The facts on VMware vs. Microsoft

[Updated 3:45 PM] Last week saw the opening rounds of a new war between incumbent virtualization player VMware versus Microsoft.  VMware fired the first shot in a New York Times story and immediately followed up with a whitepaper attacking Microsoft with a list of complaints. Microsoft responded with this blog.  I wanted to get to the bottom of this and e-mailed both VMware and Microsoft requesting a teleconference. VMware was brave enough to step up, while Microsoft declined to meet and merely pointed me to its blog response.  I'll do my best to represent both sides fairly, although Microsoft declined to meet or answer any direct questions even after I sent them an e-mail with questions from my VMware meeting.

I got VMware on the phone and the first thing I asked them about was the concern about VHD (Virtual Hard Drive) restrictions.  VHD is a Microsoft virtual hard drive format that's free for any virtualization vendors to use, but VMware is actually complaining about Microsoft's free virtual demo appliances.  Microsoft's demo appliances for things like Windows XP trial VM will run only on Microsoft's Virtual PC. They aren't licensed for any other Virtual Machine host and will deactivate themselves if they detect.  I pointed out that these were somewhat special cases and this applied only to free demonstration virtual machines, but VMware felt that this could set a bad precedent because future commercial appliances can be delivered via VHD and Microsoft might apply the same kinds of restrictions to lock out other virtualization vendors.

I asked Microsoft if it will put this hypothetical concern to rest, but I got no answer.  I also asked Microsoft why it would turn down an opportunity to reach a much wider audience with its free demo machines, since VMware is popular with many hardcore Windows administrators. I didn't get a response on that either.  VMware started its Virtual Machine Center way back in 2005, and I was already calling on Microsoft to permit demo appliances, though it didn't happen for another year.  Unlike Microsoft, VMware has opened its VMDK (Virtual Machine Disk Format), which opens VMware's massive virtual machine center for Microsoft to convert into its own VHD format--though it's actually up to the appliance vendors to permit this type of conversion or not.  While Microsoft is within its rights to put limits on its own demo appliances, it should answer the hypothetical question on commercial appliances.

Next, I asked about were the mobility restrictions on virtualization with Microsoft software.  According to VMware, Microsoft puts a 90-day restriction on Virtual PC migration for Microsoft software, so if you move a machine once, you can't move it again for the next 90 days.  Since one of VMware's differentiating features in its enterprise server software is the ability to migrate Virtual Machines on the fly within a fraction of a second for hardware independence, these mobility restrictions in Microsoft software neutralize that VMware advantage.  Current Microsoft virtualization and even the upcoming Windows Hypervisor in Longhorn server lack this mobility feature. One could be cynical and read this as a convenient way for Microsoft to neutralize one of VMware's advantages.  Perhaps when Microsoft eventually starts offering its own way to migrate virtual machines on the fly, we might just see those mobility restrictions conveniently lifted.  Since I can think of no other logical explanation for this kind of mobility restriction from Microsoft, I tend to think that neutralizing enterprise VMware mobility features is the likely explanation.  Again, Microsoft declined to answer any questions.

I moved on to the concern about Novell making deals with Microsoft on virtualization, and VMware responded that it wasn't really sure about the details of that arrangement.  Since the Novell/Microsoft deal is extremely controversial with the open source crowd, it seemed like VMware was just trying to mobilize the OSS movement against Microsoft and didn't really have any specific charges on this issue.

The final complaint was about a new set of Windows virtualization APIs, or "enlightenments," as Microsoft calls them, which is much like the concept of paravirtualization in Xen virtualization.  I covered this new Microsoft Virtualization architecture in depth during WinHEC last May.  I recall standing there between four VMware engineers and four Microsoft engineers when all these details were released in a technical session, and it was definitely a sight to behold.  I asked Microsoft at WinHEC if these new APIs will be available to other virtualization vendors, such as VMware or Xen Source, and Microsoft responded yes but said the technology has to be licensed.  That means if VMware wants to leverage these new APIs put into Windows Longhorn Server and a smaller subset of them in Windows 2000 and 2003 for improved memory and storage performance, it would need to pay licensing fees.  I looked at the VMware engineers after hearing about this and I could just feel the tension.  Since Microsoft spent time and money developing these APIs, and it's their IP (intellectual property), I asked VMware--a company with its own IP -  if it feels entitled to use these new APIs for free.  VMware declined to respond directly but replied that its customers would like to see these APIs open to all virtualization vendors.

To me, this is complex issue with no simple answers, because if we believe in intellectual property, Microsoft has the right to license a technology as it sees fit.  On the other hand, Microsoft could make it impossible for other virtualization companies to run Windows in an enhanced way if it sets some astronomical licensing fees for the new virtualization APIs--though I can't agree with the other extreme, that this technology somehow has to be free.  VMware can certainly afford to pay the licensing fees; it just means it won't be able to give away a free version of its Hypervisor with the enlightenment APIs.  This concerns them because the virtualization market has gotten so competitive that the price of Hypervisors has been driven to zero and the only place left to make money is in the surrounding management software.  This could mean that Windows Hypervisor will be one of the few Hypervisors with the unique ability to run the open source kernel virtualization enhancements, as well as the Windows enhancements, while the other virtualization competitors will be able to offer only the open source enhancements.

Microsoft was given an opportunity for rebuttal but declined that invitation.  They're welcome to change their mind, and they know how to contact me.  I will update this blog with any additional information.

[Update 3:45PM - Microsoft responded to my inquires with the following email.]

Microsoft believes the claims made in VMware’s whitepaper contain inaccuracies and misunderstandings of our current license and use policies, our support policy and our commitment to technology collaboration.  We believe that we are being progressive and fair with our existing licensing and use policies and creating a level playing field for partners and customers.  We are deeply committed to providing high-quality technical support to our customers who are utilizing virtualization technology.  In addition, we are committed to working collaboratively with industry leaders to foster an environment of interoperability and cooperation that best serves our customers.

We believe it's better to resolve VMware’s claims between our two companies so that we can better serve customers and the industry. EMC is a longtime partner with Microsoft, as an extension of our partnership with EMC we have been communicating and working directly with VMware. We are committed to continuing to collaborate with VMware as we have been doing on regular basis. Consistent with this, Microsoft believes that we will be able to accommodate a mutually agreeable solution between our two companies and clear up any existing misunderstanding with regard to the points raised in the whitepaper.

Since this doesn't specifically address the questions raised in this blog, I responded with the following questions.

• Will MS extend those VHD restrictions beyond mere demo appliances in the future?
• Why restrict demo appliances from other Hypervisors?
• Why the 90 day restriction on moving machines?
• Is there a standardized price for other virtualization players to license Windows enlightenments?

Microsoft has declined to answer these specific questions.