A perfect storm is brewing ahead and, like a fishing captain who doesn't get that a plummeting barometer means stay at port, VMware is persisting in sailing into disaster.
Yes, I know, VMware as recently as last fall owned the virtualization market. Then, 85% of all virtualization users were running VMWare. So what. I'm sure there was a company that had 85% of the buggy-whip market... just before Henry Ford decided that Americans wanted a cheap, dependable car in any color they wanted so long as it was black.
Here are my reasons why VMware's future looks just as bright as the buggy whip manufacturers.
First, there's the meta-problem that VMware faces. Everyone who's a player in the virtualization space, and I mean everyone, is either offering a free as in beer virtualization program or they're baking it for me into their chip sets or operating systems.
VMware offers its low-end offerings for free, but it makes it money exclusively from selling high-end virtualization and virtualization management software. What happens to that model when you can get a virtualization solution every bit as good for free? I'll tell you what happens to it, it dies.
Let's look more closely at this shall we?
Number one with a bullet, Microsoft is about to roll out its Hyper-V virtualization in Server 2008 this August. I am no friend to Microsoft, but every now and again, as they did with Excel, the boys from Redmond get something right. I've used beta of Hyper-V on Server 2008. In a word, it's 'impressive.' And, it will come to Windows shops ready to go in the server.
That will spell the end of VMware for businesses that believe they can do no wrong so long as they buy Microsoft.
Some people think that will lead to big trouble for IT because they'll be presented with a choice between incompatible virtualization systems. Yeah, right, you really think the Microsoft club members are going to shell out cash for VMware when they can use Hyper-V for 'free?' I don't think so.
Next, there's the idiot assumption, beloved by VMware that "We have never believed that the hypervisor would be commoditized. To imply that it's a commodity would imply that there's no differentiation," said Ben Matheson, director of marketing at VMware. Sorry Ben, we're getting to the point where there's no differentiation. Oh I can tell you in painful detail about the differences between virtualization and para-virtualization, but all an IT guy cares about is getting as many virtual machines running right on as few processors as possible.
Indeed, Red Hat's new virtualization plan is to use KVM, Linux's new built-in virtualization, to make virtualization completely and, I mean completely, generic. As far as Red Hat is concerned, virtualization is going to be like refrigerators. That is to say, 'everyone has to have one, but no one really thinks that much about their exact specifications.' And, oh yes, Red Hat executives know darn well that if they're successful with this approach, VMware is going to be wrecked.
But, it's not just Red Hat. Microsoft is partnering up with Novell and Citrix to use Xen to deliver cheaper virtualization. Even kids, well the people who run Sesame Street anyway, can figure it out. As Noah Broadwater, vice president of information services for Sesame Street Workshop, said in explaining why they went with Novell's Xen package. "VMware has a great solution, it's just very expensive."
Isn't it though?
Worse still, if you're a VMware share holder, there are purely open-source virtualization programs, like ProxMox that does all the heavy lifting for a would-be virtualization user. I can set up KVM and/or Xen from bare-metal. Most IT people can set them, or Hyper-V, up with the operating systems, such as RHEL (Red Hat Enterprise Linux), SLES (SUSE Linux Enterprise Server) or Windows Server 2008, that support them.
ProxMox, funny name and all doesn't really add anything new to the VMware's challengers, it just takes the best of the open-source virtualization programs, cleans them up, and turns them into a CD that makes setting up VMs (virtual machines) a snap. I've been working with virtualization since not long after IBM released VM/370 for mainframes. ProxMox, while it still has teething problems, is already the easiest way I've ever seen to setup and run VMs. Oh, and it's free both as in speech and as in beer.
If you really think a company built around a proprietary and pricey program is going to be able to handle getting stormed with low-cost and free software from both the proprietary world-Microsoft--and the open-source world, Red Hat, Novell, and non-commercial offerings to boot... well would you cash this $800,000.00 US dollars bank draft for me since I'm now in Paraguay?