The Big Picture on VMware's Big Change

by Amy Newman

VMware's big push is a game changer for the virtualization space. While user enterprises will feel the direct impact, the ripples will be strong for partners and competitors.

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VMware CEO Paul Maritz's keynote and VMware's strategy have been well covered. In a nutshell, the vendor's vision covers the server room from end to end.

It looks pretty in PowerPoint, and casual conversations with attendees shed light on satisfaction and eager anticipation about the offerings. One-stop shopping makes for an easy sell to the CFO, when you're talking cost-cutting.

Of course, whether VMware will be able to execute on its strategy from a technological and a market perspective remains to be seen.

The initiative is far-reaching and on that "is going to define us for the next several years," Paul Maritz told a group of analysts and reporters at a briefing following the keynote on Tuesday.

VMware CEO Paul Maritz
VMware CEO Paul Maritz
holding a Q&A session
with analysts and press

From an eagle eye view of the industry, it was inevitable that virtualization would move beyond the hypervisor. Commoditization has been a long time coming. Microsoft's arrival on the scene, and thus increased competition, were equally inevitable.

Technology-wise, VMware has a history of growing its own rather than deep developmental partnering for the big stuff. As a result, an ecosystem of less embedded partnerships has built up around its products to fill the gaps.

Tuesday's announcement revealed VMware's intent to fill the gaps. Obviously, this will change the game quite a bit.

"We laid out a strategy for three very ambitious things to do. We're going to need all the friends we can get," Maritz said when asked if a new approach would be taken.

These friends, according to Maritz, will come in the form of partners.

"When you're building on a platform, you have to work with partners," Maritz said, noting that although VMware has the basics, "this is something we need to strengthen, and we need to grow." He emphasized communication with service providers and software developers, which will be key to its success. He talked of dialogs to "ensure their needs meet our needs."

Despite the touchy-feely nature of that response, a conversation with a senior executive at a virtulazation company was very thought provoking. Consider that many of these partners will now be in direct competition with VMware. Where they end up in the ecosystem will be interesting to follow. How VMware develops the expertise to cover all of this ground will be something to watch as well.

VMware is one of the most successful Silicon Valley companies right now. With the financial markets in near meltdown, and many of these smaller companies VC-backed, its not a stretch to imagine VMware going on an acquisition spree.

That, obviously, is not partnering. Nor is it usually friendly.

There is also the opposite side of the coin to consider. Microsoft is clearly competing against VMware in the virtualization space. Is VMware now competing against Microsoft in the operating system space?

When asked what Microsoft's takeaway about this should be and whether VMware is now a threat to Redmond, Maritz responded, that his company is an "indirect threat to the Microsoft OS model, and not one we cooked up. This is the way the world is going, and they [Microsoft] have to figure out how to respond to that."

But it isn't just Microsoft that's threatened by VMware's new model. By adding end-to-end capabilities to manage the entire server room, VMware is encroaching on turf that Oracle, Tivoli and CA firmly occupy. VMware may be a shark in the virtual ecosystem pool, but in this pond it's probably somewhere between a guppy and a trout.

Where it will be on the food chain rests strongly on how it manages the relationships it has cultivated and how will user enterprises are to make a fundamental shift to an all encompassing virtualization model.

Amy Newman is the managing editor of ServerWatch. She has been following the virtualization space since 2001 and has been at VMworld since Monday.

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This article was originally published on Friday Sep 19th 2008
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