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I didn't hear the Gartner comments first hand, so this is not a rebuttal or review of specific remarks, but rather a comment on virtualization technologies and trends in general as it relates to the ROI or claim that they are "too expensive."

I would agree that there are two factors that appear to effectively argue against virtualization: 1) cost of hardware components is declining fast enough such that the business case for sharing resources is evaporating for some organizations; and 2) the market for software licenses and other cost drivers is not yet in line with a virtualized world such that there remain challenges there.

However, I would contend that the real value proposition of virtualization technologies is not fully realized if IT leaders are looking to virtualization solely for asset efficiency (e.g. server consolidation).

The business case changes dramatically when virtualization technologies are used to make an organization more agile and responsive to dynamic changes in the operating environment. For example, an organization that can redeploy computing, storage, and network resources more quickly to recover from a disaster or to respond to a market opportunity may have significant strategic advantages over competitors or in serving its constituents. Look toward organizations that leverage dynamic, automated, self-service, on-demand provisioning in virtualized environments to get a better sense of the ROI.

So, perhaps virtualization is “expensive” if you capitalize on only a small portion of the value proposition. In which case, I would recommend waiting as well. But, if you are in a competitive environment or one where expectations for faster, better, more reliable service are increasing, then you may conduct a full assessment of the investment and its merits.

I also would not recommend buying a SUV if the only thing you value in a vehicle is fuel economy.

"Too expensive" "virtualization" is an oxymoron!
License fee rationalization is still in the "Evil Empire Age" and, for reasons obvious to all, will lag the real world.
Otherwise, no other technological innovation in memory has combined the "fire" and the "ice" of "business flexibility" and "critical incident security."
Yes, major enterprises will have to confront (and acknowledge) once again the unwieldy costliness of their motley ap infrastructure. But, here is a new arguement for application rationalization -- and concomitant cost savings!
Wake UP!