Welcome!

Agile Computing Authors: Carmen Gonzalez, Gerardo A Dada, Liz McMillan, Jnan Dash, AppDynamics Blog

Related Topics: Containers Expo Blog

Containers Expo Blog: Article

Will VMware Still Exist in Five Years?

VMware deserves a lot of credit. It turned this industry on its head. But will it still exist in 5 years?

Brian Madden's Blog

VMware deserves a lot of credit. Even though hardware virtualization has been around for decades in one form or another, we wouldn't have it in the x86 space without VMware. The hardware and OS vendors would have been happy to keep selling hardware that was only 20% utilized. VMware turned this industry on its head. But it has awoken the slumbering giant that is Microsoft...

[Note from the author: This wasn't an article I intended to write right now. But after Alex Barrett blogged about a conversation I had with her last week on this very topic, my inbox has been flooded with emails asking "Did Alex really quote you properly?" and "Are you crazy?" The answers to those two questions are "yes" and "quite possibly."]

VMware deserves a lot of credit. Even though hardware virtualization has been around for decades in one form or another, we wouldn't have it in the x86 space without VMware. The hardware and OS vendors would have been happy to keep selling hardware that was only 20% utilized. VMware turned this industry on its head. They deserve credit not only for the move towards virtual hardware, but also for the whole VDI concept. (Even though VMware did not initially embrace VDI, the early adopters / creators of the concept couldn't have done it without VMware.)

So kudos to VMware for doing some awesome stuff.

But VMware will face some tough times ahead:

  • Hardware virtualization is becoming a commodity, and when this happens, you end up with a lot of competitors, feature parity across vendors, and a price race to the bottom.
  • The "easy" virtualization sales have been made already. What's left is the more complex stuff, with longer sales cycles and more complex deals.
  • Now that VMware has "proven" the concept of hardware virtualization, and now that analysts have predicted this market will be <insert some random 11-digit dollar amount> by <insert some year>, many companies are entering the space.

VMware has awoken the slumbering giant that is Microsoft. Sure, there have been isolated cases of smaller companies successfully competing against Microsoft, or smaller companies partnering with them (e.g. Citrix), but in general, if you're a software vendor and Microsoft puts you in their crosshairs, you days are numbered. Microsoft will add many of VMware's core features into the base OS over the next several years without really increasing the price. And in addition to Microsoft, many other companies are entering the hypervisor space, including Citrix, Novell, Sun, Oracle, and even Phoenix Technologies (the BIOS makers).

Of course VMware has the first-mover advantage in the virtualization market, and conventional business wisdom suggests this can help a company win long-term. But history is full of wildly successful businesses who only entered a market after another "first mover" blazed the trail. Look at Amazon, Walmart, eBay, Starbucks, Microsoft--none of these was the first company in their sapce, and each of them dominates today.

I don't want to minimize the impact that VMware has had on the industry. But I think in five or ten years, VMware will be more significant for what they did in the 2000s, not what they're doing at that time.

I'll write another article tomorrow about what VMware could do to maintain their dominant position. Feel free to share your thoughts in the comments today. Here are some points to kick-start the conversation:

VMware is doomed

  • They only make one type of product, and it's a market that everyone is entering.
  • They're competing against Microsoft.
  • People will want to buy a more complete integrated solution from one vendor, and that includes things that VMware doesn't own
  • VMware is too dependent on other vendors that they're also competing against. For Citrix servers, why not use Citrix's virtualization? For VDI, why not use Microsoft's RDP or Calista? For packaging offline Windows VMs, why not use Microsoft's Kidaro to package Microsoft Windows? For software distribution, why not use the packager of your distribution vendor (Citrix or MS) instead of Vmware's Thinstall?

VMware will continue, no problem

  • First mover advantage. ("No one ever got fired for buying IBM." We have that now in the virtualization space with VMware. VMware = Virtualization. Period.)
  • Even though their stock has lost more than 60% of its value, VMware's market cap is still $18B (3x Citrix)
  • VMware is owned by EMC. (Remember only 10% of VMware's shares are public.) EMC's market cap is $31B
  • The virtualization market will be HUGE in five years. VMware only needs to grab a small slice.
  • Only the actual hypervisor will become a commodity. VMware and others will compete on the value-adds, which VMware leads

What does VMware need to do to survive?

  • ?? Let's discuss ??

This post appeared originally here and is republished in full with the kind permission of the author, who retains full copyright.

More Stories By Brian Madden

Brian Madden is an independent technology analyst, author, and thinker. He's written several books and hundreds of articles about Citrix and application delivery technology. He is a five-time Microsoft MVP, a Citrix CTP, and the creator of BriForum, an annual independent application delivery technical conference. He's also the editor-in-chief of BrianMadden.com, a popular industry website with millions of visitors per year. Madden lives in New York City.

Comments (2) View Comments

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


Most Recent Comments
X-Wall Street Trader & Computer programmer 04/06/08 09:25:43 PM EDT

"Slumbering Giant".....Stop with the big MSFT but kissing. Have you ever looked into the history that Microsift has in the VIRTUAL software arena. They have failed....now that another player joined and is doing it well, everybody has to say that MSFT is going to be better. Yes, MSFT will have a spot in the VIRTUAL game but for the big network designers, they will go with the better product.
Now the issue is STOCK PRICE, the guys who trade this & the Wall St analyst are the ones making the comments about the product. That is like a redneck from West Virginia talking about European soccer....and not sticking to NASCAR or deep fried turkey.

Hyper-V the Giant-Killer 04/04/08 08:28:14 AM EDT

Now with Hyper-V, the recently released Microsoft virtualization product for Windows Server 2008, the answer has to be: no!

@ThingsExpo Stories
Bert Loomis was a visionary. This general session will highlight how Bert Loomis and people like him inspire us to build great things with small inventions. In their general session at 19th Cloud Expo, Harold Hannon, Architect at IBM Bluemix, and Michael O'Neill, Strategic Business Development at Nvidia, discussed the accelerating pace of AI development and how IBM Cloud and NVIDIA are partnering to bring AI capabilities to "every day," on-demand. They also reviewed two "free infrastructure" pr...
Financial Technology has become a topic of intense interest throughout the cloud developer and enterprise IT communities. Accordingly, attendees at the upcoming 20th Cloud Expo at the Javits Center in New York, June 6-8, 2017, will find fresh new content in a new track called FinTech.
WebRTC is the future of browser-to-browser communications, and continues to make inroads into the traditional, difficult, plug-in web communications world. The 6th WebRTC Summit continues our tradition of delivering the latest and greatest presentations within the world of WebRTC. Topics include voice calling, video chat, P2P file sharing, and use cases that have already leveraged the power and convenience of WebRTC.
As data explodes in quantity, importance and from new sources, the need for managing and protecting data residing across physical, virtual, and cloud environments grow with it. Managing data includes protecting it, indexing and classifying it for true, long-term management, compliance and E-Discovery. Commvault can ensure this with a single pane of glass solution – whether in a private cloud, a Service Provider delivered public cloud or a hybrid cloud environment – across the heterogeneous enter...
"At ROHA we develop an app called Catcha. It was developed after we spent a year meeting with, talking to, interacting with senior citizens watching them use their smartphones and talking to them about how they use their smartphones so we could get to know their smartphone behavior," explained Dave Woods, Chief Innovation Officer at ROHA, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Events announced today that Fusion, a leading provider of cloud services, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Fusion, a leading provider of integrated cloud solutions to small, medium and large businesses, is the industry’s single source for the cloud. Fusion’s advanced, proprietary cloud service platform enables the integration of leading edge solutions in the cloud, including cloud...
Video experiences should be unique and exciting! But that doesn’t mean you need to patch all the pieces yourself. Users demand rich and engaging experiences and new ways to connect with you. But creating robust video applications at scale can be complicated, time-consuming and expensive. In his session at @ThingsExpo, Zohar Babin, Vice President of Platform, Ecosystem and Community at Kaltura, discussed how VPaaS enables you to move fast, creating scalable video experiences that reach your aud...
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place June 6-8, 2017, at the Javits Center in New York City, New York, is co-located with 20th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry p...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life sett...
DevOps is being widely accepted (if not fully adopted) as essential in enterprise IT. But as Enterprise DevOps gains maturity, expands scope, and increases velocity, the need for data-driven decisions across teams becomes more acute. DevOps teams in any modern business must wrangle the ‘digital exhaust’ from the delivery toolchain, "pervasive" and "cognitive" computing, APIs and services, mobile devices and applications, the Internet of Things, and now even blockchain. In this power panel at @...
The 20th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held June 6-8, 2017, at the Javits Center in New York City, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal ...
20th Cloud Expo, taking place June 6-8, 2017, at the Javits Center in New York City, NY, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy.
20th Cloud Expo, taking place June 6-8, 2017, at the Javits Center in New York City, NY, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy.
The many IoT deployments around the world are busy integrating smart devices and sensors into their enterprise IT infrastructures. Yet all of this technology – and there are an amazing number of choices – is of no use without the software to gather, communicate, and analyze the new data flows. Without software, there is no IT. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, Dave McCarthy, Director of Products at Bsquare Corporation; Alan Williamson, Principal...
Extracting business value from Internet of Things (IoT) data doesn’t happen overnight. There are several requirements that must be satisfied, including IoT device enablement, data analysis, real-time detection of complex events and automated orchestration of actions. Unfortunately, too many companies fall short in achieving their business goals by implementing incomplete solutions or not focusing on tangible use cases. In his general session at @ThingsExpo, Dave McCarthy, Director of Products...
Internet of @ThingsExpo has announced today that Chris Matthieu has been named tech chair of Internet of @ThingsExpo 2017 New York The 7th Internet of @ThingsExpo will take place on June 6-8, 2017, at the Javits Center in New York City, New York. Chris Matthieu is the co-founder and CTO of Octoblu, a revolutionary real-time IoT platform recently acquired by Citrix. Octoblu connects things, systems, people and clouds to a global mesh network allowing users to automate and control design flo...
Unsecured IoT devices were used to launch crippling DDOS attacks in October 2016, targeting services such as Twitter, Spotify, and GitHub. Subsequent testimony to Congress about potential attacks on office buildings, schools, and hospitals raised the possibility for the IoT to harm and even kill people. What should be done? Does the government need to intervene? This panel at @ThingExpo New York brings together leading IoT and security experts to discuss this very serious topic.
Businesses and business units of all sizes can benefit from cloud computing, but many don't want the cost, performance and security concerns of public cloud nor the complexity of building their own private clouds. Today, some cloud vendors are using artificial intelligence (AI) to simplify cloud deployment and management. In his session at 20th Cloud Expo, Ajay Gulati, Co-founder and CEO of ZeroStack, will discuss how AI can simplify cloud operations. He will cover the following topics: why clou...
In this strange new world where more and more power is drawn from business technology, companies are effectively straddling two paths on the road to innovation and transformation into digital enterprises. The first path is the heritage trail – with “legacy” technology forming the background. Here, extant technologies are transformed by core IT teams to provide more API-driven approaches. Legacy systems can restrict companies that are transitioning into digital enterprises. To truly become a lead...
Internet-of-Things discussions can end up either going down the consumer gadget rabbit hole or focused on the sort of data logging that industrial manufacturers have been doing forever. However, in fact, companies today are already using IoT data both to optimize their operational technology and to improve the experience of customer interactions in novel ways. In his session at @ThingsExpo, Gordon Haff, Red Hat Technology Evangelist, will share examples from a wide range of industries – includin...