers for 2007 aren’t out yet, but the company is on pace to hit $1.5 billion. In August, EMC engineered an IPO for 10% of VMware. It turned out to be the most successful high-tech IPO since Google, with EMC raising nearly $1 billion when 33 million shares were snapped up at an opening price of $29. The stock continued to soar, exceeding $50 a share on opening day, and soon thereafter cresting at more than $125 a share. Today, VMware is selling at close to about $80 a share, which gives the company a market capitalization of around $30 billion. That’s hot. And the virtualization market is showing no signs of slowing down. In fact, IDC is predicting that worldwide spending on virtualization software and services is expected to jump from $6.5 billion in 2006 to more than $15
