2009 is shaping up to be an "interesting" year.

What makes 2009 interesting - rather than good, bad or indifferent - is the daily conflict between hope and despair for those on the good side of a bad trend. Like bankruptcy attorneys or pawnbrokers, some find themselves buoyed by a down economy, becoming only more relevant when the pressure is on to conserve.

In the world of IT, perhaps the best examples of counter-recessionary trends are virtualization and its close cousin, cloud computing - both trends with direct cost benefits. When the economy contracts, the pendulum swings from revenue to cost. High on the minds of every CIO today is how to reduce capital and operating expenses and find ways to do more with less.

At rPath, we're seeing this first hand. Four key factors are positively impacting our market opportunity:

1. Application workloads are becoming increasing complex
The cost and complexity of deploying and maintaining enterprise applications is exploding at the same time that IT is under pressure to conserve resources.

Several factors influence the complexity of applications today:

• Dispersion of developer preferences in languages, frameworks, etc.
• Growing use of open source components
• Number of custom applications and the rate of development
• Distributed, interdependent nature of modern application architectures
• Multiple target execution environments (hypervisors, clouds, etc.)

This is making it harder than ever for IT operations to keep pace with demand and to efficiently deploy and maintain applications in a way that doesn't overwhelm people resources and create quality and compliance issues. The conclusion for many IT organizations is that the old application delivery models no longer work - and many are looking to rPath to reduce the cost and complexity of application delivery. We see this trend continuing as the confluence of cost pressure and complex application environments pushes IT operations to the brink.

2. Virtualization is going mainstream
As organizations invest in virtualization to reduce costs and increase server utilization, they need a systematic and scalable process for building, deploying and maintaining virtualized applications that run in these environments. Today, most application images are one-offs, created by hand and deployed without any way to manage or maintain the application images within the VM container. This can create compliance issues because of inconsistent and untraceable images, and the ad hoc approach often adds significant cost to building and maintaining the images. Since virtualization typically allows applications to be deployed more rapidly than before, it leads to a proliferation of virtual machines in production that need to be maintained - what we're learning is that virtualization transfers yesterday's deployment cost to become an even greater maintenance cost through what is often called "VM sprawl." Organizations are now realizing that this ad hoc approach to application images could wash out the original cost savings virtualization has enabled.

Informal and ad hoc approaches always prevail in the early days of any new innovation. As these innovations evolve from emerging to mainstream practices, informal methods must give way to a more systematic, repeatable approach. This is exactly what we see happening in the world of virtualization - hand-built, one-off application images are being replaced by automated, policy-driven approaches similar to what rPath provides. A down economy is pushing virtualization to the mainstream, which is forcing companies to look more closely at formalized, systematic practices for creating, deploying and maintaining application images.

3. Cloud is emerging
Cloud computing has captured the imagination of both lines of business and IT because it has the potential to transform the datacenter from a capital-intensive bottleneck to a variably priced self-service environment. This can shift the deployment burden away from IT staff, while providing lines of business the deployment speed, flexibility and cost relief they demand.

While the virtues of cloud make good sense, many IT organizations wrestle with a perceived conflict between speed and control. On the one hand, the self-service model takes the friction out of application deployment. But on the other hand, self-service appears to threaten the control and predictability IT ops depend upon.

Of course, saying no to cloud appears to be a poor answer. In this circumstance, IT organizations face the risk of rouge applications "leaking" to external clouds as lines of business find the path of least resistance. What IT needs is a way to provide LOB the speed and flexibility they need, while ensuring that applications deployed to the cloud conform to policies and can be consistently managed. That's rPath's role.

4. ISVs are rethinking the software form factor
Commercial software vendors are under pressure to deliver software products that support a growing variety of platforms. The challenge is that each platform requires a separate build that must be certified and maintained over time. This puts pressure on time to market and the overall cost of supporting additional platforms, which becomes exponential as you maintain multiple application versions against multiple platform versions. Particularly in a down economy, ISVs need a simplified and more cost-effective way to satisfy the need for multi-platform support without taking on the cost and complexity of supporting multiple builds.

All this adds up to what is expected to be an interesting 2009, where cost reduction is the clear mandate for most every enterprise. Despite the malaise of an economic downturn, the prospects are solid for those on the good side of a bad trend.