Welcome!

Java IoT Authors: Zakia Bouachraoui, Yeshim Deniz, Carmen Gonzalez, Elizabeth White, Pat Romanski

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)

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.


IoT & Smart Cities Stories
Blockchain is a new buzzword that promises to revolutionize the way we manage data. If the data is stored in a blockchain there is no need for a middleman - the distributed database is stored on multiple and there is no need to have a centralized server that will ensure that the transactions can be trusted. The best way to understand how a blockchain works is to build one. During this presentation, we'll start with covering the basics (hash, nounce, block, smart contracts) and then we'll crea...
History of how we got here. What IoT devices are most vulnerable? This presentation will demonstrate where hacks are most successful, through hardware, software, firmware or the radio connected to the network. The hacking of IoT devices and systems explained in 6 basic steps. On the other side, protecting devices continue to be a challenging effort. Product vendors/developers and customers are all responsible for improving IoT device security. The top 10 vulnerabilities will be presented a...
As the fourth industrial revolution continues to march forward, key questions remain related to the protection of software, cloud, AI, and automation intellectual property. Recent developments in Supreme Court and lower court case law will be reviewed to explain the intricacies of what inventions are eligible for patent protection, how copyright law may be used to protect application programming interfaces (APIs), and the extent to which trademark and trade secret law may have expanded relev...
Never mind that we might not know what the future holds for cryptocurrencies and how much values will fluctuate or even how the process of mining a coin could cost as much as the value of the coin itself - cryptocurrency mining is a hot industry and shows no signs of slowing down. However, energy consumption to mine cryptocurrency is one of the biggest issues facing this industry. Burning huge amounts of electricity isn't incidental to cryptocurrency, it's basically embedded in the core of "mini...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
Every organization is facing their own Digital Transformation as they attempt to stay ahead of the competition, or worse, just keep up. Each new opportunity, whether embracing machine learning, IoT, or a cloud migration, seems to bring new development, deployment, and management models. The results are more diverse and federated computing models than any time in our history.
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
Atmosera delivers modern cloud services that maximize the advantages of cloud-based infrastructures. Offering private, hybrid, and public cloud solutions, Atmosera works closely with customers to engineer, deploy, and operate cloud architectures with advanced services that deliver strategic business outcomes. Atmosera's expertise simplifies the process of cloud transformation and our 20+ years of experience managing complex IT environments provides our customers with the confidence and trust tha...
Where many organizations get into trouble, however, is that they try to have a broad and deep knowledge in each of these areas. This is a huge blow to an organization's productivity. By automating or outsourcing some of these pieces, such as databases, infrastructure, and networks, your team can instead focus on development, testing, and deployment. Further, organizations that focus their attention on these areas can eventually move to a test-driven development structure that condenses several l...