In reality, the pricing changes resulted in some customers saving money and others paying slightly more, but a small yet vocal tangent of customers almost immediately cried foul, leading to the term "vTax" to be dubbed. A year later at VMworld 2012 the company's new CEO Pat Gelsinger reversed the pricing change and reverted to the original pricing model. But the damage had been done, Kerravala says, and the situation "opened the door" for users to look at other hypervisors. Microsoft took advantage.
In the past 18 months Microsoft has not only been improving the functionality of its VMware-competing hypervisor, but it is also making a big marketing push to get the software into enterprise data centers where VMware has dominated. The third generation of Microsoft Hyper-V is included with a Windows Server 12 license, and the company has worked to beef it up. Microsoft doubled the RAM capacity per VM to 1TB, added live migration and upped the ability to manage nodes per cluster from 32 to 64. "Hyper-V is now at feature parity for a large percentage of enterprise workloads," says Forrester virtualization analyst David Bartoletti. "It's definitely 'good enough'" for many workloads.
Kerravala's research backs this up, too. A recent survey found 20% of respondents reporting they have deployed Microsoft Hyper-V in production data centers, with another 20% exploring it. The most surprising aspect of the survey: The respondents were all VMware users. "Microsoft is having a bigger impact than a lot of people believe," Kerravala says.
The rise and maturation of Microsoft's "good enough" Hyper-V is only part of the new dynamics in the virtualization market, though. The bigger issue is that hypervisors are becoming commoditized and VMware needs to look beyond just hypervisors for its growth moving forward, Bartoletti says.