'IT virtualisation' sounds like one of those buzz words you wish would go away. But according to market observers every large company is destined to move to the concept with three years, changing the way data is stored, handled and manipulated.

The Butler Group is one such forecaster. The IT consultant believes the move to consolidate data centres is being driven by the need for organisations to reduce energy consumption, the increased importance of the ability to respond to market opportunities faster, and the shift towards more automation as a means of reducing operational costs.

The convergence of these three significant factors in the global economy have created the conditions that make IT virtualisation a technology "that will become the dominant technology in data centers within the next two to three years" the group confidently predicts.

So what exactly is 'IT virtualisation'? I found it difficult to get a good working definition that didn't assume I was a technical wonk. However SearchStorage.com defines the concept as a way of "pooling physical storage from multiple network storage devices into what appears to be a single storage device that is managed from a central console".

This virtualisation, where all data from feeder personal computers is stored on a central server or servers, helps IT managers more easily perform the tasks of backup, archiving, and recovery. But the Butler group means something more than this basic definition.

The new way extends beyond just server consolidation into use as a strategic technology, breaking the rigid links between applications, physical hardware, platforms and middleware, and end users.

This task is done by emulation - making one resource imitate another resource; by partitioning - making one large resource appear as many smaller resources; and clustering - making many resources appear as one large resource.

Virtualisation is the key to IT departments successfully evolving towards a more efficient model for deploying and consuming IT resources, the Butler Group says in a new report.

"Effectively, IT is being moved from a business unit-funded project structure, where the head of department bids for, and provides, the initial capital for the IT project with the on-going maintenance expense being funded from a central, corporate budget, towards a mixed, pay-as-you-go model, where the corporate budget funds the capital costs associated with providing the underlying infrastructure, and the business units are charged for the services they consume and pay for the deployment of any new services required."

Quite an astounding concept really if, like myself, you've treated IT as an all encompassing resource that handles everything from fixing a cable to creating a whole new suite of programs that perform specific functions.

The basic problem this 'virtualisation' is attempting to overcome is the piecemeal evolution of the IT infrastructure that supports organisations.

Chief information officers (CIOs) now find that their biggest issue is the proportion of IT spending and resources dedicated to maintenance activities, rather than adding new value to the organisation.

The situation is compounded by the siloed approach taken to IT resource allocation and deployment within organisations, which in turn could lead to an underuse of IT resources and inhibits the IT department's ability to remain agile in its response to change.

Butler believes that server consolidation can result in savings on maintenance, energy ($159,000 per year per 1,000 desktop computers), and resource use. IT just gets fewer demands for help, because problems can generally be spotted as they occur and most can be fixed remotely.

Butler estimates that computer application-related incidents represent 35 per cent of all calls to the IT help desk.

The new server-hosted virtualised desktop infrastructure (VDI) offers most of the benefits of a traditional computer but with the added benefit of greatly-reduced management costs, Butler sums up.

However the difficulties of getting a virtual IT landscape in operation at your business is no easy task. First, the suppliers of the software and hardware are behind the market, with competing and incompatible technologies retarding implementation.

Butler also cites a lack of management capabilities across physical and virtual worlds in such an IT infrastructure, a confusing mix of terminology and capabilities that the vendors use to describe their products, licensing, and the interoperability of different technologies as hurdles.

"This, however, is not purely a technical challenge, but requires an organisational change from the business unit concept of self-autonomy towards a pooled resource model across the entire organisation," Butler says.

I agree about the problems and benefits. The internet news group I work for has put in place 'IT virtualisation' and has experience some, if not all of the problems associated with such a consolidated model. But after a year, one can definitely see the benefits. At the user end, problems get solved faster.