VMware Cuts GSX Server Prices

by Timothy Prickett Morgan

VMware, the virtual machine partitioning software maker that is a subsidiary of disk array maker EMC, announced last week that it is slashing prices on its GSX Server virtualization program.

In the first quarter of this year, VMware slashed the price on its Workstation product, which provided partitioning for PCs and workstations so they can run Windows, Linux, NetWare, and other operating systems side-by-side on a single machine, from $300 down to $189. Michael Mullaney, vice president of marketing for VMware, says that volumes picked up significantly after the price cut, and enough to convince it to take a similar approach on GSX Server.

GSX Server is the entry VMware product for virtual machine partitioning on servers. The company's flagship ESX Server is a hardware virtualization software layer that provides complete isolation of partitions from each other, and it costs more than GSX Server, which runs virtual machine partitions inside a primary Linux or Windows host operating system. GSX Server is cheaper and easier, but if that primary operating system fails, it takes down all of the partitions on a box.

That is not a big deal for many applications, and VMware reckons that the price of GSX Server has been holding back volumes. To that end, VMware is cutting the price of GSX Server from $2,500 on a two-way server down to $1,400. It is also capping the price of GSX Server on larger machines at $2,800, regardless of the number of processors in the box, from 4 to 32. Up until now, GSX Server cost $5,000 on a four-way box and $10,000 on an eight-way box. Mullaney says that the biggest boxes he typically sees running GSX Server are 16-way machines, and customers installing these boxes will obviously see a big reduction, down to $2,800 from the $20,000 VMware was charging before the price cut.

The price cuts are meant not only to spur demand, but also to make GSX Server more price competitive with the new kid on the virtualization block, Microsoft's Virtual Server 2005, which supports Windows, Linux, NetWare, and OS/2 (yes, OS/2) partitions. Microsoft is charging $499 for four-way servers and $999 for servers with 8 to 32 processors for Virtual Server 2005; customers also have to buy Operations Manager for $729 and pay $539 for each MOM-managed device.