The challenge for WAN Optimization vendors in the past is that they would deploy their software on appliances to ease the installation for network administrators. Many of the appliances though were not purpose built, they were simply off the shelf hardware from a server OEM that the WAN Optimization vendor preloaded and preconfigured their software.
This gave the vendors some consistency in the hardware and made things easier to support. The challenge was that it was another brand of hardware to integrate into your data center. The vendors also quickly learned that even if they bought the same hardware from the same hardware vendor they still had to deal with changes to motherboards or network interface cards. The consistency they desired was not being delivered.
Enter virtual appliances. With virtual appliances WAN Optimization vendors like Riverbed Technology, Silver Peak Systems, Certeon and NetEx now had a very consistent "hardware" platform. Certeon and NetEx have both earned the VMware Ready label. As a result these companies and others not only eliminate the challenge of having to deal with physical machines they gain all the advantages of the virtual environment. For example you now have the ability to move your WAN appliance between physical hosts in case of hardware maintenance or a need for more performance. You also don't have to worry about having IT staff that understands WAN Optimization to mount hardware in each remote location. For the vendors the "hardware" is now downloadable so you can more easily evaluate it. For customers you can easily "ship it." It is also bundle-able meaning that WAN Optimization vendors can partner with storage and backup software companies to deliver and all in one solution.
There is also some potential for Virtual WAN Optimization and Cloud Storage. With hardware it would be difficult to offer a universal solution to thousands of potential customers. Virtual WAN Optimization software could be part of the cloud storage download or integrated into the cloud gateway to make performance of cloud storage even better.
From a performance perspective most vendors are reporting results in the virtual versions of WAN Optimization that leads me to believe that performance between dedicated hardware and shared hosts is going to be a wash for many data centers. Even if you decide to dedicate a virtual host to just the WAN Optimization virtual appliance you still gain all the benefits of virtualization should you need them.
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George Crump is lead analyst of Storage Switzerland, an IT analyst firm focused on the storage and virtualization segments. Find Storage Switzerland's disclosure statement here.