VMware eyes Microsoft status
The more complex the system integration, the greater the need to simplify management tools.
Virtualisation pioneer VMware wants to use its footprint in computer rooms to become as ubiquitous in business as Microsoft Office.
The EMC-owned company wants to replicate the success it has achieved with virtualisation software – which allows IT departments to easily and cheaply create virtual servers without the need to purchase hardware – to drive its push to become the go-to supplier of hardware management tools.
Its vCloud, a one-stop hardware management application, claims to automate the job of systems integrators who stitch together best-of-breed technology products, according to VMware chief technology officer Steve Herrod. Without it, he says, costly and lengthy system integrations can have the opposite desired outcome: eliminate the overall benefits of technology.
Steve Herrod, chief technology officer, VMWare.
"When you have a lot of people that accidentally integrate and they come up with band-aid solutions to tie things together," Herrod said, "these IT systems are very fragile and poor integrations can have a ripple effect across the organisation."
He believes companies that use a single management platform to automate their IT infrastructure are more efficient.
"Heterogeneity is the enemy of automation," he said.
"You need to choose what hardware makes sense for the business but the orchestration on top of it has to be done one way.
"We think of it as the Microsoft Office suite for IT hardware: All the tools you need, pulled together and very easy to consume."
vCloud claims to allow 2000 different technology partner integrations and 25 APIs.
VMware Australia managing director Duncan Bennet said the majority of local customers had started to use some applications in the vCloud suite.
VMware grew rich from virtualisation software that used servers more efficiently. Now, it wants to replicate it for hardware, except without selling any.
The company is under pressure to find new sources of revenue, according to analysts.
As much as 60 per cent of US companies have already virtualised their servers, according to Sanford C. Bernstein & Co analyst Mark Moerdler. VMware's main competitors are Microsoft, which is pushing its Windows Server 2012 suite, and Citrix.
Last year, Moerdler crippled VMware shares by almost 8.5 per cent by warning market saturation and competition would slow the company's growth.
“There is a high risk of a meaningful slowdown in the next 12 to 24 months," Moerdler said at the time. He said more companies would use cheaper or free rival products for less critical tasks.
He said VMware must increase revenue from its management software.
"Even so, the company probably won't gain the dominant position in that field, and other initiatives haven't grown rapidly enough to account for slower growth."
In Australia about 50 per cent of hardware servers are virtualised, according to Telsyte analyst Rodney Gedda.
There's still room for growth but he agreed that VMware would struggle to maintain previous growth rates.
"It's true to say that VMware is spreading its wings," Gedda said. "It's become more of a general software application."
Christian Perry, senior analyst with Technology Business Research in the US, told IT Pro that VMware still had a long way to grow due to the explosion of data, computing and storage needs.
"Add in the continued rise of private cloud – a segment that VMware sells directly into – and I tend to think that any notions of VMware's imminent, or even gradual, demise are greatly exaggerated."