VMware: OpenStack an opportunity for us

VMware prefers to see OpenStack as a way to sell its software into best-of-breed environments. Do you agree?
Written by Larry Dignan, Contributor

VMware's Raghu Raghuram said OpenStack, the open source cloud platform, will turn out to be an opportunity for the company because it will ultimately be able to sell its wares into best-of-breed environments.


Speaking at an Oppenheimer investment conference, Raghuram, executive vice president of cloud infrastructure and management, positioned VMware's VCloud suite vs. OpenStack. The upshot is that the two stacks play to different audiences. He said:

OpenStack is an open framework for companies to assemble, our systems integrators for that matter, to assemble their own cloud solution. So, they can pick best of breed, hypervise their best of breed storage components, network components, management components, etc. and put together a solution. VMware traditionally has been selling a suite, which is an integrated solution of one of those components in order to build a cloud. So, the analogy that I usually draw is one of the home theater market. So, there are customers that would assemble their own home theater and there are customers that buy a home theater in the market. So, two different ways of achieving the same goal. So, we have traditionally been, to continue the analogy one step further, in this home theater in a box offering market, right? So, VCloud suite is one integrated suite, the customers get everything they would need to build a cloud. We see OpenStack as, for VMware, an opportunity to expand our addressable market, because we can now supply components to those that want to assemble their own cloud solution.

Virtualizing the Enterprise: An overview

Raghuram's take was notable, but it's unclear whether OpenStack enterprises, which are likely to favor open source are really going to consider VMware applications. Time will tell if OpenStack turns out to be more of a rival to VMware.

Also see: Where does OpenStack go from here? | Happy Birthday OpenStack! How did you grow up so fast?

On other topics:

  • 75 percent of VMware's vCloud suites are sold via enterprise licensing agreements direct, but channel efforts are picking up.
  • In the U.S. VMware is selling add-on products since market penetration is high. Europe is behind on virtualization and APAC is overall positive with a lot of nuances. For instance, Raghuram said Australia was "perhaps the most virtualized nation on the planet" and China was a potentially huge market for VMware.
  • Virtual desktops are 10 percent of VMware's license revenue.
  • Software defined networking will take time to adopt, but it will upend the networking market. "we think by the time it's all said and done, the networking world will look very different. Now, how long it takes is anybody's guess. But it is a significant transformation," said Raghuram.
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