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Randolph Johnston

Virtual PCs and Servers

Are accountants ready?

August 6, 2007
by Randolph Johnston

Virtualization of servers and desktops will no longer be an option in the near future, regardless of how large or small your organization is.

What is virtualization or a virtual machine? Virtual machine technologies enable one physical server to run one or more operating systems and related applications. A virtual machine uses software and selected hardware devices to create an emulated operating environment. Both servers and desktops can be virtualized. We can emulate an entire real machine by loading all the applications in a single disk file that is controlled by a virtual machine software application such as Virtual PC 2007. There is no limit to the number of virtual machines that can be run other than the physical machine limitations.

Why Is Virtualization Needed?

The recent release of Microsoft Vista is primarily what’s driving organizations into adopting virtualization. This new operating system has many applications that are not compatible. The issue will be forced on many when they must replace a computer, and find that the only option they have is to buy a machine with the Windows Vista operating system installed. The next problem will be that some applications that are mission-critical will not work. The cheapest solution we have found to date is to install the free Virtual PC 2007 from Microsoft and load the legal copy of Windows XP along with the needed supporting applications in their own virtual machine.

For example, it seems every week I’ m running into a client who has some older application that they are still running. They can’t upgrade their computers because the application won’t run on a newer operating system. One situation involved an older version of Great Plains that would not run properly under Windows XP. By loading the older operating system and Great Plains in a virtual machine, a new machine could be purchased, installed and the older application could still run. In fact, it ran faster. Many accounting software products are still not Vista compatible. However, even assuming all current applications will eventually become compatible, what about the older applications like prior year tax products or legacy accounting systems? These can be run on a virtual machine instead of saving an old piece of hardware in the corner to “occasionally” run the application.

Why is virtualization important?

  1. Can run incompatible applications on Vista
  2. Can run multiple desktop OS platforms and related applications
  3. Can run older versions of applications (tax, for example)
  4. More up time and flexibility
  5. Fewer boxes to purchase and maintain
  6. Less IT staff time needed
  7. Less costly and/better business contingency planning
  8. Can run demonstration software or test software without the danger of contaminating your system
  9. Can save stable versions of the desktop and distribute

While virtualization is important, there may be some licensing issues. Many of you have purchased OEM (pre-installed) licenses with your HP or Dell computers, and these licenses may not be transferred unless you have an Open License agreement with Microsoft. You have a limited license since it can only be used on the machine you purchased the license with. In other words, you don’t have a full license that allows using the operating system on another machine including virtual machines.

So, who are the key players?

  1. Desktop
    1. Microsoft Virtual PC 2007 — free — this product was originally purchased from Connectix
    2. VMWare Workstation — $189
    3. Parallels — wildly popular on the Macintosh. This product supports Windows applications
  2. Server
    1. VMWare ESX is clearly the server leader currently
    2. Microsoft Virtual Server 2005 R2
    3. Xen on Linux (now ships preloaded in Enterprise Red Hat or SUSE)
    4. Sun and IBM both have significant offerings as well

Last, but not least, there is a major technology shift happening with disk files called Virtual Appliances. A virtual appliance is a pre-built, pre-configured and ready-to-run software application packaged with the operating system inside a virtual machine. One year ago, VMWare had around 160 virtual appliances available, and today there are over 4000. Check some of this out at www.vmware.com/vmtn/appliances. Virtual appliances are fundamentally changing the application stack and how it is packaged and distributed as ISVs develop self-contained and optimized application stacks that are easy to deploy, run on any hardware and are more secure and reliable. Virtualization is definitely in your future.

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Randolph P. Johnston is Executive Vice President of K2 Enterprises, a technology consultancy serving the accounting profession. He is a nationally recognized educator, consultant and writer with over 30 years’ experience in Strategic Technology Planning, Systems and Network Integration, Accounting Software Selection, Business Development and Management, Disaster Recovery and Contingency Planning, and Process Engineering.