Paul Maritz Out As VMware CEO(techcrunch.com)
techcrunch.com
Paul Maritz Out As VMware CEO
http://techcrunch.com/2012/07/16/paul-maritz-out-as-vmware-ceo-and-mentioned-as-candidate-for-top-spot-at-emc-or-cloud-foundry-spin-off/
6 comments
(Answering the GigaOM analysis ...)
They are a legacy player. Virtualization is available in just about every chipset and for free in the Linux kernel and newer Windows. Sure, they may still have some advantages in some areas, perhaps better high end management software, but it's really only a matter of time before everything they do is available at no cost somewhere else.
Anecdotally every one of our customers is looking to get rid of VMware.
They are a legacy player. Virtualization is available in just about every chipset and for free in the Linux kernel and newer Windows. Sure, they may still have some advantages in some areas, perhaps better high end management software, but it's really only a matter of time before everything they do is available at no cost somewhere else.
Anecdotally every one of our customers is looking to get rid of VMware.
They are a legacy player.
But it didn't have to be that way.
Things maybe available at no cost, but you can be damn well sure that a lot of companies want to pay. That's why Citrix does so well from Xen, and RedHat from Enterprise Virtualization.
If VMWare had been more aggressive in their pricing they could have flooded the market to the point where they would have been the default choice, and cheap enough that no one would bother looking elsewhere.
The VMWare customers I know are looking elsewhere too, but it is reluctantly. They don't actively want to move, but the cost savings are just too big to ignore.
But it didn't have to be that way.
Things maybe available at no cost, but you can be damn well sure that a lot of companies want to pay. That's why Citrix does so well from Xen, and RedHat from Enterprise Virtualization.
If VMWare had been more aggressive in their pricing they could have flooded the market to the point where they would have been the default choice, and cheap enough that no one would bother looking elsewhere.
The VMWare customers I know are looking elsewhere too, but it is reluctantly. They don't actively want to move, but the cost savings are just too big to ignore.
Not to mention the exhorbitant licensing costs!
Yes he may be out as CEO of VMWare ...but the more interesting part of the news is :
Is he the new Head honcho for EMC (a sure promotion)?
Is he the new leader of the (soon to be spun-off) new cloud business?
Is he "out" as in "not related to anything VMWare or EMC any more"?
I think this is just the first act - more to follow soon.
Is he the new Head honcho for EMC (a sure promotion)?
Is he the new leader of the (soon to be spun-off) new cloud business?
Is he "out" as in "not related to anything VMWare or EMC any more"?
I think this is just the first act - more to follow soon.
Didn't Rod Johnson, CEO of Vmware's SpringSource division, announce his retirement 12 days ago, without giving a reason? Did he know about this and got out before the axes fell? http://adtmag.com/blogs/watersworks/2012/07/rod-johnson-leav...
Sounds like there's some restructuring going on there. The retrenchments are coming...
Sounds like there's some restructuring going on there. The retrenchments are coming...
Interesting to see two major CEO changes today. However, has anyone used Cloud Foundry? And why everyone wants to get into "cloud provider" business?
Amazon is winning that market on price and features. And big players like Google, Microsoft etc. are good enough for competition.
Not to mention other established companies like Rackspace, Heroku who have loyal user base.
Amazon is winning that market on price and features. And big players like Google, Microsoft etc. are good enough for competition.
Not to mention other established companies like Rackspace, Heroku who have loyal user base.
More to the point: Amazon is winning that market using an open source stack which is frankly better and more performant than vmware's stuff. This company had some amazing stuff back in the day, but they've been passed technologically by the market and refused to open their products for too long. It should have been clear this was going to happen the instant the VT-x specs were published. But they turtled instead of innovating.
Their desktop solution is still pretty good, I hear. I don't use it though, as kvm works fine for my needs. And selling to a small market (developers) in competition with multiple free solutions isn't a good place to be.
Their desktop solution is still pretty good, I hear. I don't use it though, as kvm works fine for my needs. And selling to a small market (developers) in competition with multiple free solutions isn't a good place to be.
I think that's a fairly naive view - or at least one that ignores the nuances of the virtualization market.
VMWare sells mainly to enterprise buyers. Many of them are a few years away from even beginning to use a public cloud provider like Amazon.
In that market VMWare's competitors are Microsoft (HyperV), Citrix (Xen+CloudStack) and Redhat (Enterprise Virtualization).
VMWare's biggest problem in the enterprise market is price. Any of the companies listed above are significantly cheaper than VMWare, and in the last few years have reached feature parity with VMWare.
VMWare is playing like they have vendor-lock in. The thing they seemed to have missed is that virtualization is accelerating, which means companies can look at what VMWare wants to charge for a new license, look at how much money they will save using (say) HyperV and see that the costs of switching are easily saved often within the first 12 months (sometimes many times over!).
The whole "open" thing is kind of wrong too. VMware might not be open source, but they have open APIs which are just as important in this market.
Then there is CloudFoundry. No one understands VMWare's strategy with CloudFoundry. It is like they are doing the Gillette strategy (give away the razors/PAAS and make money on the blades/virtulization), but then made sure their razors/PAAS could work with any blades/virtulization technologies.
They have been so aggressively open with CloudFoundry it is amazing. They literally have no way to pay for it, and are madly trying to commodidize themselves by making it run on Amazon/OpenStack.
I've never seen any analyst explain it, and I've spent a long time trying to understand it. In the end I've concluded they are trying a platform play, combined with an IBM-like move to consulting. That doesn't really make sense, but not much about it does...
Edit: I should say - I do really like CloudFoundry. I think it is a little early in the market still, but in a couple of years it will be in a very strong position. I guess then they could sell management tools ontop of it...
VMWare sells mainly to enterprise buyers. Many of them are a few years away from even beginning to use a public cloud provider like Amazon.
In that market VMWare's competitors are Microsoft (HyperV), Citrix (Xen+CloudStack) and Redhat (Enterprise Virtualization).
VMWare's biggest problem in the enterprise market is price. Any of the companies listed above are significantly cheaper than VMWare, and in the last few years have reached feature parity with VMWare.
VMWare is playing like they have vendor-lock in. The thing they seemed to have missed is that virtualization is accelerating, which means companies can look at what VMWare wants to charge for a new license, look at how much money they will save using (say) HyperV and see that the costs of switching are easily saved often within the first 12 months (sometimes many times over!).
The whole "open" thing is kind of wrong too. VMware might not be open source, but they have open APIs which are just as important in this market.
Then there is CloudFoundry. No one understands VMWare's strategy with CloudFoundry. It is like they are doing the Gillette strategy (give away the razors/PAAS and make money on the blades/virtulization), but then made sure their razors/PAAS could work with any blades/virtulization technologies.
They have been so aggressively open with CloudFoundry it is amazing. They literally have no way to pay for it, and are madly trying to commodidize themselves by making it run on Amazon/OpenStack.
I've never seen any analyst explain it, and I've spent a long time trying to understand it. In the end I've concluded they are trying a platform play, combined with an IBM-like move to consulting. That doesn't really make sense, but not much about it does...
Edit: I should say - I do really like CloudFoundry. I think it is a little early in the market still, but in a couple of years it will be in a very strong position. I guess then they could sell management tools ontop of it...
I understand what you're saying, but if anything I think you're being too nuanced. VMWare's core technology, the thing that they do "best", is virtualization, not cloud services. Anyone can push a cloud services platform (quite frankly, everyone is pushing a cloud services platform). And virtualization has become commoditized by open source solutions like Xen (cloud) and kvm (desktop).
Broadly selling to "enterprise buyers" a solution they can get for free from someone else is the kiss of death over the long term, no matter how lucrative that market might be.
Broadly selling to "enterprise buyers" a solution they can get for free from someone else is the kiss of death over the long term, no matter how lucrative that market might be.
This is true, but the enterprise market will be around for at least 3 more years. At that point PAAS might be a bigger factor in the market and CloudFoundy might be something that makes a lot of sense.
> Amazon is winning that market using an open source stack
http://www.forbes.com/sites/ciocentral/2012/04/03/be-wary-of...
Leaving that here...(Ignore the article, read the single comment below by Jim Plamondon.)
http://www.forbes.com/sites/ciocentral/2012/04/03/be-wary-of...
Leaving that here...(Ignore the article, read the single comment below by Jim Plamondon.)
On a side note, Forbes website has terrible UX. First I'm presented with page-takeover ad. Then page is full of flash based ads. Page loading was terribly slow. Looking at web inspector, it made ~ 266 requests for ~ 187 KB of data. And it took 14 seconds to load it (even though I'm on fast corporate n/w). On top of that, I can't find single comment on the article. Then I see "Expand comments" in small font. In confusion, I click the link and then I saw the comment by Jim. What is tech team doing at Forbes? Imagine if I'm accessing it on mobile device.
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Whenever I'm faced with something like this, I remind myself of the essential question to ask when deciding how to prioritise work on a content site:
How will this affect advertising revenue?
Having a design HN hates may correlate with losing significant numbers of users and therefore revenue over time ... but then again it may not, and there's always the opportunity cost quesstion when deciding how to calibrate "significant numbers".
How will this affect advertising revenue?
Having a design HN hates may correlate with losing significant numbers of users and therefore revenue over time ... but then again it may not, and there's always the opportunity cost quesstion when deciding how to calibrate "significant numbers".
Yeah it's pretty bad.
I don't know if they realize that or not.
I don't know if they realize that or not.
I think you'll need to elaborate a little. None of that stuff competes with VMWare software. I was talking about Xen.
I was talking about the "open source" bit in the quotation. I couldn't care less about what VMware does.
EDIT:
Oh, just reread your comment, sorry I thought "open source stack" was referring to AWS.
EDIT:
Oh, just reread your comment, sorry I thought "open source stack" was referring to AWS.
If you need more incentive to read the comment, this phrase might help: Cloud Zombie Apocalypse
I agree with you. They had some seriously cool stuff in 90s with virtualization. It was like pushing the limits of computer science.
But why don't they continue to innovate in that market? For Android fragmentation alone there is serious need for virtualization. If they can solve that problem then revenues will go through the roof.
But why don't they continue to innovate in that market? For Android fragmentation alone there is serious need for virtualization. If they can solve that problem then revenues will go through the roof.
The 90s? They didnt launch until 99 and were hardly used widely until a fair time after that. Their heyday was ~2004-2007/8
They keep buying more and more products that have nothing to do with virtualisation. Typical EMC mentality.
I think very few phones are powerful enough to run recent Android on top of an obsolete version of Android.
CloudFoundry is a compliment to, not a substitute for EC2. Many organizations use Foundry as their abstraction layer over EC2, including some very large installs.
I think it's more about being forced into that business. The economics of cloud computing is so compelling, that it's going to be the rarest of companies that manages its own hardware and software (or even IT) in 10-15 years.
Screwed by EMC? The way EMC runs companies I'm surprised VMWare is still around! And now that Gelsinger is at the helm... Well, would suck to work there ATM!
“They’re trying to optimize for revenue instead of market share and — good, God — Maritz if anyone should know that they need to occupy the high-share, high-volume, low-price position, which is what Microsoft did to destroy the legacy Unix OS business. VMware is behaving more like a legacy player than anything.”
[1] http://gigaom.com/cloud/vmware-seeking-scale-took-its-eye-of...