Feeds

VMware eats Digital Fuel

Will p*ss fire and put the heat on IT budgets

Build a business case: developing custom apps

Server virtualization juggernaut and cloud plumbing supply provider VMware has acquired Digital Fuel Technologies, a company that has created online applications for doing IT costing, budgeting, planning, showback and chargeback. Digital Fuel has also built systems for implementing service level agreements for IT infrastructure and tracking key metrics to give IT managers performance anxiety.

VMware has had chargeback and capacity planning features embedded in its ESX hypervisor and related vCenter management console since these functions were grafted onto the vSphere 4.0 stack back in August 2009. The vCenter Chargeback and vCenter CapacityIQ features have been updated since then, but other specialists have carved niches for themselves in doing the bean-counting for virtualized server environments. These include VKernel with vOperations Suite, Embotics with V-Commander, and Cloud Cruiser with Cloud Optimizer, just to name a few. The idea behind all of these tools as well as the services provided by Digital Fuel is that IT shops want to implement something akin to the pay-per-use pricing of public clouds on their internal and external capacity and then charge the users, departments, geographies, and business lines for the capacity they use.

Clearly VMware thinks its own chargeback features are not up to snuff, or it would not be shelling out a rumored $85m to acquire Digital Fuel, as reported in Israeli business newspaper Globes.

Digital Fuel's IT Financial Management suite is written in Java and has a visual front end that is a must for the financial types. At the heart of the product is an IT cost allocation engine, which includes the rules tracking capacity used as well as carving up who gets to pay for it as it is consumed, as well as a service level engine that sets performance levels for IT resources – and measures how well or poorly the systems map to expectations. The system has connectors for popular ERP systems to collect user and performance data and a slew of prebuilt reports to show who is running over-budget and where costs could be trimmed based on resource allocation and actual usage. The system can show capital versus operating expenses, and has a "what-if" scenario builder that can, for instance, show the effect on the IT budgets if a chunk of servers in the data center are virtualized.

That might come in pretty handy for VMware's sales reps, too.

Digital Fuel was founded in Jerusalem in 2000 and is now based in San Mateo, California, with development labs in Israel. Company co-founder Benny Lehmann died in 2004, but co-founders Israel Dancziger, Gilad Raz and Yakov Kogan are still at the company as CEO, CTO, and vice president of engineering, respectively. Digital Fuel's first product, ServiceFlow, was created to manage service level agreements, and in the past three years, the company expanded this to cover all aspects of IT budgeting and performance monitoring. The company has 150 employees, all of whom are coming over to VMware, including Digital Fuel's co-founders.

The company has raised $45m in five rounds of funding, the last of which came in March 2007. Apax Partners, Benchmark Capital, Focus Ventures, Israel Seed Partners, and Sigma Partners are the key investors.

VMware did not disclose the acquisition price for the company, and said it expects the deal to close in July. ®

Boost IT visibility and business value

More from The Register

next story
Microsoft: Azure isn't ready for biz-critical apps … yet
Microsoft will move its own IT to the cloud to avoid $200m server bill
Shoot-em-up: Sony Online Entertainment hit by 'large scale DDoS attack'
Games disrupted as firm struggles to control network
Silicon Valley jolted by magnitude 6.1 quake – its biggest in 25 years
Did the earth move for you at VMworld – oh, OK. It just did. A lot
VMware's high-wire balancing act: EVO might drag us ALL down
Get it right, EMC, or there'll be STORAGE CIVIL WAR. Mark my words
Forrester says it's time to give up on physical storage arrays
The physical/virtual storage tipping point may just have arrived
VMware vaporises vCHS hybrid cloud service
AnD yEt mOre cRazy cAps to dEal wIth
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Endpoint data privacy in the cloud is easier than you think
Innovations in encryption and storage resolve issues of data privacy and key requirements for companies to look for in a solution.
Scale data protection with your virtual environment
To scale at the rate of virtualization growth, data protection solutions need to adopt new capabilities and simplify current features.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?