The Hypervisor is Only Part of the Picture

The question of VMware’s future in the face of increasing competition is not a new one; it’s been batted around by quite a few folks. So Steven J. Vaughan-Nichols’ article “Does VMware Have a Real Future?” doesn’t really open any new doors or expose any new secrets that haven’t already been discussed elsewhere. What it does do, in my opinion, is show that the broader market hasn’t yet fully digested VMware’s long-term strategy.

Before I continue, though, I must provide disclosure: what I’m writing is my interpretation of VMware’s strategy. Paul M. hasn’t come down and given me the low-down on their plans, so I can only speculate based on my understanding of their products and their sales strategy.

Mr. Vaughan-Nichols’ article focuses on what has been, to date, VMware’s most successful technology and product: the hypervisor. Based on what I know and what I’ve seen in my own experience, VMware created the virtualization market with their products and cemented their leadership in that market with VMware Infrastructure 3 and, later, vSphere 4 and vSphere 5. Their hypervisor is powerful, robust, scalable, and feature-rich. Yet, the hypervisor is only one part of VMware’s overall strategy.

If you go back and look at the presentations that VMware has given at VMworld over the last few years, you’ll see VMware focusing on what many of us refer to as the “three layer cake”:

  1. Infrastructure
  2. Applications (or platforms)
  3. End-user computing

If you like to think in terms of *aaS, you might think of the first one as Infrastructure as a Service (IaaS) and the second one as Platform as a Service (PaaS) or Software as a Service (SaaS). Sorry, I don’t have a *aaS acronym for the third one.

I believe that VMware knows that relying on the hypervisor as its sole differentiating factor will come to end. We can debate how quickly that will happen or which competitors will be most effective in making that happen, but those issues are beside the point. This is not to say that VMware is ceding the infrastructure/IaaS market, but instead recognizing that it cannot be all that VMware is. VMware must be more.

What is that “more”? I’m glad you asked.

Let’s look back at the forces that drove VMware’s hypervisor into power. We had servers with more capacity than the operating system (OS)/application stack could effectively leverage, leaving us with lots of servers that were lightly utilized. We had software stacks that drove us to a “one OS/one application” model, again leading to lots of servers that were lightly utilized. Along comes VMware with ESX (and later ESXi) and the ability to fix that problem, and—this is a key point—fix it without sacrificing compatibility. That is, you could continue to deploy your OS instances and your application stacks in much the same way. No application rewrite needed. That was incredibly powerful, and the market responded accordingly.

This compatibility-centered approach is both powerful yet limiting. Yes, you can maintain status quo, but the problem is that you’re maintaining status quo. Things aren’t really changing. You’re still bound by the same limitations as before. You can’t really take advantage the new functionality the hypervisor has introduced.

Hence, applications need to be rewritten. If you want to really take advantage of virtualization, you need a—gasp!—platform designed to exploit virtualization and the hypervisor. This explains VMware’s drive into the application development space with vFabric (Spring, GemFire, SQLFire, RabbitMQ). These tools give them the platform upon which a new generation of applications can be built. (And I haven’t even yet touched on CloudFoundry.) This new generation of applications will assume the presence of a hypervisor, and be able to exploit the functionality provided by it. However, a new generation applications that are still bound by the old ways of accessing those applications will constrain their effectiveness.

Hence, end users need new ways to access these applications, and organizations need new ways to deliver applications to end users. This explains VMware’s third layer in the “three layer cake”: end-user computing. Reshaping applications to embrace new form factors (tablets, smartphones) means re-architecting your applications. If you’re going to re-architect your applications, you might as well build them using a using a new platform and set of tools that lets you exploit the ever-ubiquitous presence of a hypervisor. Starting to see the picture now?

If you look at VMware only from the perspective of the hypervisor, then the question of VMware’s future viability is suspect. I’ll grant that. Take a broader look, though—look at VMware’s total vision and I think you’ll see a different picture. That’s why—assuming VMware can execute on this vision—I think that the answer to Mr. Vaughan-Nichols’ question, “Does VMware have a real future?”, is yes. VMware might not continue to reign as an undisputed market leader, but I do think their long-term viability isn’t in question (again, assuming they can execute on their vision.)

Feel free to share your thoughts in the comments. Do you think VMware has a future? What should they do (or not do) to ensure future success? Or is their fall a foregone conclusion? I’d love to hear your thoughts. I only ask for disclosure of vendor affiliations, where applicable. (For example, although I work for EMC and EMC has a financial relationship with VMware, I speak only for myself.)

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  1. Tom Wheeler’s avatar

    I think you are right that the diversity is where they will shine. They will need to monitor price point and marketing carefully against competition and create application solution “hooks” like our good friends over at Microsoft. I see companies buying into Hyper-V over VMware purely based on the marketing and the “image” in their minds (not always based on fact or actual benefit comparisons!) that – “Oh, it’s Microsoft so it ties in with all our servers / System Center suite etc” and game over before it’s even begun.

    Perhaps the death of OS mentioned in your blog yesterday will open more of a path for VMware (and others) to take additional slices of the cake and create a more interesting / diverse enterprise platform based on co-existing vendor products providing much tighter fits for enterprise needs…?

  2. Frank C’s avatar

    I agree with looking at VMware as much more than a Hypervisor. If you look across their portfolio they have a broad set of applications, from management, to application deployment and end-user computing. I believe their future is integrating all of those components as they seem to be doing right now. Their work in platform as a service may cement their leadership in the area as well. I do work for a consulting company that focuses only on Microsoft technology and it does seem like they are taking the competition that VMware is providing across multiple applications very seriously with the expectation that VMware will be around for a long time and a serious competitor at the hypervisor and other areas including management and applications.

  3. Doug’s avatar

    Rewrite the applications to take advantage of the new capabilities of the platform?!? That’s crazy talk!

    I absolutely agree that there is so much more work to be done than just wrapping a VM around existing application components or workloads and hosting them on a hypervisor.

    One way to look at it is running Windows-based applications on a Mac back in the early 90s. Sure, I *needed* to run Microsoft Excel and my infrastructure was a Mac running the Motorola 68000-series chipset. So, I fired up an emulator, installed Windows in a VM, and ran Excel that way. Sure, it worked, but it was nowhere near the most efficient way to skin that cat.

    It all comes down to the use case and desired functionality. If I wanted native performance, a Mac-like GUI on Excel or tighter integration with other applications I was running, the application (Excel) had to be rewritten. Making something work tends to be the easy part; making it work the best that it can tends to require significant adjustments somewhere.

  4. @parkercloud’s avatar

    VMWare needs to keep an eye on competitive cost of their products and the management software needs to support multiple hypervisors and public cloud services or vmware will become an option rather then the leader. The vmware trend seems to be negative …

  5. Michael Webster’s avatar

    My company is a VMware Partner, but I speak for myself. I definitely think that VMware has a bright future and not just because of their technical capability, leadership and vision. Unlike many other market leaders with a massive market share advantage over the competition VMware doesn’t take this for granted, actively listens to customers, and goes to a lot of trouble and effort to maintain good customer relationships. This when also combined with the fact most customers love dealing with VMware and in general it just makes things work, on top of the technical vision and big picture, I think VMware has a very bright future. Provided VMware doesn’t take their position for granted in the future. There will be an interesting balancing act especially when the company is driving into new business models, such as consumption based pricing. Provided transparency is maintained

  6. Parikshith’s avatar

    Hi Scott, I love VMware,and I’m a big fan of vMotion, Storage vMotion and DRS/HA. I hope VMware continues to grow and be strong. Some of their technology is truly fascinating and i love the simplicity it has brought to data center. I will repeat your own words, “hypervisor is powerful, robust, scalable, and feature-rich”. Use case: Think of a data migration project (very often i find myself doing it),in a 100% virtualized environment ,when migrating from X array to Y array within the same data center. Storage vMotion where applicable is one technology that is 100 % non-disruptive and it just works. An Hypervisor being able to inter-operate with various storage vendors and making data mobile is fantastic. For rich features like this, i hope they continue to innovate and grow. For now, i love what it does and i enjoy working with VMware.

    -Parikshith

    ***DISCLAIMER : I work for ePlus Technology and part of their professional services team, and i only speak for myself****

  7. Dmitri Kalintsev’s avatar

    Scott,

    You’re talking about re-writing and re-architecting the existing applications “to take advantage of hypervisor”.

    What are your thoughts on why wouldn’t the developers at this point simply jump over to either PaaS (and forget about the OS and hypervisors altogether), or re-design their application to run on a web-scale IaaS (like OpenStack), which can arguably provide a better cost base and a better scale?

    I know OpenStack can use vSphere, but it isn’t as well integrated as other free hypervisors, and because higher-end features of the vSphere are no longer needed, there will be little reason to hold on to it.

    CloudFondry, on the other hand, aligns well with the “redevelop your apps” thing.

    – Dmitri

  8. Grant’s avatar

    I expect that a lot of the general public’s perceptions of VMware’s capabilities come down to the channel model (at least in Australia). For smaller partners who only have expertise in the Infrastructure Virtualisation space that is all that they will discuss – and hence all the customers hear about.
    With the partner competency changes coming through, I believe VMware are educating the channel around the need to expose their customers to additional business requirements that VMware is able to address.

  9. @mreferre’s avatar

    If that is what it takes to do IT journalism than here it is my take:

    - IBM is dead because the mainframe is dead
    - HP is dead because no one buys original printer ink any more
    - Microsoft is dead because Windows and Office are commoditized

    Well I think I made more profound thoughts about those 3 vendors than those that the “journalist” made about VMware. Well but after all I guess that with a title like that he was looking more at page hits rather than making a real analysis.

    In terms of redesigning application I think there will be some that may take advantage of some hypervisor capabilities (VMware has already done something around that in the JVM space) but I believe that if you need to “rewrite the app for the cloud” this will happen at a different layer (PaaS for example) and not at the IaaS/VM layer.

    Having this said it looks like IaaS/VM is toast as anyone is jumping on the new wagon. I think the legacy tail is long, very long. I am amazed that people gets so excited about the fact that AWS is touching the 1B$ mark when IBM still makes (at least) as much selling the AS/400 (which died 10 years ago).

    Not to mention that I am not sure all “new applications” are being developed for the cloud to be honest. There are still a lot of “old school” developers / organizations that are developing new applications the old way. And they will need a hypervisor (although the hypervisor is “dead”).

    Massimo Re Ferre’ (VMware)

  10. Brook Reams’s avatar

    Scott,

    I think you layed out the technology case for VMware’s value to IT engineers. But IMHO, the business case for VMware is much weaker when you consider IT infrastructure from the business side. I grossly simplify, but the business owners (those responsible for profit) consider IT infrastructure to be “waste”. Their focus is on data, applications to process it, and real-time relationships with their customers.

    Hypervisors, application development platforms to exploit them and “rearchitecting applications” are seen as more IT waste, not profit. Since the business owner writes the checks, VMware’s technology story is of “little consequence” to their decision making.

    The larger trend business owners want to understand is how/if they can eliminate ownership of IT. Or, said differently, “Can’t I just pay for IT technology as I use it?” That’s where VMware seems weak to me compared to others who own all the IT technology parts and can invest in global scale “generation” facilities.

    That said, as a nerd who works in the networking market for Brocade, I enjoy watching VMware develop and always anticipate VMWorld. They are thinking, acting and innovating and they are fun to watch.

  11. Pete’s avatar

    It’s interesting the number of… “has VMware peaked” articles in the last 6 months. Certainly VMware is more than the hypervisor, but it’s an organisation that’s certainly going through growing pains in trying to move into new markets. Much like Oracle with hardware, Microsoft with search… VMware have tried to move into new markets such as VDI space with mixed success (vs Citrix). VMware has a very strong partner community so I don’t see them going away any time soon. However, I’m sure it will be interesting year with Microsoft, KVM and Openstack all increasing their drumbeat on new products/offerings in 2012. Competition is good.

    Pete

  12. Mike Sheehy’s avatar

    Scott,

    I think you hit the nail on the head here. I think really what people are forgetting is essentially the hypervisore is an OS, no? This layer needs to exist to access the hardware resources until something better comes along. It’s my opinion, even in the longterm future, the hypervisor will exist, but evolve to take advantage of even greater hardware functions and support. You talked about this the other day with SR-IOV functions..etc. It is essential and is the CORE of the *aaS model,whether you want to call it Cloud..etc

    While, I believe it to be true, Applications are the focus and certainly End User Computing and delivery of said applications to ANY device, the core must exist to allow that functionality…this is nothing new. To me the essential change must come in the form of Application delivery, and Frameworks, and VMware is addressing that in the products you mention, as well as the products announced at last years VMworld, Project Octopus and Appblast.

    I also believe that in order for the Hypervisor layer to be essentially hidden, further management and “self-healing, self-optimization” type capabilities must exist.

    I am very excited to be a VMware customer and I can’t wait to continue this journey.

  13. Jack Bears’s avatar

    In my oppinion VMware is the only software company in the IT space that has a completely clear vision.

    vsphere or esx is not about virtualization anymore. it’s a virtual platform for all different kind of things. virtualization may be commodity but from a enhanced features perspective vmware is years ahead of the competition. one problem is that customers or enterprises are not yet ready to take full advantage of virtualization technology.

  14. vmcreator’s avatar

    Scott,

    As an avid reader of your books and a follower of most bloggers on vLauchpad, I am a real fan of VMware and its product set. My concern is what Tom and Mike mentioned:

    “I see companies buying into Hyper-V over VMware purely based on the marketing and the “image” in their minds (not always based on fact or actual benefit comparisons!) that – “Oh, it’s Microsoft so it ties in with all our servers / System Center suite etc” and game over before it’s even begun.”

    and Michael mentioned:

    “Unlike many other market leaders with a massive market share advantage over the competition VMware doesn’t take this for granted, actively listens to customers, and goes to a lot of trouble and effort to maintain good customer relationships.”

    My slant on things, is that VMware needs to furnish an army of supporters to help bang their drum. As mentioned, you guys and bloggers do a great job in this area, but VMware need to be much more reactive to the Microsoft threat. For example the talked about VMTN subscriptions, should be with us now, not in 6 months time. Microsoft do a great job with Technet, so VMware should do the same with VMTN subscriptions.

    VMware need to realise it is not just partners that need the help to sell their products. Every Tom, Dick and Harry from every arena from freelance contractors to student in University needs to have hands-on and trial out their products. VMTN subsriptions would be a good winner.

    Another area nobody has talked about is “Security”, VMware has good development with vShield and integration with anti-virus partners and Cisco networking around virtualizing everything and anything.

    In a world of rising hacking and intrusions, would one really be happy with virtualizing everything on Hyper-V?. Not me pal.

    VMware also need to bring down cost by continuing to provide more bang for the buck by moving current products into a reduced cost license model. I see this at the coalface everyday, people are concerned with the initial cost to have great functionality like dvSwitches and sVmotion. A better model would be a more granular one providing the customer with a more flexible choice on functionality choice like what the TV channel providers do.

    Individual pricing for vMotion, sVmotion, dvSwitches, FT, Host Profiles, Auto Deploy, sDRS etc.

    Bob

  15. Michael Webster’s avatar

    I agree 100% that VMware needs to bring back VMTN subscriptions. I am a subscriber to TechNet and was previously a subscriber to MSDN. Both programmes offer tremendous value for any IT professional and partners/customers that want to run lab environments. I just wouldn’t be without it. I also agree that VMware needs to continue to build their army of supporters. VMTN is a good way of doing that, and so are the VMUG’s. Continuing to add value and competing aggressively against MS is going to be required. I can see this happening and being of great benefit to customers. I can’t see the level of innovation stopping. But one of the most important things from my perspective is that VMware needs to get companies working on the latest technology and latest version of vSphere. Else it might be very easy to MS to come into a customer and say ‘You’re running ESX 3.5, our hypervisor is way superior to that, why don’t you switch?’ So the upgrade process and the means of getting upgraded needs to be very easy.

  16. Brian’s avatar

    I attended a Microsoft tech learning day a few months ago, covering the Hyper-V+System Center combo, with a focus on enabling a “private cloud.” None of the presenter’s demonstrations worked, and he had to rely on a cobbled together set of desktop-class hardware to attempt them.

    If that’s the best Msft can do with an opportunity in front of 100+ mid-level technical folks, VMWare shouldn’t worry too much about competition from that front.

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