More firms will be encouraged to try server virtualisation after telecoms giant Vodafone last week detailed how the technology had unlocked substantial savings - and could also improve control over apps run on externally-hosted servers.

Vodafone project manager Doug Colvin said his firm will deploy up to 300 new Wintel servers in 2005, and will manage most of them with VMware virtualisation tools.

He added that in the longer term, virtualisation could let Vodafone outsource its server operations. "Why not contract third-parties such as HP to own and operate VMware server farms and pay them to host our virtual server systems?" he said. This new hosting scenario could make it easier for firms to retain control of mission-critical applications and speed up the deployment of new applications.

Vodafone's research found that virtualisation technology would cut the maximum time to acquire and deploy a new server from 40 days to 32.5 days. It also found that upgrading a single site of 140 servers to run across two sites using VMware's ESX Server would save £270,000 each year.

This approach would also give firms the flexibility to move between server hosting firms with minimal disruption, because virtualisation insulates applications or operating systems from server hardware.

However, Dan Kusnetzky of analyst IDC said software licensing could cause problems. "It would be very important for hosts and customers to make sure that all the software was licensed to run in this environment on the host's machines," he said.