Event Report - VMware makes a lot of progress - but the holy grail is still missing

• End User Computing (EUC) is getting bigger and bigger for VMware - It’s only 12 months ago when the industry pundits gave VMware (rightfully) a hard time on the direction of EUC, especially around the future of SocialCast. Well – what a difference a year makes: The VMware EUC portfolio is growing fast and partnering left and right in the industry (e.g. partnerships with heavyweights like Google, NVidia and SAP were announced on stage today). And the EUC story ties nicely into the overall story of VMware using vCloud Air – probably the EUC products are the largest load that VMware can drive into the data centers that run vCloud Air. The hospital doctor demo that Poonen and Colbert showed on stage showed some key progress on how people should work – transferring sensitive data (patient X-Ray images) safely between heterogeneous devices with the help of Airwatch content locker. But is should be even easier – and it’s good to hear that VMware is working on usability and some next generation capabilities. And the provisioning of applications with CloudVolumes demos looks like … black magic. It’s good to see that VMware is ruthlessly working on reducing the cost of running a desktop as lower costs make more usage scenarios available and lower cost helps the overall adoption of virtual desktops. 

•  OpenStack & Containers - revisited - The OpenStack and various container partnerships received more attention today – and combined with the afternoon briefings of yesterday the picture here gets much clearer on the business side. Kudos to VMware executives to share that customer demand is one (or the key) driver here. And while the OpenStack move is more defensive – yes customers can run now from an OpenStack console a VMware powered data center under hoods – the container move is critical as it gives VMware some chops into the important next generation applications business. Enterprises build these next generation applications primarily on the public cloud, using the popular containers. For VMware to bring back that load to the corporate data center is a key move to extend the life of a VMware powered data center. They key factor here will be TCO – on both cases – OpenStack and containers – and comes back to VMware being able to reduce the cost to run VMware powered data centers. VMworld showed that VMware looks at cost, e.g. in the EUC space – but in general my impressions were, that VMware is trying to add value with NSX and more to keep the license share / revenue constant. A valid strategy but it may be challenged with the zero to very low license costs seen with OpenStack and Open Source in general. 

• Hybrid Cloud - gaining traction - Good to see VMware moving ahead in this key area – but at less speed than I am afraid is important for the company and its customers. Brunozzi demoed a nifty DR scenario – where vCloud Air is being used for disaster recovery. But VMware can and needs to do so much more here. Granted it’s early days but the dynamic shifting of loads is the business case that is really what VMware needs to address – better sooner than later. If VMware is early in addressing this – they can be part of the shift of a more growing part of enterprise automation being powered by the public cloud providers. One of the most welcomed demo features was the vMotion of a VM over long distance. So with VMware using the same platform both on the on premise and cloud side, the capability is there. But the longer VMware will not address this – the more customers will vote with their feet – or more with a lot of work and investment for other vendors – moving loads to the public cloud. 

MyPOV

A lot of progress by VMware at this VMworld. Granted all announcements are still out and a ot of product has to be build – some of these products being almost a year out. It is good to see VMware listening to customers, but the very reason customers are asking for support for e.g. OpenStack and containers is that the want to have less lock-in – and the largest virtualization lock-in market share wise is with VMware. It comes back to VMware to create constantly more value around that – after all who wants to leave a golden cage? 

But at the same time the warning bells should be ringing in the executive team around Gelsinger. For the longest time I was thinking that VMware was a hostage of the high margins it monetizes from its on premise business. In conversation with executives I was convinced though that – if done right – VMware could generate even more revenue if moving these customers to the public / VMware cloud. So the question is what is holding VMware back? It is certainly not the CAPEX challenge many of its partner faces, both VMware and EMC have deep enough pockets. I am convinced it is also not the executive team not ‘getting this’. So what remains is a product roadmap challenge – VMware needs to build product to attract customers to build next generation applications on the VMware cloud and find a solution to move on premise load dynamically to the public cloud. Which will be a hybrid cloud scenarios – and I remain with my verdict that this remains the Holy Grail for VMware – as no vendor knows and understands current enterprise workload as well as VMware. VMware did not announce any capabilities here – maybe it will surprise us in the next quarters to come. 

In the meantime the EUC portfolio is making great progress – if the team around Poonen can keep the momentum 2015 will be an even more exciting year for the VMware EUC portfolio.


More on VMWare by me

• First Take - VMware's VMworld Day 1 Keynote - Top 3 Takeaways - read here.

• Progress Report - Good start for VMware EUC - time for 2nd inning - read here.

• Speed Briefings at VMworld - inside and outside the VMware ecosystem - read here.

• VMware defies conventional destiny - SDDC to the rescue - read here.