Investors Back New Open-Source Server Virtualization Company

by Timothy Prickett Morgan

VMware, the workstation and server virtualization software vendor that pretty much had the market to itself until Microsoft got into the act by buying Connectix last year and launching Virtual Server 2005, just got some new competition. The leaders of the Xen open-source virtualization hypervisor project formed a corporation to sell and support Xen in December and have just secured $6 million from venture capitalists.

Seven years ago, Ian Pratt joined the senior faculty at the University of Cambridge in the United Kingdom, and after being on the staff for two years, he came up with a schematic for a futuristic, distributed computing platform for wide area network computing called Xenoserver. The idea behind the Xenoserver project is one that now sounds familiar, at least in concept, but sounded pretty sci-fi seven years ago: hundreds of millions of virtual machines running on tens of millions of servers, connected by the Internet, and delivering virtualized computing resources on utility basis where people are charged for the computing they use. The Xenoserver project consisted of the Xen virtual machine monitor and hypervisor abstraction layer, which allows multiple operating systems to logically share the hardware on a single physical server, the Xenoserver Open Platform for connecting virtual machines to distributed storage and networks, and the Xenoboot remote boot and management system for controlling servers and their virtual machines over the Internet.

Work on the Xen hypervisor began in 1999 at Cambridge, where Pratt was irreverently called the XenMaster by project staff and students. During that first year, Pratt and his project team identified how to do secure partitioning on 32-bit X86 servers using a hypervisor and worked out a means for shuttling active virtual machine partitions around a network of machines. This is more or less what VMware does with its ESX Server partitioning software and its VMotion add-on to that product. About 15 months ago, after years of coding the hypervisor in C and the interface in Python, the Xen portion of the Xenoserver project was released as Xen 1.0. According to Pratt, it had tens of thousands of downloads. This provided the open source developers working on Xen with a lot of feedback, which was used to create Xen 2.0, which started shipping last year. With the 2.0 release, the Xen project added the Live Migration feature for moving virtual machines between physical machines, and then added some tweaks to make the code more robust.

At this point, companies on the bleeding edge in high-performance computing and financial services told Pratt that what he really needed to do was set up a company to offer full support for the product, like Linux, MySQL, JBoss, and other popular open source programs have. So Pratt incorporated XenSource in Palo Alto, California, and hired Nick Gault, founder of a company called Network Physics, a company that sells network management software. "Great open source software becomes a commercial product," explained Gault, "whether the project founders want it to or not. Eventually, the companies actually using the software start demanding real tech support and services." And to make that happen, XenSource needed money.

Luckily, Kleiner Perkins Caufield & Byers and Sevin Rosen Funds, two of the big names in venture capital backing of IT firms, have lots of money and are always looking for a way to strike it big. With VMware now a subsidiary of disk maker and wannabe software powerhouse EMC after forgoing an initial public offering last year and now selling its software to the tune of $250 million a year and doubling each year, Kleiner Perkins and Seven Rosen smell a hot prospect when they see one. And so they just kicked $6 million to XenSource.

Gault says that XenSource will keep its development team in Cambridge, and that the $6 in Series A funding will be used to beef up Xen 3.0, due in the second quarter of 2005, with support for 64-bit Xeon and Opteron processors. That money will also be used for marketing and for packaging up Xen in different ways for different customer sets. Xen 4.0 is due to be released in the second half of 2005, and it will have better tools for provisioning and managing partitions. As Pratt puts it, the technology in Xen is solid, but it is not currently the easiest thing in the world to use. That sounds a lot like open source software.

While Xen will present an interesting challenge to VMware in the open source community, it appears to have a major architectural difference. VMware's hypervisor layer completely abstracts the X86 system, which means any operating system supported on X86 processors can be loaded into a virtual machine partition. This, says Pratt, puts tremendous overhead on the systems. Xen was designed from the get-go with an architecture focused on running virtual machines in a lean and mean fashion, and Xen does this by having versions of open source operating systems tweaked to run on the Xen hypervisor. That is why Xen 2.0 only supports Linux 2.4, Linux 2.6, FreeBSD 4.9 and 5.2, and NetBSD 2.0 at the moment; special tweaks of NetBSD and Plan 9 are in the works, and with Solaris 10 soon to be open-source, that will be available as well. With Xen 1.0, Pratt had access to the source code to Windows XP from Microsoft, which allowed the Xen team to put Windows XP inside Xen partitions. However, now that Microsoft has acquired Connectix to roll out Virtual Server 2005, it seems doubtful that Microsoft will work with XenSource to make Xen-compatible versions of Windows.

When Intel and AMD put virtualizing hardware (Intel's is called Vanderpool Technology) inside their respective X86 processors, Pratt says that it will be possible to run native Windows inside Xen partitions without having a tweaked version of the Windows code. What is true for Windows will be true for all operating systems, presumably, and that means any closed-source OS that runs on X86, Opteron, or Itanium will be able to run inside Xen partitions right out of the box, provided those chips have the virtualization features.

Pratt says that eventually, Xen will support Itanium platforms, and there is talk about putting it on Power-based servers from IBM as well. The software is not tied to the X86 hardware as tightly as VMware seems to be with ESX Server.

The Xen project makes Xen available under the GNU General Public License for free. XenSource, says Gault, will probably sell an enterprise-class compiled software and support offering for about $1,500 per server, with a version aimed at small businesses with fewer servers and support features costing $500 per server. The initial commercial packages of Xen should be available in a few weeks.