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Virtustream Offers "True Consumption-Based" Cloud Platform

By Kenneth Corbin (Send Email)
Posted April 17, 2012


Fresh off of a new round of venture funding, Virtustream is looking to expand its foothold in the enterprise-oriented cloud computing market as the startup continues to preach the gospel of the cloud to the larger segment of IT customers.

Virtustream secured $15 million in a Series B round of funding in March, bringing its total capital funding to $75 million, with a portfolio of investors that includes Columbia Capital, Intel Capital and Noro-Moseley Partners.

Virtustream's flagship offering is xStream, a Swiss army knife of a cloud platform built for large and complex IT environments with high security standards. The platform supports multiple hypervisors and can run as a public, hybrid, private or virtual private cloud deployment. It is available as management software that enterprises can deploy in their own data centers, or as a managed service residing in Virtustream's cloud.

Virtustream's xStream cloud platform is built to help "enterprises benefit from significant efficiency savings beyond traditional virtualized environments, with true consumption-based pricing," explained Lisa Desmond, Virtustream's senior vice president of marketing.

The company plans to apply the capital raised in the new round of funding to broaden its geographical footprint, strengthen its existing client relationships and expand the capabilities of its xStream product. At present, Virtustream maintains several offices in North America and the United Kingdom, as well as four data centers throughout the world. Propelled by the latest round of funding, the company is pursuing strategic partnerships overseas as it gears up to enter China and markets in Southeast Asia, including Malaysia, Indonesia and Thailand.

"The additional solution enhancements planned for xStream will enable cloud federation and cloud exchange capabilities -- combining private clouds, virtual private clouds and public clouds," Desmond said of the planned product upgrades.

As an infrastructure-as-a-service (IaaS) play, Virustream emphasizes its transparent, pay-as-you-go pricing model. IaaS pricing is typically set by the peak application loads, which Virtustream estimates can result in average capacity excesses of 30 percent.

In contrast, the company has developed its own metric -- the so-called Micro-VM, or µVM -- which Virtustream claims can provide enterprises with a more granular (and fairer) method for selling computing power. The firm describes µVM as a "sub-virtual-machine pricing model" that helps clients achieve a stronger return-on-investment.

Included in the xStream platform is an Advisor Service that evaluates specific factors about a company's business goals, existing IT infrastructure and skill sets, and then develops a blueprint for a tailored cloud deployment, helping businesses navigate through questions of public vs. private (or a hybrid model) and whether to opt for a dedicated or multi-tenant enterprise cloud. Too often, Virtustream argues, companies setting out on their cloud transformation miscalculate their needs, resulting in a deployment that is either insufficient for the IT apparatus or over-provisioned, leading to a set of unnecessary expenditures.

Virtustream's approach is very much in keeping with a prevailing trend in the enterprise market that the company has identified, where enterprises are increasingly looking for more distributed data centers where more machines are capable of performing any task and toggling quickly from one to the next.

"The market is shifting from that of big iron proprietary servers to more generic-style servers" that are "distributed more broadly," Desmond said. "Rather than a few powerful machines, our customers are looking for broader multi-server clusters capable of being adapted at a moment's notice." In today's environment, "servers may be running an ERP system today and could very well be a Web cluster tomorrow and a CRM the week after that. Flexibility is the name of the game and efficiency is what rules today's data centers."

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